Recent ioes items

Using Market Forces for Social Good

Wed, 2 Oct 2019 00:00:00 +0000

The environment has traditionally been the domain of nonprofit organizations. For decades, nonprofit organizations have worked to reduce the negative impact of market-based activity on the environment. However, more recently nonprofits have started to adopt the methods and values of the market to achieve sustainability goals. One of the primary strategies that nonprofits use is to disclose, or pressure corporations to disclose, information about the environmental impact of their products and processes. These information disclosure strategies seek to help stakeholders make green purchases or invest in corporations that use green practices, thus incentivizing corporations to reduce their negative environmental impact. In this chapter, we review the benefits and the challenges encountered by nonprofits in their attempt to use information disclosure strategies.

Field Experiments in Corporate Sustainability Research: Testing Strategies for Behavior Change in Markets and Organizations

Fri, 29 Sep 2017 00:00:00 +0000

Experimental studies are a valuable tool to test effective strategies for encouraging sustainable behavior but have not been used much in corporate sustainability research. In this article, we describe the benefits and challenges of the randomized field experimental method for research in corporate sustainability. We draw on the examples of our own research in energy conservation behavior to illustrate some of the hurdles that need to be overcome for the successful implementation of field experiments.

Information Strategies for Energy Conservation: A Field Experiment in India, 2017

Fri, 29 Sep 2017 00:00:00 +0000

Little is known about the effectiveness of information strategies on energy conservation in developing countries. In this study, we conduct a field experiment in an apartment complex in India to test how information about electricity usage impacts the electricity consumption of urban middle class households. Our results, based on fifteen-minute electricity readings over an academic year, show that nonmonetary messages that framed electricity consumption in terms of environmental and health impacts were more effective than messages emphasizing the monetary savings of reducing electricity consumption. Households in the environmental/health group accessed the online energy-monitoring dashboard more frequently and reduced their electricity usage by 18.4% relative to the control group. Households in the monetary group did not significantly alter their usage. These results about revealed preferences are contrasted with stated preferences disclosed in a survey of urban Indians who describe...

Organizational Configurations for Sustainability and Employee Productivity: A Qualitative Comparative Analysis Approach

Fri, 21 Apr 2017 00:00:00 +0000

We propose a model that identifies the configurations of relations between environmental practices and other management practices that can improve employee performance, measured as labor productivity. To test our model, we use the qualitative comparative analysis (QCA) methodology, which allows us to demonstrate empirically how different configurations of management practices, including environmental practices, quality management systems, teamwork, and interorganizational relations, contribute to work systems in ways that increase labor productivity. Our results, based on data from 4,975 employees from 1,866 firms, show that environmental practices are associated with higher labor productivity only when they are combined with other management practices.

THE DYNAMICS OF BEHAVIOR CHANGE:EVIDENCE FROM ENERGY CONSERVATION

Mon, 11 Apr 2016 00:00:00 +0000

Little is known about the effect of message framing on conservation behavior over time. In a randomized controlled trial with residential households, we use advanced metering and information technologies to test how different messages about household energy use impact thedynamics of conservation behavior down to the appliance level. Our results, based on 374 million panel observations of kilowatt-hour (kWh) electricity consumption for 118 householdsover 9 months, show that differences in behavioral responses due to message framing become more significant over time. We find that a health-based frame, in which households consider thehuman health effects of their marginal electricity use, induced persistent energy savings behavior of 8-10% over 100 days; whereas a more traditional cost savings frame, drove sharp attenuationof treatment effects after 2 weeks with no significant savings versus control after 7 weeks. We discuss implications for the design...

Does Organic Wine Taste Better? An Analysis of Experts' Ratings

Tue, 12 Jan 2016 00:00:00 +0000

Eco-labels are part of a new wave of environmental policy that emphasizes information disclosure as a tool to induce environmentally friendly behavior by both firms and consumers. Little consensus exists as to whether eco-certified products are actually better than their conventional counterparts. This paper seeks to understand the link between eco-certification and product quality. We use data from three leading wine rating publications (Wine Advocate, Wine Enthusiast, and Wine Spectator) to assess quality for 74,148 wines produced in California between 1998 and 2009. Our results indicate that eco-certification is associated with a statistically significant increase in wine quality rating.

