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dc.contributor.authorUlph, Alistair
dc.contributor.authorUlph, David
dc.identifier.citationUlph , A & Ulph , D 2018 , ' Environmental policy when consumers value conformity ' , Journal of Environmental Economics and Management , vol. In press .
dc.identifier.otherORCID: /0000-0003-3171-1270/work/59464513
dc.description.abstractWe present a model of consumer behaviour when consumers value conformity and examine the implications for environmental policy. The model shares a feature set out in Dasgupta, Southerton, Ulph and Ulph (2016) of having a structure of preferences for conformity which induces a mass of consumers to adhere exactly to a norm level of consumption (clumping). However we extend our previous analysis by analysing the conditions for the existence and potential uniqueness of consumption norms. In doing so we introduce threshold effects whereby individuals adhere to a norm only if sufficiently many others do so. Taken together these have striking implications for environmental policy in the case where the norm good generates pollution emissions. Clumping means many individuals will not change behaviour unless the norm changes while threshold effects plus clumping means that it may be hard to change a norm. We show that the use of Pigovian taxes to control behaviour may be either ineffective or welfare reducing, and that the optimal Pigovian tax will work only if it is above some threshold level. There are parameter values for which quantity-based injunctive policies raise welfare relative to no intervention while optimal Pigovian taxes would lower welfare.
dc.relation.ispartofJournal of Environmental Economics and Managementen
dc.subjectDesire for conformityen
dc.subjectParticipation-consistent consumption intervalen
dc.subjectDistribution of typesen
dc.subjectExistence of equilibrium consumption normsen
dc.subjectPolicy implicationsen
dc.subjectGE Environmental Sciencesen
dc.subjectHB Economic Theoryen
dc.subjectHD61 Risk Managementen
dc.subjectSDG 12 - Responsible Consumption and Productionen
dc.titleEnvironmental policy when consumers value conformityen
dc.typeJournal articleen
dc.contributor.institutionUniversity of St Andrews. School of Economics and Financeen
dc.description.statusPeer revieweden

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