Original scientific paper
https://doi.org/10.1080/1331677X.2020.1804424
Environmental certification in a differentiated duopoly
Haiyang Xia
Tijun Fan
Gaoxiang Lou
Abstract
The articleaims to explore the role of horizontal product differentiation in promoting/hindering firm’s participation in environmental certification. To this purpose, we consider a differentiated
duopoly model where firms compete in both prices and environmental qualities. The result shows that when the level of horizontal differentiation relative to the degree of vertical differentiation
is sufficiently high, only the symmetric equilibrium where both
firms choose to or both choose not to certify their products
exists. Asymmetric equilibrium (vertical dominance equilibrium)
occurs when the level of horizontal differentiation relative to the
degree of vertical differentiation is sufficiently low.
Keywords
environmental certification; horizontal and vertical differentiation; twodimensional competition
Hrčak ID:
301184
URI
Publication date:
31.12.2021.
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