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Hedonic quality, social norms, and environmental campaigns

Author

Listed:
  • Andrea Mantovani

    () (University of Bologna & IEB)

  • Ornella Tarola

    () (University of Rome "La Sapienza")

  • Cecilia Vergari

    () (University of Bologna)

Abstract

We analyse how market competition in a vertically differentiated polluting industry is affected by product variants that comply at different levels with "green" social norms. A green consumption behavior is considered as a byword of good citizenship. Consumer preferences depend on a combination of hedonic quality and compliance with social norms. Assuming that the high hedonic quality variant complies less with these norms than the low hedonic quality variant, we characterize different equilibrium configurations which appear as a result of both the intensity of such norms and the country-specific income dispersion. Then, we focus on the role that institutions may have in using these norms to reduce pollution emissions.

Suggested Citation

  • Andrea Mantovani & Ornella Tarola & Cecilia Vergari, 2014. "Hedonic quality, social norms, and environmental campaigns," Working Papers 2014/36, Institut d'Economia de Barcelona (IEB).
  • Handle: RePEc:ieb:wpaper:2013/6/doc2014-36
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    References listed on IDEAS

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    Keywords

    Hedonic quality; environmental quality; relative preferences; environmental campaign;

    JEL classification:

    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • H13 - Public Economics - - Structure and Scope of Government - - - Economics of Eminent Domain; Expropriation; Nationalization

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