How Government Regulations and Consumer Behavior Influence Manufacturers’ Product Green Degree Decision‐Making: An Agent‐Based Model

Abstract

In recent years, green product issues have received increasing attention. Both government regulations and consumer behaviors have a strong influence on the product green degree decisions of manufacturers’ products. In order to find how government regulations and individual’s green product purchase behavior affect manufacturers’ green degree decisions and the market evolution characteristics, this paper proposes a multiagent model that considers the interaction among government, consumers, and manufacturers. The simulation results show that, firstly, the product green degree decision‐making of manufacturers needs the guidance and regulation of the government. Secondly, product price subsidies are the most effective way to affect the manufacturers’ product green degree decisions. In contrast to giving green cost subsidies to manufacturers, the government employs various publicity means to improve the environmental awareness of consumers is also an effective way to enhance the green degree of manufacturers’ products. Thirdly, there is a “Crowding Out Effect” on the other qualities of manufacturers’ products when manufacturers focus on the green degree of their products.