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Offset carbon emissions or pay a price premium for avoiding them? A cross-country analysis of motives for climate protection activities

Author

Listed:
  • Claudia Schwirplies

    (University of Kassel)

  • Andreas Ziegler

    (University of Kassel)

Abstract

This paper contributes to the economic literature on pure and impure public goods by consid-ering two alternatives for contributing to the public good climate protection: compensating carbon emissions from conventional consumption or paying higher prices for climate-friendly products. We analytically and empirically examine a wide range of motives and their impact on individuals’ choice in favor of these two alternatives. Relying on data from representative surveys among more than 2000 participants from Germany and the USA, our results indicate that environmental awareness, warm glow motives, and the desire to set a good example sig-nificantly motivate the choice of both climate protection activities in both countries. However, some motives differ considerably between both alternatives and countries. A green identity enhances the willingness to pay a price premium for climate-friendly goods or services in Germany, while social norms seem to be of much higher relevance in the USA. Our results further suggest that the choice of climate protection activities, especially of carbon offsetting, entails a high degree of uncertainty.

Suggested Citation

  • Claudia Schwirplies & Andreas Ziegler, 2015. "Offset carbon emissions or pay a price premium for avoiding them? A cross-country analysis of motives for climate protection activities," MAGKS Papers on Economics 201504, Philipps-Universität Marburg, Faculty of Business Administration and Economics, Department of Economics (Volkswirtschaftliche Abteilung).
  • Handle: RePEc:mar:magkse:201504
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    File URL: http://www.uni-marburg.de/fb02/makro/forschung/magkspapers/paper_2015/04-2015_schwirplies.pdf
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    References listed on IDEAS

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    2. Groh, Elke D. & Möllendorff, Charlotte v., 2020. "What shapes the support of renewable energy expansion? Public attitudes between policy goals and risk, time, and social preferences," Energy Policy, Elsevier, vol. 137(C).

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    More about this item

    Keywords

    Public good; climate change; climate protection; carbon offsetting; price premium;
    All these keywords.

    JEL classification:

    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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