Heyes, A. and Kapur, Sandeep and Kennedy, P.W. and Martin, S. and Maxwell, J.W. (2018) But what does it mean? Competition between products carrying alternative green labels when consumers are active acquirers of information. Working Paper. Department of Economics, Mathematics and Statistics, London, UK. (Submitted)
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Abstract
Programs that certify the environmental (or other social) attributes of firms are common. But the proliferation of labeling schemes makes it difficult for consumers to know what each one mean – what level of `greenness' does a particular label imply? We provide the first model in which consumers can expend effort to learn what labels mean. The relationship between information acquisition costs, firm pricing decisions, the market shares obtained by alternatively-labeled goods and a brown `backstop' good, and total environmental impact prove complex. Consumer informedness can have perverse implications. In plausible cases a reduction in the cost of information damages environmental outcomes. Our results challenge the presumption that provision of environmental information to the public is necessarily good for welfare or the environment.
Metadata
| Item Type: | Monograph (Working Paper) |
|---|---|
| Additional Information: | BWPEF 1812 |
| Keyword(s) / Subject(s): | Eco-labeling, green consumerism, information-based instruments |
| School: | Birkbeck Faculties and Schools > Faculty of Business and Law > Birkbeck Business School |
| Research Centres and Institutes: | Innovation Management Research, Birkbeck Centre for |
| Depositing User: | Sandeep Kapur |
| Date Deposited: | 09 Jan 2019 15:03 |
| Last Modified: | 02 Aug 2023 17:46 |
| URI: | https://eprints.bbk.ac.uk/id/eprint/25404 |
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