Resolving information asymmetries in markets
Subtitle: the role of certified management programs
By: Michael W. Toffel
Contributors: Harvard Business School. Division of Research
Series: Working paper / Division of Research, Harvard Business School -- 07-023; Working paper (Harvard Business School. Division of Research) -- 07-023
Publisher: Division of Research, Harvard Business School
Published: 2006
Place of publication: Boston]
Language: eng
Number of pages: 33
Description: Firms and regulators are increasingly relying on voluntary mechanisms to signal and infer quality of difficult-to-observe management practices. Prior evaluations of voluntary management programs have focused on those that lack verification mechanisms and have found little evidence that they legitimately distinguish adopters as having superior management practices or performance. In this paper, I conduct one of the first evaluations to determine whether a voluntary management program that features an independent verification mechanism is achieving its ultimate objectives. Using a sample of thousands of manufacturing facilities across the United States, I find evidence that the ISO 14001 Environmental Management System Standard has attracted companies with superior environmental performance. After developing quasi-control groups using propensity score matching, I also find that adopters subsequently improve their environmental performance.
Notes: "February 1, 2006."

Includes bibliographical references.