A study to assess impact of carbon credit trading into costs and prices of different goods and services - a study from the airline industry

Neharika Shrivastava, Vandna Sharma and Barnali Chaklader

International Journal of Global Environmental Issues, 2019, vol. 18, issue 2, 126-141

Abstract: Global climate change has compelled companies to revamp their existing business practices. Increases in CO₂ can only be offset by reforestation or increases in water bodies. The present study of Indian airlines is an attempt to prove how CO₂ emissions can be offset with only a marginal impact on the price of a product or service. When booking air tickets online, passengers can choose to offset CO₂ emissions. The objective of this paper is to study the willingness of air travellers to pay for carbon offsetting and the impact of such payments on ticket price. A questionnaire to measure willingness (using a five-point Likert scale) was sent to 150 air passengers booking tickets through makemytrip.com using judgemental and convenience sampling. Of these, 100 responses were received. Statistical analysis was conducted using a Z-test. While the impact on ticket price ranged from just 1.00% to 1.07%, CO₂ emissions were offset from 44% to 200%. From the survey, 44% of respondents agreed and 25% strongly agreed that they did not mind paying for carbon sequestration while booking tickets and the amount they were willing to pay ranged from Rs. 44 to Rs. 121.

Keywords: carbon offsetting; reforestation; IATA; CNG; International Civil Aviation Organisation; ICAO; aviation; carbon trading; makemytrip.com; air tickets; greenhouse gas reduction. (search for similar items in EconPapers)
Date: 2019
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