Article (Scientific journals)
Green consumption and relative preferences in a vertically differentiated international oligopoly
Zanaj, Skerdilajda; Tarola, Ornella; Ceccantoni, Giulia
2018In Ecological Economics
Peer reviewed
 

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Keywords :
relative preferences; green consumption; vertical differentiation; international oligopoly; trade liberalization.
Abstract :
[en] We consider an open to trade two-country model with two vertically differentiated goods and relative preferences in consumption. These preferences are such that consumers obtain satisfaction from their own consumption in relation to the consumption of the others. Product differentiation is along an environmental quality dimension and countries are asymmetric in average income. Analyzing the equilibrium configuration, we find that, when relative preferences are relegated to the poorer country producing the brown good, the process of trade liberalization can favor the polluting firm, while penalizing the green rival. In these circumstances, trade liberalization can be environmentally detrimental. At the opposite, trade liberalization always favors the green producer when relative preferences are observed in both countries, with possibly positive effects on global emissions.
Disciplines :
International economics
Author, co-author :
Zanaj, Skerdilajda  ;  University of Luxembourg > Faculty of Law, Economics and Finance (FDEF) > Center for Research in Economic Analysis (CREA)
Tarola, Ornella;  Università Sapienza Rome
Ceccantoni, Giulia
External co-authors :
yes
Language :
English
Title :
Green consumption and relative preferences in a vertically differentiated international oligopoly
Publication date :
2018
Journal title :
Ecological Economics
ISSN :
0921-8009
Publisher :
Elsevier Science
Peer reviewed :
Peer reviewed
Available on ORBilu :
since 17 March 2018

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