Corporate Environmental Performance and Lobbying

Wed, 20 May 2015 00:00:00 +0000

In 2013, the energy and natural resources sector spent $359 million lobbying. Such spending is largely perceived as a strategy by industry to oppose regulation. Research has barely begun to investigate how firm-level performance on salient political issues affects corporate political strategy. In this paper, we address this issue in the context of the recent climate change policy debate in the United States. We hypothesize a U-shaped relationship between greenhouse gas (GHG) emissions and lobbying expenditures. To test our hypothesis, our study leverages novel data on firm-level GHG emissions and lobbying expenses aimed specifically at climate change legislation. Our results based on 3,194 firm-observations during a 4 year-period, suggest that both dirty and clean firms are active in lobbying, which challenges the view of adversarial corporate strategy.

Best Practices for Southern California Coastal Wetland Restoration and Management in the Face of Climate Change

Wed, 17 Dec 2014 00:00:00 +0000

Best Practices for Southern California Coastal Wetland Restoration and Management in the Face of Climate Change

Greenhouse gas performance standards: From each according to his emission intensity or from each according to his emissions?

Fri, 5 Dec 2014 00:00:00 +0000

Greenhouse gas performance standards: From each according to his emission intensity or from each according to his emissions?

WHAT CAN WE LEARN FROM HIGH FREQUENCY APPLIANCE LEVEL ENERGY METERING? RESULTS FROM A FIELD EXPERIMENT

Mon, 24 Nov 2014 00:00:00 +0000

This study uses hourly appliance-level electricity consumption data for 124 apartments over 24 months to provide a better understanding of appliance-level electricity consumption behavior. We conduct our analysis in a standardized set of apartments with similar appliances, which allows us to identify behavioral differences in electricity use. The results show that households’ estimations of appliance-level consumption are inaccurate and that they overestimate lighting use by 60% and underestimate HVAC and plug-load by 40%. We find that similar households using the same major appliances exhibit substantial variation in appliance-level electricity consumption. Additionally, we show that behavior accounts for 25-58% of this variation. Lastly, we find that replacing the existing refrigerator with a more energy-efficient model leads to overall energy savings of approximately 11%, which is equivalent to results from behavioral interventions targeting all appliances but might not be...

Eco-Premium or Eco-Penalty? Eco-labels and quality in the organic wine market

Thu, 21 Aug 2014 00:00:00 +0000

Eco-labels emphasize information disclosure as a tool to induce environmentally friendly behaviors by both firms and consumers. The goal of eco-labels is to reduce information asymmetry between producers and consumers over the environmental attributes of a product or service. However, by focusing on this information asymmetry, rather than how the label meets consumer needs, eco-labels may send irrelevant, confusing or even detrimental messages to consumers. In this paper, we investigate how the environmental signal of eco-labels interacts with product characteristics such as brand, quality and price. In a discrete choice experiment the authors examine consumer response to two similar eco-labels for wine, one associated with a quality reduction and the other not. Our results show that respondents preferred both eco-labeled wines over otherwise identical conventional counterparts, when the price was lower and the wine was from a lower quality region. However they preferred conventional...

Production Frontier Methodologies and Efficiency as a Performance Measure in Strategic Management Research

Mon, 14 Oct 2013 00:00:00 +0000

The measurement of corporate performance is central to strategic management research. A common objective of this research is to identify top performers in an industry and their sources of competitive advantage. Despite this focus on best firms and practices, most researchers utilize statistical methods that identify average effects in a sample, and they assess a single performance dimension while ignoring other relevant dimensions. Emphasis on purely financial measures can overlook the fact that a firm’s efficiency in transforming resources has been shown as a major source of competitive advantage. In this article we demonstrate how frontier methodologies, such as Data Envelopment Analysis and the Stochastic Frontier approach, can address these challenges. We provide an illustration based on longitudinal data from U.S. and Japanese automobile producers.

Information Strategies and Energy Conservation Behavior: A Meta-analysis of Experimental Studies from 1975-2012

Thu, 23 May 2013 00:00:00 +0000

Strategies that provide information about the environmental impact of activities are increasingly seen as effective to encourage conservation behavior. This article offers the most comprehensive meta-analysis of information based energy conservation experiments conducted to date. Based on evidence from 156 published field trials and 525,479 study subjects from 1975 to 2012, we quantify the energy savings from information based strategies. On average, individuals in the experiments reduced their electricity consumption by 7.4%. Our results also show that strategies providing individualized audits and consulting are comparatively more effective for conservation behavior than strategies that provide historical, peer comparison energy feedback. Interestingly, we find that pecuniary feedback and incentives lead to a relative increase in energy usage rather than induce conservation. We also find that the conservation effect diminishes with the rigor of the study, indicating potential...

