Monteiro, Jose-Antonio (2010): Eco-label Adoption in an Interdependent World.
Download (555kB) | Preview
The growing popularity of national efforts to promote eco-labeling raises important questions. In particular, developing countries fear that the eco-label can deliberately impose the environmental concern of (high income) importing countries on their production methods. Yet, empirical studies of the adoption of eco-labelling schemes at the cross-country level are scarce due to the lack of data availability. In this paper, the decision to introduce an eco-label is analyzed through a heteroskedastic Bayesian spatial probit, which allows the government’s decision to introduce an eco-label to be influenced by the behaviour of the neighbouring countries. The estimation is performed by extending the joint updating approach proposed by Holmes & Held (2006) to a spatial framework. Empirical evidence highlights the importance of a high stage of development, innovation experience and potential scale effects in the implementation of an eco-label scheme. In addition, results confirm the existence of a strategic interdependence in the eco-label decision.
|Item Type:||MPRA Paper|
|Original Title:||Eco-label Adoption in an Interdependent World|
|Keywords:||Bayesian Spatial Probit, International Trade, Environmental Policy, Eco-labelling|
|Subjects:||F - International Economics > F1 - Trade > F18 - Trade and Environment
C - Mathematical and Quantitative Methods > C2 - Single Equation Models ; Single Variables > C25 - Discrete Regression and Qualitative Choice Models ; Discrete Regressors ; Proportions ; Probabilities
C - Mathematical and Quantitative Methods > C1 - Econometric and Statistical Methods and Methodology: General > C11 - Bayesian Analysis: General
|Depositing User:||Jose-Antonio Monteiro|
|Date Deposited:||27. Jan 2010 16:20|
|Last Modified:||12. Feb 2013 17:37|
Albert, J. H., & S. Chib, 1993. "Bayesian Analysis of Binary and Polychotomous Response Data", Journal of the American Statistical Association, 88, pp. 669-679.
Basu, A. K., Chau, N. H. & U. Grote, 2004. "On Export Rivalry and the Greening of Agriculture .the Role of Eco-labels," Agricultural Economics, 31(2-3), pp. 135-147.
Beaulieu, E. & J. Gaisford, 2002. "Labour and Environmental Standards: The .Lemons Problem.in International Trade Policy," The World Economy, 25(1), pp. 59-78.
Beron, K. J., Murdoch, J. C. & W. P. M. Vijverberg, 2003. "Why Cooperate? Public Goods, Economic Power, and the Montreal Protocol," The Review of Economics and Statistics, 85(2), pp. 286-297.
Bonsi, R. Hammett, A.L., & B. Smith, 2008. "Eco-labels and International Trade: Problems and Solutions", Journal of World Trade, 42(3), pp. 407-432.
Bruce, C., & A. Laroiya, 2007. "The Production of Eco-Labels," Environmental and Resource Economics, 36(3), pp. 275-293.
Cao, X. & A. Prakash, 2009, "Trade Competition and Domestic Pollution: A Panel Study, 1980-2003," International Organization, forthcoming.
Cole, M. A., Elliott, R. J. R., & K. Shimamoto, 2005. "Industrial Characteristics, Environmental Regulations and Air Pollution: an Analysis of the UK Manufacturing Sector," Journal of Environmental Economics and Management, 50(1), pp. 121-143.
Fleming, M., 2002. "Techniques for Estimating Spatially Dependent Discrete Choice Models," in Anselin, L., Florax, R. J., and Rey, S. J., editors, Advances in Spatial Econometrics. Springer-Verlag, Heidelberg.
Franzese, R. J., & J. C. Hays, 2008. "The Spatial Probit Model of Interdependent Binary Outcomes: Estimation, Interpretation and Presentation".
Galarraga, I. G., 2002. "The Use of Eco-labels: a Review of the Literature." European Environment, 12(6), pp. 316-331.
Geweke, J, 1993. "Bayesian Treatment of the Independent Student-t Linear Model," Journal of Applied Econometrics, 8, pp. 19-40.
Greaker, M., 2006. "Eco-labels, Trade and Protectionism," Environmental and Resource Economics,33, pp. 1-37.
Grolleau, G. & S. El Harbi, 2008. "Why some Countries Adopt Ecolabeling Schemes in their Regulatory Arsenal and Others Do Not?," Economics Bulletin, Economics Bulletin, 17(3), pp. 1-11.
Holloway, G., Bhavani, S., & R. Sanzidur, 2002. "Bayesian spatial probit estimation: a primer and an application to HYV rice adoption," Agricultural Economics, 27(3), pp383-402.
