IDEAS home Printed from https://ideas.repec.org/a/eee/ejores/v216y2012i2p293-300.html
   My bibliography  Save this article

Recovery decisions of a producer in a legislative disposal fee environment

Author

Listed:
  • Özdemir, Öznur
  • Denizel, Meltem
  • Guide, V. Daniel R.

Abstract

The main objectives of the environmental legislation originating from extended producer responsibility (EPR) principle are to lead producers to undertake recovery initiatives for their end-of-use products and to promote environmentally desirable product design. It is still controversial whether current implementations of EPR principle are effective in attaining these objectives. This study seeks to answer the following questions: (1) What is the impact of EPR legislation on the product recovery decisions of producers? (2) How do the redesign opportunities (i.e., design for disassembly) affect the willingness of producers for product recovery? (3) How do the investment needs to start recovery practices and the reluctance of producers to allocate sufficient funds for this purpose affect the optimal recovery decisions? We use stylized economic models to represent the implementation in practice and solving our models we obtain closed form and numerical solutions that help us to see the impact of various parameters on the optimal decisions of a producer. Our findings indicate that redesign opportunities encourage producers for more recovery, however the reluctance of producers to cover the initial investments may substantially reduce the effectiveness of the legislation and the recovery amounts.

Suggested Citation

  • 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.
    • Handle: RePEc:eee:ejores:v:216:y:2012:i:2:p:293-300
    DOI: 10.1016/j.ejor.2011.07.035
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0377221711006679
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.ejor.2011.07.035?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Don Fullerton & Wenbo Wu, 2002. "Policies for Green Design," Chapters, in: Don Fullerton & Thomas C. Kinnaman (ed.), The Economics of Household Garbage and Recycling Behavior, chapter 5, pages 102-119, Edward Elgar Publishing.
    2. Walls, Margaret, 2006. "Extended Producer Responsibility and Product Design: Economic Theory and Selected Case Studies," RFF Working Paper Series dp-06-08, Resources for the Future.
    3. Walls, Margaret & Palmer, Karen, 2001. "Upstream Pollution, Downstream Waste Disposal, and the Design of Comprehensive Environmental Policies," Journal of Environmental Economics and Management, Elsevier, vol. 41(1), pages 94-108, January.
    4. Erica Plambeck & Qiong Wang, 2009. "Effects of E-Waste Regulation on New Product Introduction," Management Science, INFORMS, vol. 55(3), pages 333-347, March.
    5. Palmer, Karen L. & Walls, Margaret, 1999. "Extended Product Responsibility: An Economic Assessment of Alternative Policies," Discussion Papers 10830, Resources for the Future.
    6. Palmer, Karen & Sigman, Hilary & Walls, Margaret, 1997. "The Cost of Reducing Municipal Solid Waste," Journal of Environmental Economics and Management, Elsevier, vol. 33(2), pages 128-150, June.
    7. Hammond, David & Beullens, Patrick, 2007. "Closed-loop supply chain network equilibrium under legislation," European Journal of Operational Research, Elsevier, vol. 183(2), pages 895-908, December.
    8. Harvey M. Wagner, 1995. "Global Sensitivity Analysis," Operations Research, INFORMS, vol. 43(6), pages 948-969, December.
    9. Calcott, Paul & Walls, Margaret, 2005. "Waste, recycling, and "Design for Environment": Roles for markets and policy instruments," Resource and Energy Economics, Elsevier, vol. 27(4), pages 287-305, November.
    10. 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.
    11. Matthew Simon & Steve Poole & Andrew Sweatman & Steve Evans & Tracy Bhamra & Tim Mcaloone, 2000. "Environmental priorities in strategic product development," Business Strategy and the Environment, Wiley Blackwell, vol. 9(6), pages 367-377, November.
