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Mastrangelo, Cristina Rose

Community Development and Applied Economics

M.S.

Worldwide awareness of environmental problems has increased over the past several decades. However, people's responsiveness is disproportionate to the severity of environmental issues. The regulatory strategies that have attempted to protect resources and minimize pollution have not been effective enough to mitigate problems. Much of the continued degradation is caused by the consumption of resources. For these reasons environmental action has increasingly taken place in the economic sector. Corporate environmental responsibility and environmentally conscious consumerism have driven firms to focus more on environmental performance. Certification and labeling programs are mechanisms within the market that provide information to consumers as well as hold producers accountable. Eco-labels can be an effective tool for reducing environmental impacts.
A pilot program, called the Green Coach Certification (GCC), began in the spring of 2009 and concluded in 2011. It introduced a certification and eco-label in the motorcoach industry. The GCC program was based on several criteria that allow a motorcoach company to attain certification and use the labels in their marketing materials. In order to gain a better understanding of how this label would be received in the market an Internet survey was developed and administered to tour operators that belong to motorcoach industry organizations. A tour operator is a consumer of transportation services. Because they are companies offering services to end consumers, tour operators are mid-supply chain organizations. Drawing from the Theory of Reasoned Action, which explains behavior through attitudes and subjective norms, this study attempts to determine 1) if demand exists for eco-labeled transportation services among tour operators 2) if current behaviors predict willingness to pay for eco-labeled transportation services and 3) attitudes toward environmental responsibility and financial success affect a tour operator's willingness to pay a premium for eco-labeled services.
The results from the survey reveal that there is a demand for eco-labeled transportation services as about half of respondents were willing topay some additional amount. There is also a correlation between companies that currently engage in environmentally responsible behaviors and their willingness to pay. A two-step regression analysis was applied to test if attitudes, behaviors and subjective norms predict a company's willingness to pay a premium. Companies that already or are interested in incorporating a green message in their marketing are least willing to pay for eco-labeled transportation services. Additionally, company size was tested in the model. Large companies are more willing to pay. This information can be useful in determining a target market for the eco-label. It also provides a greater understanding of the factors that affect tour operators' willingness to pay a premium for the eco-label.