Determinants of participation versus consumption in the Nordic Swan eco-labeled market

This paper analyzes the determinants of demand for Nordic Swan eco-labeled paper products and whether the factors determining the discrete decision to buy a Swan-labeled product are different from those that determine the quantity purchased. Using observed consumer purchase data from Denmark, we find that prices and socio-demographic characteristics have a strong impact on the decision to purchase a Swan-labeled good. The quantity consumed of Swan-labeled goods, on the other hand, is strongly affected by the availability of Swan goods, discounts, and household size.

► We consider consumer demand for Nordic Swan eco-labeled paper products in Denmark. ► Consumer demand is found to consist of a two part decision process. ► The decision involves a market participation and a consumption quantity decision. ► Household socio-demographic factors are important in the participation decision. ► Monetary factors are more important influences in the consumption decision.