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Is Environmentalism the Right Strategy to Decarbonize the World?

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  • Marini, Marco A.
  • Tarola, Ornella
  • Thisse, Jacques-François

Abstract

We study how the supply of environmentalism, which is de ned by psychic bene ts (costs) associated with the purchase of high-environmental (low-environmental) qualities, a¤ects the way rms choose their products and the ensuing consequences for the global level of pollution. Contrary to general belief, a high supply of environmentalism does not give rise to a better environmental outcome because it endows rms with more market power which they use to maximize pro ts. By contrast, standard policy instruments such as a minimum quality standard or the use of greener technologies leads to a better ecological footprint.

Suggested Citation

  • Marini, Marco A. & Tarola, Ornella & Thisse, Jacques-François, 2020. "Is Environmentalism the Right Strategy to Decarbonize the World?," 2030 Agenda 308106, Fondazione Eni Enrico Mattei (FEEM).
    • Handle: RePEc:ags:feemgc:308106
    DOI: 10.22004/ag.econ.308106
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    Cited by:

    1. Ambec, Stefan & De Donder, Philippe, 2022. "Environmental policy with green consumerism," Journal of Environmental Economics and Management, Elsevier, vol. 111(C).
    2. Dorothée Brécard & Mireille Chiroleu-Assouline, 2024. "Information campaigns and ecolabels by environmental NGOs: Effective strategies to eliminate environmentally harmful components?," Post-Print hal-04592469, HAL.

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    Keywords

    Environmental Economics and Policy;

    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General

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