Information Strategies and Energy Conservation Behavior: A Meta-analysis of Experimental Studies from 1975-2011

Wed, 27 Feb 2013 00:00:00 +0000

Strategies that provide informationabout the environmental impact of activitiesare increasingly seen as effective toencourage conservation behavior.This article offers the most comprehensive meta-analysis of information based energy conservation experiments conducted to date. Based on evidence from 156 published field trials and 525,479 study subjects from 1975-2012, we quantify the reduction potential of information based strategies for energy conservation. On average, individuals in the experiments reduced their electricity consumption by 7.4%.Our results also show that strategies providing individualized audits and consulting are comparatively more effective for conservation behavior than strategies that provide historical, peer comparison energy feedback. Interestingly, we find that pecuniary feedback and incentives lead to a relative increase in energy usage rather than induce conservation.We also find that the effect varies with the rigor of the study, indicating potential...

The relationship between policy choice and the size of the policy region: Why small jurisdictions may prefer renewable energy policies to reduce CO2 emissions

Wed, 19 Dec 2012 00:00:00 +0000

We analyze how the size of the policy jurisdiction affects policy choice for the goal of reducingcarbon dioxide (CO2) emissions from electric power generation. We compare three policies, a CO2 tax, a clean energy standard (CES) and a renewable portfolio standard (RPS). For emissions reduction targets achievable under all three policies, a CO2 tax is the most cost-effective policy, while an RPS is the least cost-effective. However, when the policy region does not cover the entire market, an RPS can achieve larger reductions in CO2 emissions than can a CES or CO2 tax. The smaller the policy region, the larger the difference between the maximum emissions reduction achievable by an RPS and that achievable by a CES or CO2 tax. For a sufficiently small policy region, only a renewables-based policy reduces global emissions.This provides one rationale for small jurisdictions to prefer a renewables-based policy over a pollution-based policy.

Multi-criteria comparison of fuel policies: Renewable fuel mandate, fuel emission-standards, and fuel carbon tax

Mon, 26 Nov 2012 00:00:00 +0000

We develop a two-region partial equilibrium model of the global market for liquid fuels to analyze different fuel policies based on multiple criteria, including greenhouse gas (GHG) emissions, expenditure of fuel imports, and the impact on fuel consumers and producers. We find that while ethanol policies may lower gasoline price in the home region, they increase the price of other oil products. A carbon tax increases prices of all fuels. For current sources of ethanol, reduction in GHG emissions due to the substitution of gasoline with ethanol in domestic markets may be dominated by the increase the global emissions because of price effects. Policy makers' preference for ethanol mandates reveals a desire to lower the cost of gasoline and to support the domestic biofuel sector while the selection of an emission-standard reveals a desire to reduce GHG emissions and minimize the impact on fuel consumers.

Mid-Century Warming in the Los Angeles Region - Part I of the “Climate Change in the Los Angeles Region” projec

Wed, 8 Aug 2012 00:00:00 +0000

Using a combination of dynamical and statistical downscaling techniques, we projected mid-21stcentury warming in the Los Angeles region at 2-km (1.2-mile) resolution. To account for uncertainty associated with the trajectory of future greenhouse gas emissions and other factors affecting the planet's energy balance, we examined projections for both "business-as-usual" (RCP8.5) and "mitigation" (RCP2.6) emissions scenarios of the Fifth Coupled Model Intercomparison Project. To account for the considerable uncertainty associated with choice of global climate model, we downscaled results for all available global models. For the business-as-usual scenario, we find that by the mid-21stcentury, the most likely warming is roughly 4.6°F averaged over the region's land areas, with a 95% confidence that the warming lies between 1.7 and 7.5°F. The high resolution of the projections reveals a pronounced spatial pattern in the warming: High elevations and inland areas separated from the...

Saving Power to Conserve Your Reputation?

