Ambec, Stefan and De Donder, Philippe (2020) Environmental policy with green consumerism. TSE Working Paper, n. 20-1124, Toulouse

Warning
There is a more recent version of this item available.
[thumbnail of wp_tse_1124.pdf]
Preview
Text
Download (1MB) | Preview

Abstract

Is green consumerism beneficial to the environment and the economy? To shed light on this question, we study the political economy of environmental regulations in a model
with neutral and green consumers where the latter derive some warm glow from buying a good of higher environmental quality produced by a profit-maximizing monopoly,
while the good bought by neutral consumers is provided by a competitive fringe. Consumers unanimously vote for a standard set at a lower than first-best level, or for a tax
delivering the first-best environmental protection level. Despite its under-provision of environmental protection, the standard dominates the tax from a welfare perspective
due to its higher productive efficiency, i.e., a smaller gap between the environmental qualities of the two goods supplied. In stark contrast, voters unanimously prefer a tax
to a standard when the willingness to pay for greener goods is small enough.

Item Type: Monograph (Working Paper)
Language: English
Date: July 2020
Place of Publication: Toulouse
Uncontrolled Keywords: environmental regulation, corporate social responsibility, green consumerism, product differentiation, tax, standard, green label, political economy.
JEL Classification: D24 - Production; Cost; Capital and Total Factor Productivity; Capacity
D62 - Externalities
Q41 - Demand and Supply
Q42 - Alternative Energy Sources
Q48 - Government Policy
Subjects: B- ECONOMIE ET FINANCE
Divisions: TSE-R (Toulouse)
Institution: Université Toulouse Capitole
Site: UT1
Date Deposited: 21 Jul 2020 12:47
Last Modified: 03 Jan 2022 14:13
OAI Identifier: oai:tse-fr.eu:124431
URI: https://publications.ut-capitole.fr/id/eprint/41568

Available Versions of this Item

View Item

Downloads

Downloads per month over past year