SESMAD

Ecolabels

Variable relationship:

Ecolabels (Policy Instrument) are policies and programs that are designed to signal information to stakeholders about a product’s attributes, and reduce stakeholder uncertainty about the validity of green product claims (Daugbjerg et al. 2014). Ecolabels encourage firms to adopt best resource use practices (Commons Condition Trend) by making their products more marketable and/or increasing their market value (Markets).

There are different types of ecolabels. A key distinction exists between voluntary and mandatory labels. Within the voluntary labels group, the most renowned for their effectiveness are the so called "third-party" enforced labels (External Monitoring; External Sanctioning). Indeed, government involvement in ecolabels generally improves uptake (Horne 2009).

Voluntary ecolabels face typical collective action and transaction cost issues (Transaction Costs) associated with the possibility that some firms free-ride on the contributions of other firms to the reputation of the label, and on the burden born by consumers to acquire and process relevant information and compare different labels and products (Horne 2009; Truffer 2001).

Project

SESMAD

Sector(s)

Scientific Field

Component Type(s)

Governance System

Status

Public

Variables

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Variable	Role	Role Explanation	Value
Policy instrument	Proximate independent variable	Eco-labels are designed to signal information to stakeholders about a product’s resource conservation attributes so stakeholders can reward those practices via markets.	Information provision
Compliance	Moderating independent variable	Monitoring and sanctioning can enable the compliance needed to ensure that the eco-label scheme is effective.	Yes
External monitoring	Moderating independent variable	Third party monitoring guarantees that firms do follow resource conservation practices thus making the labels credible	Yes
External sanctions	Moderating independent variable	Third party monitoring guarantees that firms do follow resource conservation practices thus making the labels credible	Yes
Transaction costs	Moderating independent variable	The lower costs of information gathering and monitoring for consumers (i.e., understanding what the label represents and comparing it to others), as well as for producers (i.e., enforcement), the higher the net benefits of the ecolabels.	Low
Commons condition trend	Final outcome	Ecolabels pay off the resource conservation efforts by resource users/production firms which encourage these to invest in those efforts	Remained the same or improved

Showing 1 to 6 of 6 entries

Related Theories

Theory	Relationship	Characterizing Variables
Enforcement	contains

Related Studies