Social and Behavioral Sciences Commons^™

Predicting Consumer Demand Responses To Carbon Labels, Sharon Shewmake, Abigail Okrent, Lanka Thabrew, Michael Vandenbergh

Sharon Shewmake

Providing carbon footprint labels for all food products is a daunting and potentially infeasible project. Knowing how consumers substitute away from high carbon goods and what they choose as substitutes is essential for understanding which goods are likely to result in meaningful reductions in carbon emissions. This paper proposes a model to systematically estimate how consumers will respond to information from a carbon footprint label. Our model uses consumers’ value of their individual carbon footprint with own- and cross-price elasticities of demand data on carbon emissions from life cycle analysis to simulate shifts in consumer demand for 42 food products …