How to prevent “greenwash” in green retrofit process under PPP model: an evolutionary game theory-based analysis

Yuan Ren, Pengwei Yuan, Xiaoqing Dong and Hongkai Liu

Applied Economics, 2025, vol. 57, issue 16, 1888-1908

Abstract: In the Public-Private Partnership for Existing Building Green Retrofitting (PPP-EBGR) model, collaboration between the government and social capital facilitates the completion of retrofitting projects by reducing the financial burden on the government, making it widely utilized in the field of green building. However, behaviours such as ‘greenwashing’ among businesses through rent-seeking and loose government regulation can compromise the quality of PPP-EBGR projects. We establish a tripartite evolutionary game model to investigate and analyse the decision-making behaviours of developers in complying with qualified standards, testing agencies engaging in rent-seeking with developers, and the government enforcing strict supervision. The study derives a systemic equilibrium and utilizes simulation to validate the findings. The results indicate that project revenue incentivizes developers to enhance compliance. An increase in rent-seeking costs is conducive to reducing the intentions of agencies to engage in rent-seeking. Moreover, a greater number of rewards and penalties from the government promote developer compliance and discourage agency rent-seeking. Dynamic mechanisms prove more effective in achieving an ideal equilibrium in the system. Interestingly, we find that dynamic mechanisms, with fewer rewards and penalties imposed, still yield superior results compared to static mechanisms.

Date: 2025
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DOI: 10.1080/00036846.2024.2317812

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