Holmes C. C. & L. Held, 2006. "Bayesian Auxiliary Variable Models for Binary and Multinomial Regression.", Bayesian Analysis, 1(1), pp. 145-168.
Kern, K., Jörgens, H., & M. Jänicke, 2001. "The Dissusion of Environmental Policy Innovations. A Contribution to the Globalisation of Environmental Policy," Discussion Paper FS II 01-302. Social Science Research Centre: Berlin.
LeSage, J.P., 2000. "Bayesian Estimation of Limited Dependent Variable Spatial Autoregressive Models," Geographical Analysis, 32, pp. 19-35.
LeSage, J.P. & O. Parent, 2007. "Bayesian Model Averaging for Spatial Econometric Models.", Geographical Analysis, 39(3), pp. 241-267.
LeSage, J. & R. K. Pace, 2009, "Introduction to Spatial Econometrics," CRC Press Inc.
Magnani, E., 2000. "The Environmental Kuznets Curve, Environmental Protection Policy and Income Distribution," Ecological Economics, 32(3), pp. 431-443.
McMillen, D.P., 1992. "Probit with Spatial Autocorrelation," Journal of Regional Science, 3, pp. 335-348.
Mattoo, A. and H.V. Singh, 1994. "Eco-labelling: Policy Considerations,", Kyklos 47(1), pp. 53-65.
Melser, D., & P. E. Robertson, 2005. "Eco-labelling and the Trade-Environment Debate," The World Economy, 28(1), pp. 49-62.
Nadai, A., 1999. "Conditions for the Development of a Product Ecolabel," European Environment, 9, pp. 202-211.
OCDE, 2004. "Effects of Eco-labelling Schemes: Compilation of Recent Studies," Joint Working Party on Trade and Environment.
Piotrowski, R. & S. Kratz, 1999, .Eco-labelling in the Globalised Economy., International Politics and Society, 4, pp. 430-443.
Peattie, K., 2001. "Golden Goose or Wild Goose? The Hunt for the Green Consumer," Business Strategy and the Environment, 10, pp. 187-199.
Pedersen, E.R. & P. Neergaard, 2006, "Caveat Emptor . Let the Buyer Beware! Environmental Labelling and the Limitations of .Green.Consumerism.", Business Strategy and the Environment, 15(1), pp. 15-29.
Pinkse, J. & M. Slade, 1998. "Contracting in Space: An Application of Spatial Statistics to Discrete Choice Models," Journal of Econometrics, 85, pp. 125-154.
Porter, M. E & C. van der Linde, 1995. "Toward a New Conception of the Environment-Competitiveness Relationship," Journal of Economic Perspectives, 9(4), pp. 97-118.
Raftery, A.E. & S.M. Lewis, 1992. "One Long Run with Diagnostics: Implementation Strategies for Markov Chain Monte Carlo," Statistical Science, 7, pp. 493-497.
Raftery, A.E. & S.M. Lewis, 1995. "The Number of Iterations, Convergence Diagnostics and Generic Metropolis Algorithms," in Practical Markov Chain Monte Carlo, W.R. Gilks, D.J. Spiegelhalter & S. Richardson, eds.
Rodriguez-Yam, G., Davis, R. A., & L. Scharf, 2004. "Efficient Gibbs Sampling of Truncated Multivariate Normal with Application to Constrained Linear Regression."
Sammer, K., & R. Wüstenhagen, 2006. "The In.uence of Eco-Labelling on Consumer Behaviour - Results of a Discrete Choice Analysis for Washing Machines," Business Strategy and the Environment, 15, pp. 185-199.
Sedjo, R. A., & S. K. Swallow, 2002. "Voluntary Eco-Labeling and the Price Premium," Land Economics, 78(2), pp. 272-284.
Smith, T. E. & J. P. LeSage, 2004. "A Bayesian Probit Model with Spatial Dependencies," in Advances in Econometrics: Volume 18: Spatial and Spatiotemporal Econometrics, J. P. LeSage & R. K. Pace (eds.), Oxford, pp. 127-160.
Swallow, S.K. and R.A. Sedjo, 2000. "Eco-labeling Consequences in General Equilibrium: A Graphical Assessment," Land Economics 76(2), pp. 28-36.
Teisl, M. F., Roe, B., & A. S. Levy, 1999. "Ecocerti.cation: Why It May Not Be a Field of Dreams," American Journal of Agricultural Economics, 81(5), pp. 1066-1071.
Thomas, T.S., 2007. "A Primer for Bayesian Spatial Probits with an Application to Deforestation in Madagascar."
UNEP, 2005. "The Trade and Environmental E¤ects of Ecolabels: Assessment and Response."