Green Disposable Packaging and Communication: The Implications of Bring-Your-Own-Container
Posted: 23 Jul 2021 Last revised: 18 Jan 2024
Date Written: December 14, 2021
Abstract
Problem Definition: A growing number of firms are encouraging consumers to participate in `Bring-Your-Own-Container' (BYOC) behavior, in which consumers bring their own reusable packaging to purchase and consume products, thus reducing single-use packaging waste. In this paper, we study the impacts of BYOC on a firm's disposable packaging and communication strategies.
Methodology/Results: We build a stylized model to study a firm's disposable packaging choice and communication decisions and their implications on the environment. Our main results follow. First, with consumers bringing their own containers, the firm will have less incentive to make fraudulent green claims about its disposable product packaging (i.e., greenwashing). Second, a small certification fee is not a sufficient condition for a firm to have its green packaging certified, in the presence of consumer BYOC behavior. In particular, it may not be profitable for a firm to adopt a credible third-party certification to disclose its disposable packaging's environmental quality, even if the certification is costless. Finally, if a firm adopts a third-party certification for its green disposable packaging, it may cause a negative impact on the environment. Thus, from an environmental perspective, it is not always wise for the government to mandate that firms have their green claims verified by a third party, even though such regulations can help eliminate the greenwashing phenomenon in the market.
Managerial Implications: We offer operational insights on how firms should make decisions regarding green disposable packaging and communication when they allow BYOC. We also generate insights on how governments should regulate firms' green claims.
Keywords: Green disposable packaging, greenwashing, green claim, consumer pro-environmental behavior, game theory
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