The Effect of Culture on Energy Efficient Vehicle Ownership

We provide an empirical analysis on the relation between culture and revealed environmental economic preferences. Switzerland's citizens share all major institutions but belong to multiple population groups which differ by culture and language across distinct geographical locations. This unique setting allows us to disentangle the effect of culture on individual consumer preferences from institutional characteristics. We use a spatial fuzzy Regression Discontinuity Design (RDD) at the internal French/German language border on municipality level data to estimate the effect of culture on preferences for energy efficient vehicle design. Our results indicate that French speaking municipalities have a 5.5 percentage points higher share of energy efficient vehicles compared to their German counterparts. In addition, we find that popular votes on environmental issues receive a substantially higher share of approval in French speaking regions. This indicates that they place a higher value on the environment, which may be due to a higher sense of collectivism and altruism