Assessing Voluntary Commitments: Monitoring is Not Enough!

This paper deals with a special type of voluntary approach to protect the environment, for example, that we would like to term voluntary commitment. Its major characteristic is that it represents a unilateral declaration without a decisively active role of regulators. In other words, voluntary commitments are, by definition, not the result of intensive mutual negotiations between participants and regulators. By combining theoretical considerations on the economic rationale for the popularity of voluntary commitments with an investigation of principal conceptual and statistical problems regarding their empirical assessment, it seems unlikely that voluntary commitments generally trigger significant deviations from business-as-usual. This casts doubt on the effectiveness and, hence, the efficiency of this specific type of voluntary approach. Effectiveness, guaranteed through more demanding goals, requires intensive mutual negotiations – monitoring is not enough.