Hedonic Quality, Social Norms, and Environmental Campaigns

IEB Working Paper N. 2014/36

37 Pages Posted: 11 Dec 2014

See all articles by Andrea Mantovani

Andrea Mantovani

University of Bologna

Ornella Tarola

University of Rome I

Cecilia Vergari

University of Bologna - Department of Economics

Date Written: November 20, 2014

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.

Keywords: Hedonic quality, environmental quality, relative preferences, environmental campaign

JEL Classification: D62, L13, H13

Suggested Citation

Mantovani, Andrea and Tarola, Ornella and Vergari, Cecilia, Hedonic Quality, Social Norms, and Environmental Campaigns (November 20, 2014). IEB Working Paper N. 2014/36. Available at SSRN: https://ssrn.com/abstract=2535955 or http://dx.doi.org/10.2139/ssrn.2535955

Andrea Mantovani (Contact Author)

University of Bologna ( email )

Piazza Scaravilli 2
Bologna, 40126
Italy

Ornella Tarola

University of Rome I ( email )

Piazzale Aldo Moro 5
Roma, Rome 00185
Italy

Cecilia Vergari

University of Bologna - Department of Economics ( email )

Piazza Scaravilli 2
Bologna, 40100
Italy

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