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    But what does it mean? Competition between products carrying alternative green labels when consumers are active acquirers of information

    Heyes, A. and Kapur, Sandeep and Kennedy, P. and Martin, S. (2019) But what does it mean? Competition between products carrying alternative green labels when consumers are active acquirers of information. Journal of the Association of Environmental and Resource Economists , ISSN 2333-5955. (In Press)

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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 means -- 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 proves 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: Article
    Keyword(s) / Subject(s): Eco-labeling, green consumerism, information-based instruments
    School: Birkbeck Schools and Departments > School of Business, Economics & Informatics > Economics, Mathematics and Statistics
    Depositing User: Sandeep Kapur
    Date Deposited: 23 Oct 2019 17:39
    Last Modified: 25 Oct 2019 09:28
    URI: http://eprints.bbk.ac.uk/id/eprint/29610

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