Promoting Green Or Restricting Gray? An Analysis Of Green Portfolio Standards ?

This study theoretically examines green portfolio standards with monetary penalties in an oligopoly market. We find that green portfolio standards attain first-best optimality if the purpose of the government is to restrict non-green products (i.e., unless the negative externality of gray products is too small), whereas they are inefficient policy tools if the purpose is to promote green products. (C) 2020 Elsevier B.V. All rights reserved.