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Extended producer responsibility instruments and innovation in eco-design: An exploration through a simulation model

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  • Brouillat, Eric
  • Oltra, Vanessa

Abstract

This paper presents an agent-based simulation model that models both economical and physical relations between firms, recyclers and consumers. This framework allows an investigation into the connection between physical environmental variables (waste flows, virgin material flows) and economic decisions of agents in the product chain i.e. firms innovation strategies, consumers choices and development of recycling activities. The paper highlights the value of using agent-based modeling as an operational tool to investigate the effect of waste prevention policy on economic and technological decisions of agents. We focus on three types of extended producer responsibility (EPR) instruments, which are recycling fees, tax-subsidy and norms. The simulation results show that the impact of each instrument depends on the policy design, in particular on the level of stringency and on the reward system which is implemented. We show that only tax-subsidy systems and stringent norms can lead to radical innovations and to significant changes in product designs. In the case of tax-subsidy, the impact relies more on an innovation effect, while in the case of norm it mainly relies on a selection effect.

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  • Brouillat, Eric & Oltra, Vanessa, 2012. "Extended producer responsibility instruments and innovation in eco-design: An exploration through a simulation model," Ecological Economics, Elsevier, vol. 83(C), pages 236-245.
    • Handle: RePEc:eee:ecolec:v:83:y:2012:i:c:p:236-245
    DOI: 10.1016/j.ecolecon.2012.07.007
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    Cited by:

    1. Ana Maria Ifrim & Iuliana Camelia Stoenica & Anca Gabriela Petrescu & Florentina Raluca Bilcan, 2018. "The Impact of Green Innovation on Organizational Performance: Evidence from Romanian SMEs," Academic Journal of Economic Studies, Faculty of Finance, Banking and Accountancy Bucharest,"Dimitrie Cantemir" Christian University Bucharest, vol. 4(1), pages 82-88, March.
    2. Ishimura, Yuichi, 2022. "The effects of the containers and packaging recycling law on the domestic recycling of plastic waste: Evidence from Japan," Ecological Economics, Elsevier, vol. 201(C).
    3. Zhangsheng Liu & Liuqingqing Yang & Liqin Fan, 2021. "Induced Effect of Environmental Regulation on Green Innovation: Evidence from the Increasing-Block Pricing Scheme," IJERPH, MDPI, vol. 18(5), pages 1-15, March.
    4. Nabila Arfaoui, 2014. "Eco-innovation and Regulatory Push/Pull Effect in the Case of REACH Regulation: Empirical Evidence from Survey Data," GREDEG Working Papers 2014-19, Groupe de REcherche en Droit, Economie, Gestion (GREDEG CNRS), Université Côte d'Azur, France, revised Dec 2015.
    5. Cao, Jian & Lu, Bo & Chen, Yangyang & Zhang, Xuemei & Zhai, Guangshu & Zhou, Gengui & Jiang, Boxin & Schnoor, Jerald L., 2016. "Extended producer responsibility system in China improves e-waste recycling: Government policies, enterprise, and public awareness," Renewable and Sustainable Energy Reviews, Elsevier, vol. 62(C), pages 882-894.
    6. Faten Loukil & Lamia Rouached, 2014. "Implementing Extended Producer Responsibility: Comparative Analysis of Packaging Waste Management," Working Papers 879, Economic Research Forum, revised Nov 2014.
    7. Hartmann, Julia & Inkpen, Andrew & Ramaswamy, Kannan, 2022. "An FsQCA exploration of multiple paths to ecological innovation adoption in European transportation," Journal of World Business, Elsevier, vol. 57(5).
    8. Frank Beckenbach & Maria Daskalakis & David Hofmann, 2018. "Agent-Based Analysis of Industrial Dynamics and Paths of Environmental Policy: The Case of Non-renewable Energy Production in Germany," Computational Economics, Springer;Society for Computational Economics, vol. 52(3), pages 953-994, October.
    9. Hörisch, Jacob & Ortas, Eduardo & Schaltegger, Stefan & Álvarez, Igor, 2015. "Environmental effects of sustainability management tools: An empirical analysis of large companies," Ecological Economics, Elsevier, vol. 120(C), pages 241-249.
    10. Massarutto, Antonio, 2014. "The long and winding road to resource efficiency – An interdisciplinary perspective on extended producer responsibility," Resources, Conservation & Recycling, Elsevier, vol. 85(C), pages 11-21.
    11. Natasha Hazarika, 2021. "R&D Intensity and Its Curvilinear Relationship with Firm Profitability: Perspective from the Alternative Energy Sector," Sustainability, MDPI, vol. 13(9), pages 1-17, April.
    12. Curtin, Joseph & McInerney, Celine & Ó Gallachóir, Brian, 2017. "Financial incentives to mobilise local citizens as investors in low-carbon technologies: A systematic literature review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 75(C), pages 534-547.
    13. Mansikkasalo, Anna & Lundmark, Robert & Söderholm, Patrik, 2014. "Market behavior and policy in the recycled paper industry: A critical survey of price elasticity research," Forest Policy and Economics, Elsevier, vol. 38(C), pages 17-29.
    14. Zhang, Qi & Tang, Yanyan & Bunn, Derek & Li, Hailong & Li, Yaoming, 2021. "Comparative evaluation and policy analysis for recycling retired EV batteries with different collection modes," Applied Energy, Elsevier, vol. 303(C).
    15. Eugénie Joltreau, 2022. "Extended Producer Responsibility, Packaging Waste Reduction and Eco-design," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 83(3), pages 527-578, November.
    16. Gotsch, Matthias & Kelnhofer, Anton & Jäger, Angela, 2019. "Environmental product innovations and the digital transformation of production: Analysing the influence that digitalising production has on generating environmental product innovations," Working Papers "Sustainability and Innovation" S07/2019, Fraunhofer Institute for Systems and Innovation Research (ISI).
    17. Maria Cipollina & Rosa Maria Fanelli, 2024. "Internationalization and Innovation Challenges in the Context of Sustainable Development: The Case of Italian Regions," Regional Economy, , vol. 8(Q1), pages 12-26.
    18. Jana Hojnik, 2017. "In Pursuit of Eco-innovation," UPP Monograph Series, University of Primorska Press, number 978-961-7023-53-4.
    19. Eug?nie Joltreau, 2018. "Pricing products? negative externalities at end-of-life using eco-modulation: Discussion from case studies," ECONOMICS AND POLICY OF ENERGY AND THE ENVIRONMENT, FrancoAngeli Editore, vol. 2018(1), pages 149-172.
    20. Arfaoui, Nabila & Brouillat, Eric & Saint Jean, Maïder, 2014. "Policy design and technological substitution: Investigating the REACH regulation in an agent-based model," Ecological Economics, Elsevier, vol. 107(C), pages 347-365.
    21. Sylvie Geisendorf & Christian Klippert, 2022. "Integrated sustainability policy assessment – an agent-based ecological-economic model," Journal of Evolutionary Economics, Springer, vol. 32(3), pages 1017-1048, July.
    22. Bergek, Anna & Berggren, Christian, 2014. "The impact of environmental policy instruments on innovation: A review of energy and automotive industry studies," Ecological Economics, Elsevier, vol. 106(C), pages 112-123.

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    More about this item

    Keywords

    Extended producer responsibility; Eco-innovation; Policy instruments; Simulation models;
    All these keywords.

    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling

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