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Information Provision in Environmental Policy Design

V. Danilina1* and A. Grigoriev2

  1. Aix-Marseille Univ., CNRS, EHESS, Centrale Marseille, AMSE 5-9 Boulevard Bourdet, CS 50498 13205 Marseille Cedex 1, France
  2. Maastricht University School of Business and Economics, QE/SBE, P.O. Box 616, 6200 MD Maastricht, The Netherlands

*Corresponding author. Tel.: +33 (0)781551921; fax: +33 (0)413552560. E-mail address: (V. Danilina).


Information provision is a relatively recent but steadily growing environmental policy tool. Its emergency and topicality are due to the current escalation of ecological threats. Meanwhile, its high complexity and flexibility require a comprehensive approach to its design, which has to be tailored for specific characteristics of production process, market structure, and regulatory goals. This work proposes such an approach and builds a framework based on a three-level mathematical program extending well-known two-level Stackelberg game by introducing one more economic agent and one extra level of this sequential game. This study provides simple and very intuitive algorithms to compute optimal multi-tier information provision policies, both mandatory and voluntary. The paper urges for the wide implementation of such efficient environmental policy design tools.

Keywords: environmental policy, information provision, eco-certification, eco-labelling, multi-level mathematical programming, stackelberg game, exact algorithms

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