1887

OECD Environment Working Papers

This series is designed to make available to a wider readership selected studies on environmental issues prepared for use within the OECD. Authorship is usually collective, but principal authors are named. The papers are generally available only in their original language English or French with a summary in the other if available.

English

Sustainable consumption dilemmas

Consumers only occasionally choose to buy sustainable products. At the same time these consumers say in surveys that sustainability is important to them, and that the government should promote sustainable consumption. Most likely, a social dilemma is at play here. Everyone would be better off if we all consume sustainably; but because of the higher prices for sustainable products, there is an incentive for each individual to leave sustainability efforts to others. Government measures to promote sustainable consumption would resolve the social dilemma. But do consumers really want to increase sustainability? This study takes a closer look at public support for sustainable consumption and the associated dilemmas, with the help of a behavioural economics experiment of group decisions. In the experiment, participants had to decide whether they were willing to buy more sustainable varieties of meat or chocolate instead of less sustainable conventional varieties. They actually had to buy the product agreed upon for one week. The results show that a large number of participants, who did not usually buy sustainable products, were willing to commit to buying sustainable products. This gap may partially be explained by ‘conditional cooperation’ phenomena. In addition participants appear insensitive to the size of the collective benefit. However, the participants in our experiment seem to have difficulties to force others to buy sustainable products. They seem to be caught in a moral dilemma in which they weigh the feel-good effect of contributing to a collective good against the higher individual costs of buying sustainable products and forcing others to do so. Also we found that the preference of the participants for, or dislike of, a measure beforehand did not say much about their appreciation of the measure afterwards. Based on the results we draw the following policy conclusions. Since consumers do not always act in accordance with their values, the presently low market shares of sustainable products do not adequately reflect consumer support for government policy to promote sustainable consumption. To stimulate consumption of sustainable products, it may be useful to emphasize the feel-good effect (‘warm glow’) of individual contributions to sustainability. Furthermore, the government could make use of the fact that most consumers are ‘conditionally cooperative’, e.g. by convincing individual consumers that enough others are switching to sustainable products, too. In this context, it appears that consumers prefer ‘soft’ incentive measures (e.g. subsidies) over ‘hard’ restrictive regulations, even if their individual financial benefit from the former will be smaller. The freedom of choice is apparently worth it. However, rules and regulations, even in the form of bans of less sustainable product varieties, can be acceptable and more effective – as long as the government takes the lead in setting up these rules and regulations.

English

Keywords: household economics, sustainable consumption, conditional cooperation
JEL: D12: Microeconomics / Household Behavior and Family Economics / Consumer Economics: Empirical Analysis; D11: Microeconomics / Household Behavior and Family Economics / Consumer Economics: Theory
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