Fri, 20 Apr 2012 00:00:00 +0000

Environmental damage is often an unseen byproduct of other activities. Disclosing environmental impact privately to consumers can reduce the costs and/or increase the moral benefits of conservation behaviors, while publicly disclosing such information can provide an additional motivation for conservation - cultivating a green reputation. In a unique field experiment, we test the efficacy of private and public information on electricity conservation. Private information was given through real-time feedback and social norms over usage, and public information was given through a publicly visible conservation rating. While private information alone was ineffective, public information motivated a 20 percent reduction in electricity consumption.

Sustainability and Market Conditions:The Resource Efficiency paradox

Fri, 20 Jan 2012 00:00:00 +0000

In this paper we analyze the factors that drive the adoption of resource efficiency practices in constrained economic times. We uncover the ‘paradox’ of lower investments in resource efficiency practices in a downturn market and identify the characteristics of firms that seek the opportunity to invest more in such conditions. We argue that even though the attractiveness of resource efficiency practices should increase in downturn market conditions, such practices require complementary capabilities, strategies and organizational structure for their successful adoption. We test our framework using data from a French survey with responses from5, 877firms. Our results show that only 6% of the firms in our sample invest in resource efficiency practices in downturn markets, and that those firms are more likely to be vertically integrated, and to have a main focus on cost leadership strategies, have adopted environmental standards and conduct their research internally. We provide...

Top Management Involvement in the Adoption of Energy Efficiency Projects

Tue, 18 Oct 2011 00:00:00 +0000

This paper investigates the role of top management in the adoption of energy-efficiency initiatives. We study data from 175 energy efficiency assessments done by San Diego State University (SDSU) during 2000-2008 as part of the Department of Energy’s Industrial Assessment Center Program. We find that top management involvement leads to firms adopting 30% more of the savings identified in an assessment. We also find that when top management is involved, the average payback of adopted proposals is 57.7% longer. When top managers do reject a recommendation, they are more likely to cite operational barriers, as opposed to economic or organizational ones, than other employees are. Altogether, this suggests that top managers perceive less resource constraints than other managers do and adopt a longer perspective on energy efficiency investments. Overall, our findings shed new light on how top management involvement influences the adoption of process innovations.

Lifecycle emission impacts of subsidies for energy efficiency: Evidence from Cash‐for‐Clunkers

Tue, 22 Mar 2011 00:00:00 +0000

One popular policy option to address environmental and economic concerns arising from current patterns of energy use is to subsidize increase in energy efficiency or renewable energy. In this paper we evaluate the lifecycle environmental bene�ts of the Car Allowance Rebate System (CARS) (or commonly `Cash-for-clunkers') which provided a subsidy for voluntary early retirement and replacement of low fuel economy automobiles with new, higher fuel economy vehicles. We �nd that the estimates of bene�ts hinge crucially on the assumption about what type of vehicle would have been purchased in the counterfactual scenario. Estimates are signi�cantly less sensitive to assumptions about the remaining useful life of vehicles traded-in and the rebound e�ect. Our prediction is that CARS program lead to a reduction of 9.1 to 17.8 million metric tonnes in greenhouse gas (GHG) emissions and 850 to 1600 million gallon reduction in gasoline use over a 13 year period. The average subsidy per tonne...

IS THE TAIL WAGGING THE DOG? AN EMPIRICAL ANALYSIS OF CORPORATE CARBON FOOTPRINTS AND FINANCIAL PERFORMANCE

Tue, 1 Feb 2011 00:00:00 +0000

There is a long-standing debate in the business strategy literature over whether or not firms profit from improving their environmental performance. However, the existing literature has focused mostly on regulated emissions data and few studies have included climate change in this debate or taken a life cycle analysis approach to defining environmental performance. This study investigates the impact of greenhouse gas emissions (GHG) on corporate financial performance, and develops complementary hypotheses based on accounting and market based corporate performance measures to represent a short term and long-term perspective on financial performance. Our study also includes both direct and supply chain GHG emissions in calculating a firm’s carbon footprint. In doing so, this paper addresses important questions concerning the profitability of environmental initiatives within the context of supply chain management. Our empirical analysis is based on a novel longitudinal database...

