'Shop Until You Drop' : The Unexpected Effects Of Anti-Consumerism and Environmentalism

In an economy where consumers have heterogeneous preferences over the hedonic and environmental attributes of goods on sale, we explore the effects of anti-consumerism and environmentalism. We show that when the environmental attributes of products come at the expense of the hedonic attributes, a higher supply of anti-consumerism and environmentalism yields the expected positive effect on the environment. In contrast, when hedonic and environmental attributes are jointly met by a good, higher levels of anti-consumerism and environmentalism negatively affect the society's environmental footprint. Moreover, the welfare impact of anti-consumerism and environmentalism is far from being obvious, giving rise to unexpected redistributive effects between firms and consumers