A STUDY ON MEDIATING IMPACT OF ECO-LITERACY ON GREEN CONSUMPTION BEHAVIOR: AN EMPIRICAL ASSESSMENT OF MALAYSIA CONSUMER TOWARD SOLAR POWER RENEWABLE ENERGY LIM THYE KONG SCHOOL OF BUSINESS ADMINISTRATION WAWASAN OPEN UNIVERSITY PENANG, MALAYSIA 2016 i NAME Lim Thye Kong DEGREE Commonwealth Executive Master of Business Administration SUPERVISOR Dr. Quah Hock Soon TITLE A Study On Mediating Impact of Eco-Literacy On Green Consumption behavior: An Empirical Assessment of Malaysia Consumer Toward Solar Power Renewable Energy. DATE Nov 2016 INSTITUTION Wawasan Open University (WOU), Penang, Malaysia Final Project Report submitted in partial fulfillment of the requirements for the award of Commonwealth Executive Master of Business Administration (CeMBA) of Wawasan Open University Penang, Malaysia ii ACKNOWLEDGEMENTS The route to pursue the CeMBA certification is not easy journey and become challenging for me as full time working student. I am always busy with my M & E construction works even through on the weekend and public holiday. Hence, time management, dedication and commitment are important factors for me to keep up my spirit to accomplish the final objective completion of my CeMBA program at WOU. Normally, search the project title and selecting the right title for research study always is headache for every post graduate student and included me as well. I am so lucky to select the talented project supervisor, Dr. Quah Hock Soon, to help me to determine my interest project field and decide for project research title. I would like to express my sincere gratitude to Dr. Quah for the kindness guidance and advices, when I was facing any doubt and problem throughout the process of the research works. His strong point is in SPSS data analysis will indirectly guide me to perform my collected data analysis more effectively. I would like to express appreciation to Mr. Chong Fook Suan, course coordinator for final project for helpful assistance on sharing the information via WOU Project LMS. I would like to extent my special thanks to all the M & E Business partner, friend and classmate who had willing to spend their precious time for answering the survey especially my good friend Mr. Chan Wah Cheong to give his comment on the questionnaires for pilot test. Lastly, I would like to thank my loved wife for her understanding, motivation and encouragement in the course of study. Without her inspiring & moral support, I would not be able to success to attain my dream. Lim Thye Kong Nov 2016 iii TABLE OF CONTENTS Contents Page Title Page I Acknowledgements iii Certificate of Originality iv Plagiarism Statement v Table of Contents vi List of Tables ix List of Figures xi Abbreviations xii Abstract xiv Chapter 1 Introduction to the Study 1 1.1 Introduction 1 1.2 Research Title 4 1.3 Research Background 4 1.4 Problem Statements 9 1.5 Rationale of the Study 11 1.6 Research Objectives 12 1.7 Research Questions 14 1.8 Expected Contributions of the Study 15 1.9 Research Scope 15 1.10 Definitions 16 1.11 Summary of the Introduction 17 Chapter 2 Review of the literature 18 2.1 Introduction 18 2.2 Theory of Purchase & Consumption Behavior Model 18 2.2.1 Theory of Reasoned Action (TRA) 19 2.2.2 Theory of Planned Behavior (TRB) 20 2.3 Principles, Concepts and Indicators of Solar Power 21 2.3.1 Malaysia Climate 22 2.3.2 Solar PV site installation Sites 24 2.3.3 Market Share of Different Types Solar PV cell technologies 24 2.3.4 Solar PV installation capacity around Malaysia 25 2.4 Solar Power Market Outlook in the Global circumstance 27 2.5 Solar Powers Market Outlook in Malaysia 30 2.6 Green Consumption behavior 32 2.7 Green Consumption Behavior Dimensions 33 2.7.1 Environmental Attitude 33 2.7.2 Social responsibility 34 2.7.3 Perceived Self- Image 35 2.7.4 Government incentive 37 2.7.4 Eco-literacy 39 2.8 Demographic Difference on the perception of Green Consumption behavior 40 vi TABLE OF CONTENTS Contents Page 2.9 Study Variables and the Sources 41 2.10 Theoretical Framework 44 2.11 Summary of the Literature Review 47 Chapter 3 Research Methodology 48 3.1 Introduction 48 3.2 Research Design 49 3.3 Data Collection Methods 50 3.4 Sampling Method 53 3.5 Questionnaire Design 54 3.6 Pilot Test 56 3.7 Construct Development 57 3.8 Data Analysis 58 3.8.1 Goodness and Correctness of Data 58 3.8.2 Descriptive Analysis 59 3.8.3 Inferential Analysis 59 3.8.3.1 Factor Analysis 60 3.8.3.2 Reliability Analysis 61 3.8.3.3 Pearson Correlation 61 3.8.3.4 Regression Analysis 62 3.8.3.5 Hierarchical Regression 63 3.8.3.6 ANOVA 64 3.9 Assumption 65 3.10 Summary of the Research Methodology 65 Chapter 4 Analysis of Results 66 4.1 Introduction 66 4.2 Demographic Profiles of Respondents 67 4.3 Factor Analysis 89 4.3.1 Environmental Attitude 89 4.3.2 Social responsibility 98 4.3.3 Perceived Self- Image 104 4.3.4 Government incentive 109 4.3.5 Eco-literacy 118 4.3.6 Green Consumption behaviour. 