A Unifying Algebra of Green Consumption Technologies

This study outlines a unifying model of “green consumption technologies,” which mediate the household production of utility-conferring characteristics and externalities from available market goods. Green consumption technologies are wide-ranging and have been studied in disparate ways in separate literatures on passenger vehicles, home appliances, impure public goods, carbon offsets, and altruism. This study distills these phenomena into a common set of modeling objects, revealing shared features that underpin multiple distinct environmental problems. This study furthermore derives and presents a clean welfare framework for normative evaluation—something that has been underdeveloped in existing work. In particular, it shows how welfare impacts from technological change will depend heavily on trade-offs between consumption and potentially countervailing externalities as well as how those trade-offs are modulated by the underlying consumption technology. In doing so, it provides several important insights for empirical research and generates more lucid policy and management prescriptions across these various literatures.