Price Competition and the Choice of Green Degree Considering Consumer Environmental Awareness

2016 ◽  
Author(s):  
Yantao Ling ◽  
Jing Xu
Author(s):  
Dayi He ◽  
Ximing Deng

Consumer environmental awareness (CEA) can affect green consumption decisions in different and confusing ways. In order to explain the reasons for these divergences, this study divides CEA into two main components: the subjective effect and the social effect. Then, we integrate the two effects into the classic Hotelling model to study the influence of CEA’s subjective effect and social effect on price competition and product differentiation strategy. It was found that the subjective and social effects of CEA have opposite impacts on price competition and product differentiation strategies. The subjective effect of CEA increases the price and profit level of enterprises, and enlarges the difference in the environmental friendliness of products. Meanwhile, the social effect of CEA reduces the enterprises’ price and profit level, and narrows the difference in the environmental quality of products. Therefore, we suggest that it is necessary for producers of green products to distinguish between these two effects. Numerical examples are provided to verify our findings. Finally, some possible suggestions regarding the competition of green products are put forward which take into consideration the subjective and social effects of CEA. The main contribution of this paper is to theoretically explain the opposite effects of the two different components of CEA on environmentally friendly product pricing and differentiation strategy; this presents a possible explanation as to why the behavior regarding CEA differs, and provides theoretical support for enterprises to price and differentiate green products.


2006 ◽  
Vol 7 (3) ◽  
pp. 339-361 ◽  
Author(s):  
Klaus Conrad

Abstract The objective of our approach is to develop a model that captures horizontal product differentiation under environmental awareness with price competition whereby environmentally friendly products are costlier to produce. As an example, we refer to automobile producers offering cars with a gasoline-powered engine and one with a natural gas-powered engine. The network of petrol stations provides the complementary good. We use a two-stage game in prices and characteristics to analyse the market structure. In order to find out whether a private decision on the type of engine coincides with a socially optimal product differentiation, we determine the position of the two types of engine by a welfaremaximizing authority.


Author(s):  
Muhammad Mathori ◽  
Uswatun Chasanah

This study aims to identify the determinants that influence the attitudes of consumers of green purchases and the willingness to pay more on green products, specifically on energy-saving lighting products. The variables studied included environmental knowledge, environmental awareness and perceived effectiveness. The sample of this study was 196 students, but out of 196 respondents after the questionnaire was distributed only 189 could be processed. Validity and reliability test results show valid values of loading factors of more than 0.4 while for reliability testing using the cronbach’s alpha criteria above 0.5 indicates reliable. Through the multiple linear regression analysis, the variables of environmental knowledge, environmental awareness and effectiveness are felt to have a positive and significant effect on the attitude of buying and willingness to pay more. Green purchasing attitudes and willingness to pay more have a positive and significant effect on green purchasing behavior. Green purchasing attitudes have a greater influence on green purchasing behavior compared to willingness to pay more.


2015 ◽  
Vol 3 (2) ◽  
pp. 262-265
Author(s):  
Dr.Navdeep Kaur

Since its evolution environment has remained both a matter of awe and concern to man. The frontier attitude of the industrialized society towards nature has not only endangered the survival of all other life forms but also threatened the very existence of human life. The realization of such potential danger has necessitated the dissemination of knowledge and skill vis-a-vis environment protection at all stages of learning. Therefore, learners of all stages of learning need to be sensitized with a missionary zeal. This may ensure transformation of students into committed citizens for averting global environment crisis. The advancement of science and technology made the life more and more relaxed and man also became more and more ambitious. With such development, human dependence on environment increased. He consumed more resources and the effect of his activities on the environment became more and more detectable. Environment covers all the things present around the living beings and above the land, on the surface of the earth and under the earth. Environment indicates, in total, all of peripheral forces, pressures and circumstances, which affect the life, nature, behaviour, growth, development and maturation of living beings. Irrational exploitation (not utilization) of natural resources for our greed (not need) has endangered our survival, and incurred incalculable harm. Environmental Education is a science, a well-thought, permanent, lasting and integrated process of equipping learning experiences for getting awareness, knowledge, understanding, skills, values, technical expertise and involvement of learners with desirable attitudinal changes about their relationship with their natural and biophysical environment. Environmental Education is an organized effort to educate the masses about environment, its functions, need, importance, and especially how human beings can manage their behaviour in order to live in a sustainable manner.  The term 'environmental awareness' refers to creating general awareness of environmental issues, their causes by bringing about changes in perception, attitude, values and necessary skills to solve environment related problems. Moreover, it is the first step leading to the formation of responsible environmental behaviour (Stern, 2000). With the ever increasing development by modern man, large scale degradation of natural resources have been occurred, the public has to be educated about the fact that if we are degrading our environment we are actually harming ourselves. To encourage meaningful public participation and environment, it is necessary to create awareness about environment pollution and related adverse effects. This is the crucial time that environmental awareness and environmental sensitivity should be cultivated among the masses particularly among youths. For the awareness of society it is essential to work at a gross root level. So the whole society can work to save the environment.


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