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Dynamic efficiency of Extended Producer Responsibility (EPR) instruments in a simulation model of industrial dynamics

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  • Eric BROUILLAT (GREThA, CNRS, UMR 5113)
  • Vanessa OLTRA (GREThA, CNRS, UMR 5113)

Abstract

This paper presents an original approach to the impact of extended producer responsibility instruments for waste prevention upon firms\' innovative strategies and market structure. Our analysis is based on a stylised framework of waste prevention developed in Brouillat (2009a, b). In this framework, products are modelled as multi-characteristic technologies whose evolution depends on firms\' innovation strategies and on the interactions with consumers and post-consumption activities (recycling). This model has been adapted to explore the impact of waste prevention instruments upon industrial dynamics, and more particularly upon firms\' innovative strategies and upon the evolution of products\' characteristics and market structure. We focus on two types of policy instruments: recycling fees and norms. For each instrument, we will consider different policy designs in order to study their effects on industrial dynamics. The main contribution of this paper is to show how this type of simulation model can be used to explore the impact of waste prevention policy instruments on the technological evolution of products, on innovation strategy and on the evolution of firms\' market shares. The introduction of policy instruments in a simulation agent-based model of industrial dynamics enables us to analyse more thoroughly how different policy designs can modify the dynamics of the system and, more particularly, how the incentives and the constraints linked to the policy instruments under consideration shape market selection.

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Bibliographic Info

Paper provided by Groupe de Recherche en Economie Théorique et Appliquée in its series Cahiers du GREThA with number 2011-14.

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Date of creation: 2011
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Handle: RePEc:grt:wpegrt:2011-14

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Related research

Keywords: waste prevention; industrial dynamics; environmental policy; simulation model; extended producer responsibility;

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  1. Walls, Margaret, 2003. "The Role of Economics in Extended Producer Responsibility: Making Policy Choices and Setting Policy Goals," Discussion Papers dp-03-11, Resources For the Future.
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Cited by:
  1. Cainelli, Giulio & Mazzanti, Massimiliano, 2013. "Environmental innovations in services: Manufacturing–services integration and policy transmissions," Research Policy, Elsevier, vol. 42(9), pages 1595-1604.

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