Greening or greenwashing? How consumers’ beliefs influence firms’ advertising strategies on environmental quality

Lucie Bottega (), Dorothée Brécard and Philippe Delacote
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Lucie Bottega: Toulouse School of Economics, LERNA

No 2023.05, Working Papers from FAERE - French Association of Environmental and Resource Economists

Abstract: When consumers have ambiguous beliefs about the green quality of products, firms may be tempted to "greenwash". The degrees of optimism and confidence of consumers then play a crucial role in firms’ advertising strategies, which can be either informative and/or persuasive. We find conditions under which advertising efforts and environmental quality are substitutes and thus lead to greenwashing.

Keywords: ambiguity; vertical differentiation; information; advertising; greenwashing (search for similar items in EconPapers)
JEL-codes: D11 D21 D83 L15 Q59 (search for similar items in EconPapers)
Pages: 12 pages
Date: 2023-07
New Economics Papers: this item is included in nep-ene and nep-env
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http://faere.fr/pub/WorkingPapers/Bottega_Brecard_Delacote_FAERE_WP2023.05.pdf First version, 2019 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:fae:wpaper:2019.nn

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