What government policies may affect the demand for light bulbs?

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kipling2448 | (Level 3) Educator Emeritus

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Government policies that affect the demand for light bulbs generally involve the implementation, overseen by the US Department of Energy, of federal laws intended to reduce energy consumption among Americans. Chief among these laws is the Energy Conservation and Production Act of 1976, since amended a number of times, most recently in 2014 with passage of Public Law 113-128. The Energy Conservation and Production Act (ECPA) was an early attempt at addressing the nation's reliance on overseas sources of oil and minerals important to industry. Passed in the wake of the 1973 OPEC oil embargo directed by Arab nations against the United States in response to US support for Israel following the Egyptian and Syrian surprise attack on the Jewish state, the ECPA would prove largely ineffectual; later reductions in the price of oil disincentivized industry from investing in the research and development needed to create more energy-efficient technologies and processes. While the ECPA, in its initial version, failed to adequately address the problem of energy efficiency, though, it did set the United States on a course toward greater attention to the need to develop more efficient energy alternatives.

Today, federal laws, mainly those amending the original 1976 ECPA directly affect the demand for light bulbs by mandating that more efficient bulbs be designed into the construction of both public and private buildings. For example, as the government has mandated the phasing-out of incandescent bulbs in favor of longer-lasting, more energy efficient LED bulbs (which, unfortunately, include the highly toxic chemical mercury in their construction), the requirement for replacement bulbs has reduced demand for light bulbs on the whole. In short, by requiring the use of more efficient, longer-lasting light bulbs, the government has reduced the demand for bulbs -- or, at least, that was the intent. This, then, is the principal way government policies affect demand for this particular product. Requirements for more energy efficient buildings means, invariably, lower demand for light bulbs during the life of those buildings.

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