Working Paper | HBS Working Paper Series | 2012

Public Procurement and the Private Supply of Green Buildings

by Timothy Simcoe and Michael W. Toffel
 

Abstract

We measure the impact of municipal policies requiring governments to construct green buildings on private-sector adoption of the U.S. Green Building Council's Leadership in Energy and Environmental Design (LEED) standard. Using matching methods, panel data, and instrumental variables, we find that government procurement rules produce spillover effects that stimulate both private-sector adoption of the LEED standard and supplier investments in green building expertise. Our findings suggest that government procurement policies can accelerate the diffusion of new environmental standards that require coordinated complementary investments by various types of private adopters.

Keywords: environmental protection; environment; environmental regulation; regulation; procurement; supply chain; sustainability; Buildings and Facilities; Law; Markets; Supply Chain; Risk and Uncertainty; Business and Government Relations; Real Estate Industry; Construction Industry; Public Administration Industry; California;

Language: English Format: Print 43 pages SSRNRead Now

Citation:

Simcoe, Timothy, and Michael W. Toffel. "Public Procurement and the Private Supply of Green Buildings." Harvard Business School Working Paper, No. 13–030, September 2012.

About the Author

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Michael W. Toffel
Associate Professor of Business Administration, Marvin Bower Fellow
Technology and Operations Management

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