Agricultural expansion induced by biofuels: Comparing predictions of market‐equilibrium models to historical trends

Tue, 1 Feb 2011 00:00:00 +0000

Predicting global land use change (LUC) due to biofuel expansion and predicting greenhouse gas emissions attributable to LUC are both complex. This paper has the simpler objective of describing what the weight of historical experience in maize production during the past �ve decades in the US suggests about how much gross agricultural acreage may need to expand to accommodate higher crop demand and how this compares with predictions in the literature on LUC due to biofuels. We disaggregate historical change in crop production in the US into intensive and extensive margin e�ects and use the latter to predict a range for LUC due to US maize ethanol mandates. Analysis of historical data suggests that while for brief periods (2 or 3 years) acreage expansion could occur at the high rates predicted by several studies, in the long-run net expansion is likely to be smaller than such predictions.

Measuring Eco-inefficiency: A New Frontier Approach

Wed, 19 Jan 2011 00:00:00 +0000

Increasing social concerns over the environmental externalities associated with business activities are pushing firms to identify activities that create economic value with less environmental impact and to become more eco-efficient. Over the past two decades, researchers have increasingly used frontier efficiency models to evaluate productive efficiency in the presence of undesirable outputs, such as greenhouse gas emissions. In this paper, we identify critical flaws of existing frontier models and show that under these models eco-inefficient firms can be identified as eco-efficient. We develop a new eco-inefficiency frontier model that rectifies these problems. Our model allows us to calculate, for each firm, an eco-inefficiency score and improvements in outputs necessary to attain eco-efficiency. We demonstrate, through a Monte-Carlo experiment that our eco-inefficiency model provides a more reliable measurement of corporate eco-inefficiency than the existing frontier models....

On environmental lifecycle assessment for policy selection

Mon, 29 Nov 2010 00:00:00 +0000

Lifecycle Analysis (LCA) has become an important tool for guiding regional or national policy actions to address global environmental problems such as climate change. LCA-based indicators of greenhouse gas (GHG) intensity of di�erent fuels are being used to design long-term policies supporting renewable and alternative energy technologies. However, some of these technologies risk proving counter-productive to policy goals. An example is the debate about the environmental bene�ts of biofuels. Using biofuels as an illustrative example, we identify the structural reasons for the di�erences between two strands of literature on environmental bene�ts of alternative energy, namely, lifecycle analysis and economic market-equilibrium analysis. We explain why a policy planner cannot assume the potential environmental gains as revealed by a comparison between two LCAs as given while selecting policies to capture those gains. In other words lifecycle indicators are endogenous variables...

Regulation of GHG emissions from transportation fuels: Emission quota versus emission intensity standard

Mon, 29 Nov 2010 00:00:00 +0000

Climate change mitigation requires reduction in emissions of greenhouse gases rather than mere reduction in emission intensity of the economy. Regulations such as the Kyoto Protocol, Emission Trading Scheme, and the Regional Greenhouse Gas Initiative establish an emissions target as opposed to an emission intensity target. The policies implemented till date have also largely targeted emission reduction from power plants and the industries. Recent regulations aimed at controlling greenhouse gas emissions from transportation mandate intensity target for fuels. In this paper we compare abatement cost and output under two types of regulations of transportation fuels, namely, emission intensity standard and emission quota. We do this in the context of a price-taking region, and we focus on the shortrun. We �nd that under an intensity standard pollution abatement cost is higher than or equal at best to that under an emission quota, while aggregate output can be higher or lower than...

Multi-objective fuel policies: Renewable fuel standards versus Fuel greenhouse gas intensity standards

Mon, 29 Nov 2010 00:00:00 +0000

Governments throughout the world have enacted policies to support the introduction of alter- natives to crude oil. These policies are viewed as means to achieve multiple objectives such as energy independence and security, reduce greenhouse gas (GHG) emissions, protect fuel con- sumers and support infant industries. We evaluate the trade-o�s presented by di�erent policy instruments such as renewable fuel (biofuel) standards (RFS), fuel GHG intensity standards (FGIS) and fuel GHG tax in achieving these objectives. Using a two-region partial-equilibrium model, we �nd that the relative performance of the two policies, RFS and FGIS, relative to each other and relative to a fuel tax, depends on whether the policy is global or regional in scope. Whereas the FGIS has better environmental performance than RFS when applied globally, the two policies lead to similar environmental outcomes when the policy is regional. RFS leads to bigger marker share for non-crude oil fuels than both...