124 4.4 Reliability Analysis 129 4.5 Descriptive Analysis of Variables 132 4.5.1 Normality Test 134 4.6 Correlation among all Variables 138 4.7 Testing of Hypotheses 141 4.7.1 Testing of Hypothesis 1 141 vii TABLE OF CONTENTS Contents Page 4.7.2 Testing of Hypothesis 2 145 4.7.3 Testing of Hypothesis 3 148 4.7.4 Testing of Hypothesis 4 152 4.7.5 Testing of Hypothesis 5 155 4.7.6 Testing of Hypothesis 6 for Demographics 157 4.7.7 Summary of Hypotheses Testing for Variables 158 4.7.8 Summary of Hypotheses Testing for Demographic Profiles 159 4.8 Hierarchical Multiple Regression Test 160 4.9 Predictive Model for the Research 164 4.10 Summary of the Analysis of Results 166 Chapter 5 Findings, Recommendations and Conclusions 168 5.1 Introduction 168 5.2 Discussion on Findings and Results of Hypotheses Testing 168 5.2.1 Hypothesis 1a (H1a): 168 5.2.2 Hypothesis 1b (H1b): 169 5.2.3 Hypothesis 2a (H2a): 170 5.2.4 Hypothesis 2b (H2b): 170 5.2.5 Hypothesis 3a (H3a): 171 5.2.6 Hypothesis 3b (H3b): 171 5.2.7 Hypothesis 4a (H4a): 172 5.2.8 Hypothesis 4b (H4b): 173 5.2.9 Hypothesis 5 (H5): 174 5.2.10 Hypothesis 6a (H6a): 174 5.2.11 Hypothesis 6b (H6b): 175 5.2.12 Hypothesis 7a (H7a): 176 5.2.13 Hypothesis 7b (H7b): 176 5.2.14 Hypothesis 7c(H7c): 177 5.2.15 Hypothesis 7d (H7d): 177 5.3 Reaffirmation to Research Questions 179 5.4 Reaffirmation to Research Objectives 181 5.5 Implications of the Study 183 5.5.1 Theoretical Implications 184 5.5.2 Practical Implications 184 5.6 Limitations of Research 186 5.6.1 Time Horizon 186 5.6.2 Restriction based on Generalisation 186 5.6.3 Time ad Resource Limitations 187 5.6.4 Scope of Factors/ Dimensions 187 5.6.5 Social Desirability and Cultural Influence 188 5.7 Recommendations for Future Research 188 5.8 Conclusion 190 References 193 Appendices 200 Appendix A Questionnaire Cover Letter 201 Appendix B Survey Questionnaire – Quantitative Study 202 viii LIST OF TABLES Table No. Description Page 1.1 Timelines of solar power historical evolution 5 2.1 General View of the global Solar PV Manufacturer in Malaysia 30 2.2 Study Variables and Literature Sources 41 2.3 Summary of Dimensions of the Variables 47 3.1 Pearson’s correlation coefficient Strength of associations between two variable 61 4.1 Demographic Profiles of Respondents 68 4.2 KMO and Bartlett’s Test for Environmental Attitude 89 4.3 Correlation Matrix for Environmental Attitude 90 4.4 Communalities for Environmental Attitude 91 4.5 Total Variance Explained for Environmental Attitude 92 4.6 Component Matrix for Environmental Attitude 93 4.7 Rotated Component Matrix for Environmental Attitude 94 4.8 Factor Analysis for Environmental Attitude (2nd Iteration) 95 4.9 Factor Loading for Environmental Attitude 98 4.10 KMO and Bartlett’s Test for Social Responsibility 98 4.11 Correlation Matrix for Social Responsibility 99 4.12 Communalities for Social Responsibility 100 4.13 Total Variance Explained for Social Responsibility 101 4.14 Component Matrix for Social Responsibility 102 4.15 Factor Loading for Social responsibility 103 4.16 KMO and Bartlett’s Test for Perceived Self- Image 104 4.17 Correlation Matrix for Perceived Self- Image 105 4.18 Communalities for Perceived Self- Image 106 4.19 Total Variance Explained for Perceived Self- Image 106 4.20 Component Matrix for Perceived Self- Image 107 4.21 Factor Loading for Perceived Self- Image 108 4.22 KMO and Bartlett’s Test for Government Incentive 109 4.23 Correlation Matrix for Government Incentive 110 4.24 Communalities for Government Incentive 111 4.25 Total Variance Explained for Government Incentive 112 4.26 Component Matrix for Government Incentive 113 4.27 Rotated Component Matrix for Government Incentive 114 4.28 Factor Analysis for Government Incentive (2nd Iteration) 115 4.29 Factor Loading for Government Incentive 118 4.30 KMO and Bartlett’s Test for Eco-literacy 119 4.31 Correlation Matrix for Eco-literacy 120 4.32 Communalities for Eco-literacy 121 4.33 Total Variance Explained for Eco-literacy 121 4.34 Component Matrix for Eco-literacy 122 4.35 Factor Loading for Eco-literacy 123 4.36 KMO and Bartlett’s Test for Green Consumption behaviour.