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Competition and Co-Operation when Consumers' Sustainability Preferences Depend on Social Norms

Roman Inderst, Eftichios Sartzetakis () and Anastasios Xepapadeas ()

No 2109, DEOS Working Papers from Athens University of Economics and Business

Abstract: We posit that consumers' preferences for more sustainable products depend on the perceived social norm, which in turn is shaped by average consumption in society. We explore the implications of such preferences for firms' incentives to introduce more sustainable products and to co-operate in order to either foster or forestall their introduction. Our main motivation lies in the increasing pressure put on antitrust authorities to exert more leniency towards horizontal agreements that are motivated by sustainability considerations.

Date: 2021-07-30
New Economics Papers: this item is included in nep-com, nep-env, nep-isf and nep-soc
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