Feature Papers represent the most advanced research with significant potential for high impact in the field. Feature
Papers are submitted upon individual invitation or recommendation by the scientific editors and undergo peer review
prior to publication.

The Feature Paper can be either an original research article, a substantial novel research study that often involves
several techniques or approaches, or a comprehensive review paper with concise and precise updates on the latest
progress in the field that systematically reviews the most exciting advances in scientific literature. This type of
paper provides an outlook on future directions of research or possible applications.

The observation that firms are greenwashing in their advertisements to consumers has attracted regulatory false claim concerns; thus, we built a three-stage game theoretical model to explore how a firm’s efficiency in greenness information acquisition and a false claims ban (FCB) regulatory policy induce greenwashing (non-greenwashing) in the green advertising market. We solved the model with the concept of the perfect Bayesian equilibrium. Based on the PBEs, we obtained the following results. (1) A FCB regulatory policy is necessary to rule out any intentional greenwashing PBE. (2) In the presence of a strict FCB regulatory policy (with a large enough FCB penalty), if the precision of the firm’s observed signals is lower (or higher) than a threshold, uninformative non-greenwashing (both unintentional and uninformative non-greenwashing) PBEs arise, and the threshold increases in the FCB penalty. (3) A strict FCB regulatory policy and a high level of efficiency (regarding the firm’s greenness information acquisition) can (together) rule out greenwashing; the threshold of the efficiency of the firm’s greenness information acquisition is independent of the regulatory policy. Managerial implications are also discussed.
greenwashing; false claims ban; advertising; perfect Bayesian equilibrium
greenwashing; false claims ban; advertising; perfect Bayesian equilibrium

This content was originally published here.


About JJ

Leave a Reply