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Environmental Consciousness, Reputation And Voluntary Environmental Investment

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  • CHIA‐YING LIU
  • CHI‐HSIN WU

Abstract

This note attempts to explore the driving force behind firms' voluntary environmental investment and to provide an alternative viewpoint to the traditional notion of environmental investment. We show that, if consumers are environmentally conscious, then firms' environmental investment will enhance their environmentally‐based reputation and effectively stimulate consumer demand for the product. Thus, some firms will voluntarily engage in environmental investment. In addition, it is also found that when consumers become more environmentally conscious, in the steady state a high level of environmental investment may be associated with higher output. This result potentially provides an explanation as to why environmental quality may increase with output.

Suggested Citation

  • Chia‐Ying Liu & Chi‐Hsin Wu, 2009. "Environmental Consciousness, Reputation And Voluntary Environmental Investment," Australian Economic Papers, Wiley Blackwell, vol. 48(2), pages 124-137, June.
    • Handle: RePEc:bla:ausecp:v:48:y:2009:i:2:p:124-137
    DOI: 10.1111/j.1467-8454.2009.00366.x
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    Cited by:

    1. Rui Pang & Minjun Shi & Dan Zheng, 2022. "Who comply better? The moderating role of firm heterogeneity on the performance of environmental regulation in China," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(5), pages 6302-6326, May.
    2. Yu-Shan Chen & Tai-Wei Chang & Chun-Yu Lin & Pi-Yu Lai & Kuan-Hung Wang, 2016. "The Influence of Proactive Green Innovation and Reactive Green Innovation on Green Product Development Performance: The Mediation Role of Green Creativity," Sustainability, MDPI, vol. 8(10), pages 1-12, September.
    3. Wenchang Fang & Tzong-Hann Wu & Tai-Wei Chang & Cheng-Ze Hung, 2021. "What Could Entrepreneurial Vision Do for Sustainable Development? Explore the Cross-Level Impact of Organizational Members’ Green Shared Vision on Green Creativity," Sustainability, MDPI, vol. 13(10), pages 1-15, May.
    4. Azadegan, Arash & Golara, Sina & Kach, Andrew & Mousavi, Nasim, 2018. "Corporate environmental investments: A cross-national study on managerial decision making," International Journal of Production Economics, Elsevier, vol. 199(C), pages 47-64.
    5. Andiç, Esen & Yurt, Öznur & Baltacıoğlu, Tunçdan, 2012. "Green supply chains: Efforts and potential applications for the Turkish market," Resources, Conservation & Recycling, Elsevier, vol. 58(C), pages 50-68.

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