    12. Ferrer, Geraldo, 2001. "On the widget remanufacturing operation," European Journal of Operational Research, Elsevier, vol. 135(2), pages 373-393, December.
    13. Palmer, Karen & Walls, Margaret, 1997. "Optimal policies for solid waste disposal Taxes, subsidies, and standards," Journal of Public Economics, Elsevier, vol. 65(2), pages 193-205, August.
    14. Michael Lenox & Andrew King & John Ehrenfeld, 2000. "An Assessment of Design-for-Environment Practices in Leading US Electronics Firms," Interfaces, INFORMS, vol. 30(3), pages 83-94, June.
    15. Zuidwijk, Rob & Krikke, Harold, 2008. "Strategic response to EEE returns:: Product eco-design or new recovery processes?," European Journal of Operational Research, Elsevier, vol. 191(3), pages 1206-1222, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Xiaoxiao Chang & Guangye Xu & Qian Wang & Yongguang Zhong, 2020. "A Game Theoretic Approach for Eco-Design and Remanufacturing Considering Take-Back Policy," Sustainability, MDPI, vol. 12(17), pages 1-21, September.
    2. Pangburn, Michael S. & Stavrulaki, Euthemia, 2014. "Take back costs and product durability," European Journal of Operational Research, Elsevier, vol. 238(1), pages 175-184.
    3. Chen, Jen-Yi & Dimitrov, Stanko & Pun, Hubert, 2019. "The impact of government subsidy on supply Chains’ sustainability innovation," Omega, Elsevier, vol. 86(C), pages 42-58.
    4. Choi, Tsan-Ming & Chow, Pui-Sze & Lee, Chang Hwan & Shen, Bin, 2018. "Used intimate apparel collection programs: A game-theoretic analytical study," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 109(C), pages 44-62.
    5. Forlin, Valeria & Scholz, Eva-Maria, 2020. "Strategic take-back programs when consumers have heterogeneous environmental preferences," Resource and Energy Economics, Elsevier, vol. 60(C).
    6. Pazoki, Mostafa & Zaccour, Georges, 2019. "A mechanism to promote product recovery and environmental performance," European Journal of Operational Research, Elsevier, vol. 274(2), pages 601-614.
    7. Pazoki, Mostafa & Samarghandi, Hamed, 2020. "Take-back regulation: Remanufacturing or Eco-design?," International Journal of Production Economics, Elsevier, vol. 227(C).
    8. Georgiadis, Patroklos & Athanasiou, Efstratios, 2013. "Flexible long-term capacity planning in closed-loop supply chains with remanufacturing," European Journal of Operational Research, Elsevier, vol. 225(1), pages 44-58.
    9. Marinella Favot, 2014. "Extended producer responsibility and e-waste management: do institutions matter ?," ECONOMICS AND POLICY OF ENERGY AND THE ENVIRONMENT, FrancoAngeli Editore, vol. 2014(1), pages 123-144.
    10. Wang, Jian & He, Shulin, 2023. "Government interventions in closed-loop supply chains with modularity design," International Journal of Production Economics, Elsevier, vol. 264(C).
    11. Meng, Kai & Cao, Ying & Peng, Xianghui & Prybutok, Victor & Gupta, Varun, 2020. "Demand-dependent recovery decision-making of a batch of products for sustainability," International Journal of Production Economics, Elsevier, vol. 224(C).
    12. Liang Shen & Runjie Fan & Yuyan Wang & Zhaoqing Yu & Rongyun Tang, 2020. "Impacts of Environmental Regulation on the Green Transformation and Upgrading of Manufacturing Enterprises," IJERPH, MDPI, vol. 17(20), pages 1-14, October.
    13. Reimann, Marc & Xiong, Yu & Zhou, Yu, 2019. "Managing a closed-loop supply chain with process innovation for remanufacturing," European Journal of Operational Research, Elsevier, vol. 276(2), pages 510-518.
    14. Liu, Zhi & Li, Kevin W. & Tang, Juan & Gong, Bengang & Huang, Jun, 2021. "Optimal operations of a closed-loop supply chain under a dual regulation," International Journal of Production Economics, Elsevier, vol. 233(C).
    15. Jinglve Wang & Hongping Yuan, 2023. "Deciphering the Innovation Subsidy Puzzle: Government Choices amid Supply Chain Encroachment," Mathematics, MDPI, vol. 11(23), pages 1-38, November.
    16. Salman Shooshtarian & Tayyab Maqsood & Peter SP Wong & Malik Khalfan & Rebecca J. Yang, 2021. "Extended Producer Responsibility in the Australian Construction Industry," Sustainability, MDPI, vol. 13(2), pages 1-20, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Walls, Margaret, 2011. "Deposit-Refund Systems in Practice and Theory," RFF Working Paper Series dp-11-47, Resources for the Future.
