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Policies as Information Carriers: How Environmental Policies May Change Beliefs and Consequent Behavior

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  • Ann-Kathrin Koessler
  • Stefanie Engel

Abstract

This paper discusses how policy interventions not only alter the legal and financial frameworks in which an individual is operating, but can also lead to changes in relevant beliefs. We argue that such belief changes in how an individual perceives herself, relevant others, the regulator and/or the activity in question can lead to behavioral changes that were neither intended nor expected when the policy was designed. In the environmental economics literature, these secondary impacts of conventional policy interventions have not been systematically reviewed. Hence, we intend to raise awareness of these effects. In this paper, we review relevant research from behavioral economics and psychology, and identify and discuss the domains for which beliefs can change. Lastly, we discuss design options with which an undesired change in beliefs can be avoided when a new policy is put into practice.

Suggested Citation

  • Ann-Kathrin Koessler & Stefanie Engel, 2021. "Policies as Information Carriers: How Environmental Policies May Change Beliefs and Consequent Behavior," International Review of Environmental and Resource Economics, now publishers, vol. 15(1-2), pages 1-31, July.
    • Handle: RePEc:now:jirere:101.00000123
    DOI: 10.1561/101.00000123
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    Cited by:

    1. Mattauch, Linus & Hepburn, Cameron & Spuler, Fiona & Stern, Nicholas, 2022. "The economics of climate change with endogenous preferences," Resource and Energy Economics, Elsevier, vol. 69(C).
    2. Bähr, Tobias & Bernal-Escobar, Adriana & Wollni, Meike, 2025. "Can payments-for-ecosystem-services change social norms?," Ecological Economics, Elsevier, vol. 228(C).
    3. Guodong Xu & Ying Zhou & Yifan Zhou, 2024. "Research on the evolutionary mechanism and optimum control of pro-environmental behavior of polluting enterprises driven by environmental policies," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 26(9), pages 22085-22101, September.
    4. Ortiz-Riomalo, Juan Felipe & Koessler, Ann-Kathrin & Engel, Stefanie, 2022. "Fostering co-operation through participation in natural resource management. An integrative review," EconStor Preprints 253261, ZBW - Leibniz Information Centre for Economics.

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    Keywords

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    JEL classification:

    • D01 - Microeconomics - - General - - - Microeconomic Behavior: Underlying Principles
    • D80 - Microeconomics - - Information, Knowledge, and Uncertainty - - - General
    • D90 - Microeconomics - - Micro-Based Behavioral Economics - - - General
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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