Environmental concerns, income inequality, and purchase of environmentally-friendly products: A longitudinal study of U.S. counties (2010-2017)

Abstract

Environmentally-friendly products are being introduced at a rapid pace, making it critical that we understand the conditions that affect the degree to which they are accepted in a market. We investigate how two community characteristics—environmental concerns and income inequality—shape the demand for environmentally-friendly products and how the community influence depends upon the product's degree of visibility. We test our hypotheses by examining conspicuous purchases of electric vehicle (EV) and inconspicuous energy-saving equipment installment for U.S. counties from 2010 to 2017. We find that (1) environmental concerns are positively related to inconspicuous environmentally-friendly purchases only and (2) income inequality negatively affects inconspicuous environmentally-friendly purchases, but has a more positive influence on conspicuous purchases. Moreover, we find a positive interactive effect of environmental concerns and income inequality on inconspicuous environmentally-friendly purchases. Our study provides a more nuanced understanding of how environmental concerns and income inequality influence the acceptance of environmentally-friendly products. These findings can inform the management of policies related to environmental protection and eco-innovations, calling for attention to these community characteristics as well as the important attribute of environmentally-friendly product—i.e., visibility.