Consumer support for environmental policies: an application to purchases of green cars

Coad, Alex, De Haan, Peter and Woersdorfer, Julia Sophie (2009) Consumer support for environmental policies: an application to purchases of green cars. Ecological Economics, 68 (7). pp. 2078-2086. ISSN 0921-8009

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This paper focuses on how consumer motivation can be tapped in order to encourage the adoption of cleaner technologies. Consumers are heterogeneous — they may be guided by intrinsic motivation or extrinsic motivation. While information provision policies (such as the energy label for cars) may be effective in encouraging certain consumers to adopt green cars, financial incentive schemes (such as subsidies or fines) may be more persuasive for extrinsically-motivated consumers. We develop a dynamic theory of adoption of environmental innovations, in which information-provision policies are followed by financial incentives (first ‘carrot’, then ‘stick’ incentives). Analysis of a survey dataset of Swiss households observes considerable heterogeneity in terms of support of information-provision or financial incentive policies, in line with our conjectures. Our results will be of particular interest to policymakers interested in guiding consumers towards cleaner technologies.

Item Type: Article
Keywords: Environmental policy; Technology adoption; Technology diffusion; Intrinsic motivation; Financial incentives
Schools and Departments: School of Business, Management and Economics > SPRU - Science Policy Research Unit
Subjects: H Social Sciences > HE Transportation and communications > HE0305 Urban transportation
Depositing User: Alex Coad
Date Deposited: 03 Jul 2012 11:41
Last Modified: 03 Jul 2012 11:41
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