Pricing for Green Product

Abstract

AbstractThe rise in consumers’ green preferences promotes manufacturers to produce and provide green products and services, which is conducive to achieving sustainable enterprise development and meeting consumers’ growing green consumption demand. In the competition between green and common products, price is still one of the key factors affecting consumers’ purchase decisions. There is information asymmetry in the green product market, which will lead to “bad money drives out good”. Consumers have incomplete knowledge and information about green products, and cannot accurately know about the green state of products. Consumers can only make indirect judgments through product prices. If the price is too high, some consumers give up their purchases. Whereas if it is too low, it will not only fail to cover the production cost but will also make consumers question the quality of green products. Based on the above analysis, this chapter focuses on the impact of green product pricing in enterprises’ green growth model of and analyzes the differences in pricing between green products and common products. In addition, it discusses the factors that enterprises need to consider when making green product pricing decisions. Then, based on the theoretical analysis, pricing models of green products between manufacturers and consumers, retailers, and the government are established, and the influence of information asymmetry on the pricing of green products under different conditions is analyzed. Finally, the conditions for distinguishing qualified and unqualified green products in the market are discussed to promote standardized operation of the green product market and improve the confidence of consumers in the green market.