Role of Internal and External Values on Green Purchase

Role of Internal and External Values on Green Purchase

Sushant Kumar (Indian Institute of Management Shillong, India) and Naman Sreen (Indian Institute of Management Shillong, India)
DOI: 10.4018/978-1-5225-9558-8.ch007

Abstract

In recent years, consumers' interest has grown for environmental issues and responsible consumption. With the widespread familiarity with sustainable development goals, consumers are making environmentally friendly decisions in their daily consumption practices. The study focuses on the role of internal and external values in building favorable attitude towards green purchase. Two separate studies were conducted on Indian population. The first study examines the impact of internal values on green purchase intention whereas the second study examines the impact of external values on green purchase intention. Study 1 investigates the role of culture on forming attitude that leads towards green purchase intention with mediating variables: attitude, subjective norms, and perceived behavioral control. Study 2 investigates the impact of formal norms on green purchase intention through internal cognition variables which are knowledge, perceived expected outcomes, self-efficacy, and attitude. Findings indicate that internal and external values impact the green behavior.
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Introduction

Economic growth is considered a boost for the economy and a boost for per capita income. However, economic growth also leads to resource exploitation in the natural environment. With the increase in population and availability of more disposable income, resources are getting exploited at an ever increasing rate. The severity of damage to the environment caused by economic growth is frequently cited in the news media and is considered responsible for environmental disasters (Kumar et al., 2019). The impact of economic growth on the environment presents a paradox.

On one hand, pollution haven hypothesis entails that economic activities such as trade liberalization, open market, multi - national companies and foreign direct investment are considered advantageous for the economy but damages the environment (Kumar et al., 2019). Multinational companies establish their production units in developing countries where they have easy access to cheap labor, low cost land, with less environmental regulations. In the process of establishing manufacturing units, companies inspire the movement of lower technologies and polluting industries with unsound environmental practices to emerging countries. This initiates a race to the bottom in environmental performance for emerging countries (Xing & Kolstad, 2002). Emerging countries usually have lower per capita income and wants to develop their industries to boost the standard of living. Polluting industries in developed countries, found it costly to comply for environmental regulations that developed countries have. They move their polluting businesses to emerging countries which usually have not so strict requirement of compliance on environmental norms. Developing countries such as India have environmental norms and regulations. But the non - compliance of these rules are frequently highlighted in the media. The evidences of degradation in environmental performance can be seen in the decline in the environmental performance index of India from year 2014 to year 2018. The 2014 environmental performance index released by Yale and Columbia Universities along with the World Economic Forum ranked India at the 155th position out of 178 countries (EPI, 2014). After the year 2014, India became more open and liberalized its economy. The inflow of foreign direct investment was welcomed in all sectors and industries. The growth in foreign direct investment was seen within 3 years when the foreign direct investment jumps from $36 Billion in year 2014 to $60 in year 2017 (Financial Express, 2017). The economy is expected to grow at a greater pace than before. However, during this period, India has seen degradation in environmental performance index. The 2018 environmental performance index ranked India at 177th position out of 180 countries (EPI, 2018). Despite government’s measure and regulations, pollution from solid fuels, crop residue burning, and emission from factories and vehicles continues to degrade the environmental standard. Jun et al. (2018) examined the effect of foreign direct investment on pollution in China. They examined the foreign direct investment data from 1982 to 2016 and carbon dioxide emission as pollution variable. They found that foreign direct investment causes the carbon dioxide emission in both short - run and long run.

Key Terms in this Chapter

Long-Term Orientation: Long-term orientation refers to the belief in society members that the future is more prosperous than present. To the future more prosperous, members are ready to take corrective and preventive action in the present even if it may lead to parsimonies in consumption in present.

Attitude: Attitude refers to the product of perceived expected outcome and evaluation of the outcome. In simple terms, attitude refers to the dispositions that one learns to respond to any event, stimuli or object in a persistent fashion may be favorably or unfavorably.

Formal Norms: Formal norms refers to the rules and regulations that social institutions or governments put in place for people to adhere. These regulations are applicable to all citizens of that nation and citizens must follow these regulations.

Collectivism: Collectivism refers to the orientation of society towards a collaborative stance in which the priorities of society is kept higher than the priorities of an individual. Individualism is opposite end of the collectivism. Individualism emphasizes on self-reliance and being dependent.

Perceived behavioral control: Perceived behavioral control refers to the comfort level of an individual to perform any particular behavior. The comfort level is determined from the one’s confidence in his or her abilities to perform certain task at hand.

Subjective norm: Subjective norms refer the rules and regulation designed by society on which one should function. For any specific behavior, society has set or designed norms on how to perform that behavior. Subjective norms refer to that kind of norms which an individual follows due to social pressure.

Green Purchase Intention: Green purchase intention refers to the behavioral intention or willingness of a person to purchase green marketing offerings. Green purchase intention does not guarantee a purchase, but it signifies the favorable or unfavorable evaluation one has about a specific product.

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