Extended producer responsibility

About: Extended producer responsibility is a research topic. Over the lifetime, 1120 publications have been published within this topic receiving 26805 citations. The topic is also known as: EPR.

Can Downstream Waste Disposal Policies Encourage Upstream "Design for Environment"?

Abstract: "Design for environment" takes place when firms explicitly incorporate environmental issues in their product design and manufacturing decisions (Joseph Fiksel, 1996). To reduce waste associated with consumer products, for example, firms can reduce product weight, including the amount of packaging that comes with a product, and make products easier and less costly to recycle. The latter can be accomplished by changing the type of material used in a product, avoiding mixing of materials in a single product, coding and labeling when different materials are used, and designing for ease of disassembly (U.S. Congress Office of Technology Assessment, 1992; Fiksel, 1996). An important debate centers around the question of whether design for environment (DfE) needs to be explicitly targeted using policy instruments focused "upstream" on producers or whether "downstream" instruments send sufficient signals back upstream. One important downstream instrument is a disposal fee (i.e., charging households a price per pound, per bag, or per can for their trash). Many observers feel that downstream instruments do not send appropriate signals back upstream.' Some economists and others have suggested, on the other hand, that disposal fees can, in theory, send signals upstream to producers (Karen Palmer and Walls, 1998). We find that disposal fees provide incentives for efficient DfE only when there is a fully functioning recycling market (i.e., only when recyclers pay households a price for each of their recyclable items and that price varies with the degree of product recyclability). In the real world, transactions costs of paying households for each individual item recycled would be prohibitively high. In a more realistic setting in which households may place some items in a recycling bin but are not paid for doing so, a disposal fee by itself will not yield a social optimum. It encourages households to place items in the bin, but all items allowed in the bin are of equal value to the household (i.e., there is no reason to prefer an easily recyclable aluminum can to a difficult-to-recycle plastic milk jug). This means that there is no signal to producers to make products more recyclable. If the government can set product taxes that vary with product recyclability, the social optimum can be restored, but this option is not practicable.2 We argue that the infeasibility of (i) paying households for recycling and (ii) taxing products according to their recyclability means that a first-best outcome is no longer attainable. Instead, we set up a constrained second-best optimum and solve for policy instruments that achieve this outcome. We find that a disposal * School of Economics and Finance, Victoria University of Wellington, Wellington, New Zealand. Walls is also a University Fellow with Resources for the Future, Washington, DC. The helpful comments of Karen Palmer, Don Fullerton. and Hilary Sigman are greatlv appreciated. 1 Manufacturer "take-back" requirements, such as Germany's well-known packaging take-back law, were developed, at least in part, as a way to encourage DfE. See (www.oecd.org/env/epr/index.htm) for updates from a series of OECD workshops held in 1997-1999 on the broader topic of "extended producer responsibility." In practice, individual German producers do not actually take back their own products at end-of-life. They have formed a consortium that arranges to collect members' waste from households (marked with a green dot) and recycle it. We do not address take-back mandates in this paper. 2 In Calcott and Walls (1999), we derive these taxes. Don Fullerton and Wenbo Wu (1998) show that a direct subsidy to recyclability (combined with other instruments) can yield a social optimum. This subsidy depends on production function parameters; thus if firms differ, the subsidy would vary across firms. More i-mportantly, observing and measuring recyclability to determine subsidy payments would be virtually impossible.

Product Design and Supply Chain Coordination Under Extended Producer Responsibility

Abstract: Extended Producer Responsibility (EPR) legislation focuses on the life-cycle environmental performance of products and has significant implications for management theory and practice. In this paper, we examine the influence of EPR policy parameters on product design and coordination incentives in a durable product supply chain. We model a manufacturer supplying a remanufacturable product to a customer over multiple periods. The manufacturer invests in two design attributes of the product that impact costs incurred by the supply chain -- performance, which affects the environmental impact of the product during use, and remanufacturability, which affects the environmental impact post-use. Consistent with the goals of EPR policies, the manufacturer and the customer are required to share the environmental costs incurred over the product's life-cycle. The customer has a continuing need for the services of the product and optimizes between the costs of product replacement and the costs incurred during use. We demonstrate how charges during use and post-use can be used as levers to encourage environmentally favorable product design. We analyze the impact of supply chain coordination on design choices and profit and discuss contracts that can be used to achieve coordination, both under symmetric and asymmetric information about customer attributes.

Product Design and Supply Chain Coordination Under Extended Producer Responsibility

Abstract: Extended Producer Responsibility (EPR) legislation focuses on the life-cycle environmental performance of products and has significant implications for management theory and practice. In this paper, we examine the influence of EPR policy parameters on product design and coordination incentives in a durable product supply chain. We model a manufacturer supplying a remanufacturable product to a customer over multiple periods. The manufacturer invests in two design attributes of the product that impact costs incurred by the supply chain—performance, which affects the environmental impact of the product during use, and remanufacturability, which affects the environmental impact post-use. Consistent with the goals of EPR policies, the manufacturer and the customer are required to share the environmental costs incurred over the product's life cycle. The customer has a continuing need for the services of the product and optimizes between the costs of product replacement and the costs incurred during use. We demonstrate how charges during use and post-use can be used as levers to encourage environmentally favorable product design. We analyze the impact of supply chain coordination on design choices and profit and discuss contracts that can be used to achieve coordination, both under symmetric and asymmetric information about customer attributes.

Waste effectiveness of the construction industry: Understanding the impediments and requisites for improvements

Abstract: Construction industry contributes a large portion of waste to landfill, which in turns results in environmental pollution and CO2 emission. Despite the adoption of several waste management strategies, waste reduction to landfill continues seeming an insurmountable challenge. This paper explores factors impeding the effectiveness of existing waste management strategies, as well as strategies for reducing waste intensiveness of the construction industry. Drawing on series of semi structured focus group discussions with experts from the UK leading construction companies, this paper combines phenomenological approach with a critical review and analysis of extant literatures. Five broad categories of factors and practices are responsible for ineffectiveness of construction and demolition waste management strategies, which subsequently results in waste intensiveness of the industry. These include end of pipe treatment of waste, externality and incompatibility of waste management tools with design tools, atomism of waste management strategies, perceived or unexpected high cost of waste management, and culture of waste behaviour within the industry. To reduce waste intensiveness of the construction industry, the study suggests that six factors are requisites. These are tackling of waste at design stage, whole life waste consideration, compliance of waste management solutions with BIM, cheaper cost of waste management practice, increased stringency of waste management legislation and fiscal policies, and research and enlightenment. The proposed strategies are not only important for achieving low waste construction projects, they are important for reducing waste intensiveness of the construction. Implementation of the suggested measures would drive waste management practices within the construction industry.