Greener and cleaner? The signaling accuracy of U.S. voluntary environmental programs
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Voluntary environmental programs (VEPs) have become a popular alternative to traditional regulation. However, little is known about whether these programs are sending accurate signals about the environmental practices of their participants. As a means for understanding signaling accuracy, this research investigates VEP design characteristics. The findings suggest that there are four distinct types of programs with varying degrees of rigor. Because information for differentiating among program types is limited, less rigorous VEPs can signal that their administrative, environmental performance and conformance requirements are comparable to programs with more robust designs. Further, the lack of monitoring and sanctions in less rigorous programs create opportunities for participants to free-ride and receive benefits without satisfying VEP requirements. Unless some means of distinguishing among program types is implemented, these issues can threaten the long term viability of VEPs as a tool for environmental protection, and the credibility of market mechanisms more broadly.
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- Greener and cleaner? The signaling accuracy of U.S. voluntary environmental programs
Volume 38, Issue 2-3 , pp 71-90
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- 1. Department of Environmental Science & Policy, George Mason University, 4400 University Dr., MSN 5F2, Fairfax, VA, 22030-4400
- 2. Department of Urban Studies and Planning, Massachusetts Institute of Technology, 77 Massachusetts Avenue 9-320, Cambridge, MA, 02139