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Green Consumerism and Non-Profit Firms: A New Approach toward Better Environmental Protection

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  • Marta Tarani

    () (University of Florence)

Abstract

The objective of this paper is to illustrate how the introduction of environmentally friendly, non-profit firms can improve environmental market outcomes by decreasing pollution from production. In particular such a market setting is shown, quite generally, to deliver increased environmental benefits as the mass of consumers with environmental preferences increases. This result, while seemingly intuitive, has not always resulted from settings featuring solely profit maximizing firms. We highlight the importance of a non-profit firm in the market by contrasting the results obtained in two previous models with our results, which we derive from these same models, imposing the existence of a nonprofit firm in the market. From a policy perspective, the promotion of non-profit firms in markets, along with the establishment of policies aimed at increasing environmental awareness by consumers, may constitute a form of public intervention in favour of the environment as an alternative to those traditionally employed e.g. taxes and subsidies.

Suggested Citation

  • Marta Tarani, 2009. "Green Consumerism and Non-Profit Firms: A New Approach toward Better Environmental Protection," Rivista di Politica Economica, SIPI Spa, vol. 99(4), pages 205-241, OCTOBER-D.
  • Handle: RePEc:rpo:ripoec:v:99:y:2009:i:4:p:205-241
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    References listed on IDEAS

    as
    1. Bela Balassa, 1964. "The Purchasing-Power Parity Doctrine: A Reappraisal," Journal of Political Economy, University of Chicago Press, vol. 72, pages 584-584.
    2. Drechsler, Laszlo, 1973. "Weighting of Index Numbers in Multilateral International Comparisons," Review of Income and Wealth, International Association for Research in Income and Wealth, vol. 19(1), pages 17-34, March.
    3. Declich Carlo & Polin Veronica, 2005. "Povertà assoluta e costo della vita: un'analisi empirica sulle famiglie italiane," Politica economica, Società editrice il Mulino, issue 2, pages 265-306.
    4. Albert Alesina & Stephan Danninger & Massimo Rostagno, 2001. "Redistribution Through Public Employment: The Case of Italy," IMF Staff Papers, Palgrave Macmillan, vol. 48(3), pages 1-2.
    5. Riccardo Massari & M. Grazia Pittau & Roberto Zelli, 2010. "Does regional cost-of-living reshuffle Italian income distribution?," Working Papers 166, ECINEQ, Society for the Study of Economic Inequality.
    6. Manuela Nenna, 2002. "Deviations from Purchasing Power Parity: Any Role for the Harrod-Balassa-Samuelson Hypothesis?," Rivista di Politica Economica, SIPI Spa, vol. 92(4), pages 167-196, July-Augu.
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    More about this item

    Keywords

    green consumerism; product differentiation; mixed duopoly;

    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L21 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Business Objectives of the Firm
    • Q20 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - General

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