Study Overview
In response to growing stakeholder concerns about climate change, firms are joining industry carbon net-zero alliances—collective commitments by firms in the same industry to achieve net-zero carbon emissions. These alliances promise coordinated decarbonization efforts and greater influence over supply chain partners and policy through higher credibility. However, they raise antitrust concerns that competitors may use these climate alliances to act as a “cartel,” reducing consumer welfare. We study the anticompetitiveness and effectiveness of industry net-zero alliances, focusing on U.S. airlines.
Study Results
Using airline ticket data, we find no evidence of collusion: alliance members do not raise prices or restrict output compared to non-members, even in routes they collectively dominate. However, firm-year analyses reveal no improvement in emissions or environmental performance. Overall, our results suggest that industry net-zero alliances function as “cheap talk alliances” that are neither collusive nor effective, at least in the near term. We discuss the paradox of climate alliances, illustrating how regulatory concerns can hinder the effectiveness of the alliances. We conclude by examining other potential benefits of industry climate alliances that pose fewer antitrust concerns. Our descriptive evidence indicates that the alliance functions as a hub for collective policy engagement and that member firms increase their disclosures and future initiatives related to sustainable aviation fuel—the industry’s priority for decarbonization.
News & media
Beyond the Classroom: Learning from research on ESG policies
May 28, 2026
Over the past few decades, Environmental, Social, and Governance (ESG) policies have become the dominant framework through which businesses signal their commitment to the planet. But as I dug deeper, I kept running into the same uncomfortable question – are these commitments real or are they just tools for marketing?