Greenwashing and Product Market Competition
14 Pages Posted: 2 Mar 2021 Last revised: 7 Mar 2023
Date Written: January 7, 2021
This study examines the relationship between corporate greenwashing and product market competition (PMC). Using an unbalanced panel of 324 US firms over the 2005-2015 period, we find that the negative impact of PMC on greenwashing is conditional on the level of environmental costs. Our results suggest that PMC is an effective disciplinary mechanism for achieving economic efficiency --in the case of firms featuring a high level of environmental costs-- through an increase in the disclosure of reliable and material information.
Keywords: Greenwashing, Product market competition, Environmental cost
JEL Classification: M14, G32, L10
Suggested Citation: Suggested Citation