Monitoring Eco-Labels: You Can Have Too Much of a Good Thing

Liebi, Thomas (June 2002). Monitoring Eco-Labels: You Can Have Too Much of a Good Thing (Diskussionsschriften 02-07). Bern: Universität Bern Volkswirtschaftliches Institut

Preview

Text dp0207.pdf - Published Version Available under License Creative Commons: Attribution (CC-BY). Download (189kB) | Preview

An increasing number of product labels is making environmental claims. Typically, these claims are non-verifiable to consumers, they represent a credence attribute of the product. The usual way to handle this problem is external monitoring of such labels. We consider a model where firms in a competitive market choose product quality and the intensity of monitoring. It is shown that all the firms producing the high quality credence good will choose the same level of monitoring, i.e., an industry standard will evolve. However, in a competitive equilibrium there will be more monitoring than is socially desirable.

Interest & Impact

Downloads

173 since deposited on 23 Apr 2020
39 in the past 12 months

Citations

5 Citations in Web of Science ®
6 Citations in Scopus

Search

in Google Scholar™

Services

Actions (login required)

Edit item

Actions (login required)

Edit item