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Extended Product Responsibility: An Economic Assessment of Alternative Policies

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  • Palmer, Karen

    () (Resources for the Future)

  • Walls, Margaret

    () (Resources for the Future)

Abstract

Extended Product Responsibility embodies the notion that agents along a product chain should share responsibility for the life-cycle environmental impacts of the product, including those associated with ultimate disposal. Extended Producer Responsibility is a narrower concept which places responsibility on producers and focuses primarily on post-consumer waste disposal. Manufacturer "take-back" requirements are the policy lever most often associated with Extended Producer Responsibility. In this paper, the authors discuss alternative incentive-based policies that are consistent with the objectives of Extended Product and Producer Responsibility. They argue that an upstream combined product tax and recycling subsidy (UCTS) is generally more cost-effective and imposes fewer transactions costs than the take-back approach. They also consider the strengths and weaknesses of a policy not targeted at producers: unit-based pricing of residential waste collection and disposal. The authors find that this option shows potential for achieving non-trivial reductions in solid waste. Widespread application in the U.S. of a $1.00 charge per 32-gallon bag could reduce total municipal solid waste disposed by approximately 13 percent per year.

Suggested Citation

  • Palmer, Karen & Walls, Margaret, 1999. "Extended Product Responsibility: An Economic Assessment of Alternative Policies," Discussion Papers dp-99-12, Resources For the Future.
  • Handle: RePEc:rff:dpaper:dp-99-12
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    File URL: http://www.rff.org/RFF/documents/RFF-DP-99-12.pdf
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    References listed on IDEAS

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    Cited by:

    1. Chen, Yenming J. & Sheu, Jiuh-Biing, 2009. "Environmental-regulation pricing strategies for green supply chain management," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 45(5), pages 667-677, September.
    2. Mazzanti, Massimiliano & Zoboli, Roberto, 2006. "Economic instruments and induced innovation: The European policies on end-of-life vehicles," Ecological Economics, Elsevier, vol. 58(2), pages 318-337, June.
    3. Özdemir, Öznur & Denizel, Meltem & Guide, V. Daniel R., 2012. "Recovery decisions of a producer in a legislative disposal fee environment," European Journal of Operational Research, Elsevier, vol. 216(2), pages 293-300.
    4. Margaret Walls & Paul Calcott, 2000. "Can Downstream Waste Disposal Policies Encourage Upstream "Design for Environment"?," American Economic Review, American Economic Association, vol. 90(2), pages 233-237, May.
    5. Asunción Arner Güerre & Ramón Barberán Ortí & Jesús Mur Lacambra, 2003. "Las políticas públicas de fomento del reciclaje: La regeneración de aceites usados," Hacienda Pública Española, IEF, vol. 167(4), pages 33-55, December.
    6. 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.
    7. Marco Runkel, 2003. "Product Durability and Extended Producer Responsibility in Solid Waste Management," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 24(2), pages 161-182, February.

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