    2. Hage, Olle, 2007. "The Swedish producer responsibility for paper packaging: An effective waste management policy?," Resources, Conservation & Recycling, Elsevier, vol. 51(2), pages 314-344.
    3. Asuncion Arner Guerre, 2022. "The Extended Producer Responsibility for Waste Oils," International Journal of Energy Economics and Policy, Econjournals, vol. 12(2), pages 210-217, March.
    4. Numata, Daisuke, 2009. "Economic analysis of deposit–refund systems with measures for mitigating negative impacts on suppliers," Resources, Conservation & Recycling, Elsevier, vol. 53(4), pages 199-207.
    5. Luyi Gui & Atalay Atasu & Özlem Ergun & L. Beril Toktay, 2016. "Efficient Implementation of Collective Extended Producer Responsibility Legislation," Management Science, INFORMS, vol. 62(4), pages 1098-1123, April.
    6. Walls, Margaret, 2003. "The Role of Economics in Extended Producer Responsibility: Making Policy Choices and Setting Policy Goals," Discussion Papers 10855, Resources for the Future.
    7. M. Dubois & J. Eyckmans, 2015. "Efficient Waste Management Policies and Strategic Behavior with Open Borders," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 62(4), pages 907-923, December.
    8. Calcott, Paul & Walls, Margaret, 2005. "Waste, recycling, and "Design for Environment": Roles for markets and policy instruments," Resource and Energy Economics, Elsevier, vol. 27(4), pages 287-305, November.
    9. Loukil, Faten & Rouached, Lamia, 2012. "Modeling packaging waste policy instruments and recycling in the MENA region," Resources, Conservation & Recycling, Elsevier, vol. 69(C), pages 141-152.
    10. Matsueda, Norimichi & Nagase, Yoko, 2012. "An economic analysis of the Packaging waste Recovery Note System in the UK," Resource and Energy Economics, Elsevier, vol. 34(4), pages 669-679.
    11. Patrik Söderholm & Tomas Ekvall, 2020. "Metal markets and recycling policies: impacts and challenges," Mineral Economics, Springer;Raw Materials Group (RMG);Luleå University of Technology, vol. 33(1), pages 257-272, July.
    12. Francisco J. André & Emilio Cerdá, 2005. "Gestión de residuos sólidos urbanos: Análisis económico y políticas públicas," Economic Working Papers at Centro de Estudios Andaluces E2005/23, Centro de Estudios Andaluces.
    13. 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.
    14. Acuff, Kaylee & Kaffine, Daniel T., 2013. "Greenhouse gas emissions, waste and recycling policy," Journal of Environmental Economics and Management, Elsevier, vol. 65(1), pages 74-86.
    15. Thomas C. Kinnaman & Don Fullerton, 2002. "The Economics of Residential Solid Waste Management," Chapters, in: Don Fullerton & Thomas C. Kinnaman (ed.), The Economics of Household Garbage and Recycling Behavior, chapter 1, pages 1-48, Edward Elgar Publishing.
    16. Richard Benjamin & Jeffrey Wagner, 2006. "Reconsidering the law and economics of low-level radioactive waste management," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 8(1), pages 33-53, December.
    17. Söderholm, Patrik, 2011. "Taxing virgin natural resources: Lessons from aggregates taxation in Europe," Resources, Conservation & Recycling, Elsevier, vol. 55(11), pages 911-922.
    18. Matthew Gunter, 2007. "Do Economists Reach a Conclusion on Household and Municipal Recycling?," Econ Journal Watch, Econ Journal Watch, vol. 4(1), pages 83-111, January.
    19. Reyer Gerlagh & Etienne Lorang, 2024. "Material Source and Waste Taxes in Competitive Equilibrium," CESifo Working Paper Series 11091, CESifo.
    20. Lehmann, Paul, 2008. "Using a policy mix for pollution control: A review of economic literature," UFZ Discussion Papers 4/2008, Helmholtz Centre for Environmental Research (UFZ), Division of Social Sciences (ÖKUS).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:ejores:v:216:y:2012:i:2:p:293-300. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eor .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.