Environmental Degradation and the Limits to LOV

Yu-Fu Chen, Hassan Molana and Catia Montagna

No 234, Dundee Discussion Papers in Economics from Economic Studies, University of Dundee

Abstract: We show how consumers’ environmental concerns may limit ‘love of variety’ (LOV) and be reflected in consumers decisions. We investigate how the impact of environmental degradation on LOV influences demand and optimal product variety, and how a pollution tax on firms might be used to improve upon the market outcome and increase welfare.

Keywords: Environmental degradation; love-of-variety; environmental policy (search for similar items in EconPapers)
JEL-codes: L1 Q2 (search for similar items in EconPapers)
Pages: 5 pages
Date: 2010-04
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Working Paper: Environmental Degradation and the Limits to LOV (2010)
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