Extended Producer Responsibility, Packaging Waste Reduction and Eco-design

The main policy addressing the packaging waste issue in the countries of the European Union has been to define recycling objectives along with Extended Producer Responsibility (EPR). With EPR, producers finance the recycling and management of waste generated by their products. Within this framework, they are expected to internalise waste management costs and engage in eco-design of their packaging, i.e., use less packaging and increase packaging recyclability (e.g., through substitution of materials). EPR has been extended worldwide over recent decades and applied to various waste streams. In this paper, by exploiting temporal variation of an original panel dataset of EPR compliance costs from 25 European countries (1998–2015) and four packaging materials, I evaluate for the first time whether these costs have led to packaging waste reduction and substitution of packaging materials. I find that the EPR financial incentive has resulted in very little (though statistically significant) packaging reduction and no systematic substitution effects between packaging materials.