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Valuable e-waste: Implications for extended producer responsibility

Author

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  • Gökçe Esenduran
  • Atalay Atasu
  • Luk N. Van Wassenhove

Abstract

Extended Producer Responsibility (EPR)-based product take-back regulation holds OEMs (Original Equipment Manufacturers) of electronics responsible for the collection and recovery (e.g., recycling) of electronic waste (e-waste). This is because of the assumption that recycling these products has a net cost, and unless regulated they end up in landfills and harm the environment. However, in the last decade, advances in product design and recycling technologies have allowed for profitable recycling. This change challenges the basic assumption behind such regulation and creates a competitive marketplace for e-waste. That is, OEMs subject to EPR have to compete with Independent Recyclers (IRs) in collecting and recycling e-waste. Then a natural question is whether EPR achieves its intended goal of increased landfill diversion amid such competition and what its welfare implications are, where welfare is the sum of OEM and IR profits, environmental benefit, and waste-holder surplus. Using an economic model, we find that EPR that focuses on producer responsibility alone may reduce the total landfill diversion and welfare amid competition. A possible remedy in the form of counting IRs collection towards OEM obligations guarantees higher landfill diversion. However, EPR may continue to reduce the total welfare, particularly when OEM recycling replaces more cost-effective IR activity.

Suggested Citation

  • Gökçe Esenduran & Atalay Atasu & Luk N. Van Wassenhove, 2019. "Valuable e-waste: Implications for extended producer responsibility," IISE Transactions, Taylor & Francis Journals, vol. 51(4), pages 382-396, April.
    • Handle: RePEc:taf:uiiexx:v:51:y:2019:i:4:p:382-396
    DOI: 10.1080/24725854.2018.1515515
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    Cited by:

    1. Chen, Yuyu & Li, Bangyi & Zhang, Guoqing & Bai, Qingguo, 2020. "Quantity and collection decisions of the remanufacturing enterprise under both the take-back and carbon emission capacity regulations," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 141(C).
    2. Ximin (Natalie) Huang & Atalay Atasu & L. Beril Toktay, 2019. "Design Implications of Extended Producer Responsibility for Durable Products," Management Science, INFORMS, vol. 67(6), pages 2573-2590, June.
    3. Zhang, Zhichao & Xu, Haiyan & Chen, Kebing & Zhao, Yingxue & Liu, Zhi, 2023. "Channel mode selection for an e-platform supply chain in the presence of a secondary marketplace," European Journal of Operational Research, Elsevier, vol. 305(3), pages 1215-1235.
    4. Yen-Ting Lin & Haoying Sun & Shouqiang Wang, 2020. "Designing Sustainable Products Under Coproduction Technology," Manufacturing & Service Operations Management, INFORMS, vol. 22(6), pages 1181-1198, November.
    5. Ahmed Timoumi & Narendra Singh & Subodha Kumar, 2021. "Is Your Retailer a Friend or Foe: When Should the Manufacturer Allow Its Retailer to Refurbish?," Production and Operations Management, Production and Operations Management Society, vol. 30(9), pages 2814-2839, September.
    6. Emine Sarigöllü & Chenxuan Hou & Myriam Ertz, 2021. "Sustainable product disposal: Consumer redistributing behaviors versus hoarding and throwing away," Business Strategy and the Environment, Wiley Blackwell, vol. 30(1), pages 340-356, January.
    7. Hekimoğlu, Mustafa & Karlı, Deniz, 2023. "Modeling repair demand in existence of a nonstationary installed base," International Journal of Production Economics, Elsevier, vol. 263(C).
    8. Qinrun Zhang, 2021. "China's policy and finding ways to prevent collapse in WEEE processing in the context of the Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and Their Disposal," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 21(4), pages 693-710, December.
    9. Yue Wang & Baoying Xin & Zhe Wang & Bangyi Li, 2019. "Managing Supplier-Manufacturer Closed-Loop Supply Chain Considering Product Design and Take-Back Legislation," IJERPH, MDPI, vol. 16(4), pages 1-26, February.
    10. Bayrak, Busra & Guray, Busra & Uzunlar, Nilsu & Nadar, Emre, 2024. "Diffusion control in closed-loop supply chains: Successive product generations," International Journal of Production Economics, Elsevier, vol. 268(C).
    11. Iyer, Ananth V. & Vedantam, Aditya & Lacourbe, Paul, 2023. "Recycled content claims under demand benefit and supply uncertainty: Multi-period model and application to glasswool insulation," European Journal of Operational Research, Elsevier, vol. 309(2), pages 745-761.
    12. Xu, Jie & Ng, C.T. & Cheng, T.C.E., 2021. "Remanufacturing strategies under product take-back regulation," International Journal of Production Economics, Elsevier, vol. 235(C).
    13. Dong, Rong & Wang, Nengmin & Jiang, Bin & He, Qidong, 2023. "Within-brand or cross-brand: The trade-in option under consumer switching costs," International Journal of Production Economics, Elsevier, vol. 255(C).
    14. Jian Cao & Xihui Chen & Sisi Wu & Sanjay Kumar, 2021. "Evolving remanufacturing strategies in China: an evolutionary game theory perspective," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 23(10), pages 14827-14853, October.
    15. Kleber, Rainer & Reimann, Marc & Souza, Gilvan C. & Zhang, Weihua, 2020. "Two-sided competition with vertical differentiation in both acquisition and sales in remanufacturing," European Journal of Operational Research, Elsevier, vol. 284(2), pages 572-587.
    16. Gulzhazira Ilyassova & Aigul Nukusheva & Leila Arenova & Guldana Karzhassova & Marzhangul Akimzhanova, 2021. "RETRACTED ARTICLE: Prospects of legal regulation in the field of electronic waste management in the context of a circular economy," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 21(3), pages 367-388, September.
    17. Shardul Phadnis & Nitin Joglekar, 2021. "Configuring Supply Chain Dyads for Regulatory Disruptions: A Behavioral Study of Scenarios," Production and Operations Management, Production and Operations Management Society, vol. 30(4), pages 1014-1033, April.
    18. 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).
    19. Luo, Li & Shan, Renbang & Xiang, Jie, 2024. "The government intervention effectiveness in promoting remanufacturing: Subsidy or remanufacturing target?," Socio-Economic Planning Sciences, Elsevier, vol. 92(C).
    20. Qi Feng & Chengzhang Li & Mengshi Lu & J. George Shanthikumar, 2022. "Implementing Environmental and Social Responsibility Programs in Supply Networks Through Multiunit Bilateral Negotiation," Management Science, INFORMS, vol. 68(4), pages 2579-2599, April.
    21. Ma, Peng & Gong, Yeming & Mirchandani, Prakash, 2020. "Trade-in for remanufactured products: Pricing with double reference effects," International Journal of Production Economics, Elsevier, vol. 230(C).
    22. Yuyan Wang & Tingting Yu & Rui Zhou, 2022. "The Impact of Legal Recycling Constraints and Carbon Trading Mechanisms on Decision Making in Closed-Loop Supply Chain," IJERPH, MDPI, vol. 19(12), pages 1-26, June.
    23. Fei Gao & Shiliang Cui & Morris Cohen, 2021. "Performance, Reliability, or Time‐to‐Market? Innovative Product Development and the Impact of Government Regulation," Production and Operations Management, Production and Operations Management Society, vol. 30(1), pages 253-275, January.
    24. Khan, Syed Abdul Rehman & Yu, Zhang & Sharif, Arshian, 2021. "No Silver Bullet for De-carbonization: Preparing for Tomorrow, Today," Resources Policy, Elsevier, vol. 71(C).

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