In this study, we undertake some hypothetical experiments and predict the environmental effects of some changes in consumer behavior, using the Japanese Input-Output Table and the Family Income and Expenditure Survey for 2000. We estimate the demand function in a linear expenditure system (LES) and attempt to determine how changes in consumer behavior affect the environmental load induced by household consumption, using the 'willingness to pay' concept. Furthermore, we define an index to show the eco-efficiency of consumer behavior. Through such a study, we can determine what action is appropriate for a 'sustainable consumption' society. If some change of consumer behavior greatly improved utility while increasing the environmental load, then technological progress to reduce the environmental load must be stimulated. However, if other changes in consumer behavior increase the environmental load while not improving utility very much, then such changes should be strongly discouraged.
ASJC Scopus subject areas
- Economics and Econometrics