See DeCanio,S. J., ‘Barriers Within Firms to Energy-Efficient Investments’, Energy Policy, Vol. 21, No. 9, September,1993, pp. 906–914, for a partial survey of the literature on these technologies. The survey is partial because the literature is so extensive.
2.
It should be noted that the Clinton Administration's recently announced Climate Change Action Plan relies heavily on voluntary, ‘cost effective’ (and therefore, presumably, profitable) measures to achieve the goal of stabilizing greenhouse gas emissions in the United States at their 1990 levels by the year 2000. President William J. Clinton and Vice President Albert Gore, Jr., ‘The Climate Change Action Plan’, Washington DC, October,1993.
3.
US Environmental Protection Agency, ‘Green Lights Update’, Washington DC, August1993.
4.
A Green Lights Participants List is maintained and updated weekly by the US EPA. The number of corporate Partners was 614 as of December 13, 1993. This list includes some non-profit organizations (such as school districts, universities, and hospitals) as well as for-profit enterprises. Information on participation in the program is available from the Green Lights Hotline, 202-775-6650, or through the Green Lights Electronic Bulletin Board, 202-775-6671.
5.
This perfectly descriptive phrase is Schumpeter's, from Capitalism, Socialism and Democracy, New York: Harper & Row, 1942.
6.
A formal model of this possibility is given in Antle,R., and EppenG. D., ‘Capital Rationing and Organizational Slack in Capital Budgeting’, Management Science, Vol. 31, No. 2, February1985, pp. 163–174.
7.
See Ross,M., ‘Perspectives on Capital Budgeting’, Financial Management, Vol. 15, No. 4, Winter 1986, pp. 15–21 for further discussion.
8.
Managers' risk aversion is discussed in Rappaport,A., ‘Executive Incentives vs. Corporate Growth’, Harvard Business Review, Vol. 56, No. 4, July-August 1978, pp. 81–88.
9.
Situations of this type are discussed in Kester,W. C., ‘Today's Options for Tomorrow's Growth’, Harvard Business Review, Vol. 62, No. 2, March-April1984, pp. 153–160; Dixit,A., ‘Investment and Hysteresis‘, The Journal of Economic Perspectives, Vol. 6, No. 1, Winter 1992, pp. 107–132; Pindyck, R. S., ‘Irreversibility, Uncertainty, and Investment’, Journal of Economic Literature, Vol. 29, No. 3, September 1991, pp. 1110–1148; and Bernanke, B.S., ‘Irreversibility, Uncertainty, and Cyclical Investment’, The Quarterly Journal of Economics, Vol. 97, No. 1, February 1983, pp. 85–106.
10.
Representatives of this kind of investigation into the deeper causes of corporate success include Kanter,R. M., The Change Masters, New York: Simon & Schuster, Inc., 1985, and Kotter,J. P., and HeskettJ. L., Corporate Culture and Performance, New York: The Free Press, 1992. These ideas are influential at the highest levels of the US Government. See Reich, R. B., ‘Companies are Cutting Their Hearts Out’, The New York Times Magazine, December 19, 1993, pp. 54–55.
11.
Green Lights participants are subject to minimal reporting requirements. These requirements can be met by returning a single one-page form for each lighting upgrade project undertaken. The 251 projects forming the sample summarized in Figure 1 are taken from the first group of such returns. They are heavily weighted by the experience of a single company, a fast-food chain, but the data do not appear to be unrepresentative of the general experience with energy-saving investments in modern lighting fixtures and controls.
12.
For a complete treatment, see Olson,M., The Rise and Decline of Nations: Economic Growth, Stagflation, and Social Rigidities, New Haven: Yale University Press, 1982.
13.
See, for example, Porter,M. E., ‘ America's Green Strategy’, Scientific American, Vol. 264, No. 4, April1991,p. 168, and Meyer,S. M., ‘Environmentalism and Economic Prosperity: Testing the Environmental Impact Hypothesis’, Massachusetts Institute of Technology, Project on Politics and Policy, Cambridge, Massachusetts, 1992.
14.
DeCanioS. J. ‘Energy Efficiency and Managerial Performance: Improving Profitability While Reducing Greenhouse Gas Emissions’, in FeldmanDavid L. and MannDean (eds.), Global Climate Change and Public Policy, Policy Studies Organization, 1994.
