This dissertation consists of three essays, which explore how public policies influence household and firm behavior, and the impact policies could have on environmental outcomes. The essays examine how households respond to price-based policies, the impact information disclosure policies could have on environmental outcomes, and finally the influence of normative appeals and non-pecuniary strategies on behavioral outcomes. Understanding these adjustments in the behavior of the agents is

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... arly important for policy design and for legislators who intend maximize societal benefit. The first essay, titled Matchmaking Between Vehicle Miles Traveled and Fuel Economy: the Role of Gasoline Prices, studies a potential effect of gasoline prices that has been over- looked in the literature. Due to heterogeneity in demand for vehicle miles traveled (VMT), when gasoline prices increase, the increased cost of operating an inefficient vehicle are greater for households that drive more. Thus, in equilibrium, after an increase in the gasoline prices there should be a stronger matching from households, based on their VMT, to the fuel economy of the cars they own. Potentially, this matching effect could save 15% of US gasoline consumption, even with no effect on individual VMT and no effect on the vehicle fleet. Using confidential data from the National Highway Transportation Survey, the effect of higher gasoline prices on such assortative matching is estimated using a variety of econometric models. For all the different model specifications, the matching effect is significant and quite robust. This is the first study to analyze this re-allocation or matching effect. The second essay, titled Evaluating the Effectiveness of an Environmental Disclosure Policy: an Application to New South Wales, examines the impact of an environmental information disclosure policy on environmental outcomes. The main purpose of introducing an environmental information disclosure strategy is to reduce informational asym [...]