Behavioral Environmental Economics: Promises and Challenges

Rachel Croson, Nicolas Treich

Research output: Contribution to journalArticle

67 Scopus citations

Abstract

Environmental issues provide a rich ground for identifying the existence and consequences of human limitations. In this paper, we present a growing literature lying at the interface between behavioral and environmental economics. This literature identifies alternative solutions to traditional economic instruments in environmental domains that often work imperfectly. But it also faces a set of challenges, including the difficulty of computing welfare effects, and the identification of a robust environmental policy based on context-dependent (socio-) psychological effects. We illustrate our critical discussion with two behavioral schemes that have been widely implemented: "green nudges" and "corporate environmental responsibility."

Original languageEnglish (US)
Pages (from-to)335-351
Number of pages17
JournalEnvironmental and Resource Economics
Volume58
Issue number3
DOIs
StatePublished - Jun 2014
Externally publishedYes

Keywords

  • Behavioral economics
  • Corporate social responsibility
  • Environmental policy
  • Environmental psychology
  • Nudge

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