Abstract
An eco-labeling scheme is a method of environmental performance certification that is beneficial for reducing negative environmental impacts and promoting green consumption. Many types of research studies have shown its effectiveness. However, to the best of our knowledge, fewer studies have considered how to supervise and regulate the enterprises after getting certificated. An enterprise may have obtained certification that its product meets the corresponding environmental standards, but without effective supervisions and regulations, it may not continue to implement the standards after being certified. Such behaviors are not only unfavorable to environmental protection, they also harm the eco-labeling scheme. With the consideration that different eco-labeling schemes and standards would result in different interaction relationships among stakeholders, we focus on Chinese Environmental Labeling (CEL), which is a government-sponsored scheme. By utilizing the approach of evolutionary game theory, we built a model including the government agency and enterprise and their strategic interactions. Numerical analyses are applied to verify the modeling analyses and demonstrate the influences of game parameters. Our results indicate that supervisions from the government side are necessary in order for the enterprises to implement the standards, but high supervision costs and low efficiency are the main factors that prevent the government agency from getting more involved. Reducing the executing costs of the enterprises would prompt them to participate more. Additionally, if the government agencies and customers could have a bigger, more positive influence on the enterprises, then the enterprises would likely choose to implement the standards. Our results provide references for the better development of an eco-labeling scheme as well as government environmental policy-making.
Highlights
Eco-labeling schemes are always launched by governments and other organizations to differentiate between enterprises that apply green processes and those that do not
With the public becoming more concerned about the influences of their daily activities on the environment, eco-labeling has become an effective tool for individual customers verifying the environmental friendliness claimed by enterprises [1,2]
In panel (n), we can see that to the enterprise, when the supervision effectiveness of the government agency decreases (R increases), the enterprise would tend to choose the strategy of non-execution, in which case the ESS point would switch from D (1, 1) to C (1, 0)
Summary
Eco-labeling schemes are always launched by governments and other organizations to differentiate between enterprises that apply green processes and those that do not. Few studies have considered how to regulate and supervise the eco-labeled enterprises after certification. Would customer confidence in the eco-label decrease with the dishonest behaviors of involved enterprises, but incentives for other prospective enterprises to participate would go down due to the less valuable scheme From this point of view, measures should be adopted by governments to deal with it. Eco-labeled enterprises and policymakers are bounded by rationality and change their strategies dynamically by observing and comparing payoffs with others. CEL-labeled products have the priority for Implementation costs for supervision government procurement; so, we use P2 to denote the benefits from the government side. A constant that reflected the supervision effectiveness of the government agency q(C1 )
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