Design implications of extended producer responsibility for durable products

Ximin Huang, Atalay Atasu, L. Beril Toktay

Research output: Contribution to journalArticle

2 Citations (Scopus)

Abstract

We analyze product design implications of extended producer responsibility (EPR)-based take-back legislation on durable goods. In particular, we observe that durable product design incentives under EPR may involve an inherent trade-off that has not been explored to date: Durable goods producers can respond to EPR by making their products more recyclable or more durable, where the former decreases the unit recycling cost and the latter reduces the volume the producer has to recycle. When these two design attributes do not go hand in hand, as is the case for many product categories, product design implications of EPR can be counterintuitive. We find that more stringent collection targets (defined as the portion of total product volume to be collected) or recycling targets (defined as the portion of each collected product unit to be recycled) may imply reduced recyclability or durability. Moreover, although collection and recycling targets appear to be similar EPR implementation levers for increasing the total amount of materials recycled, they, in fact, have opposing effects in driving producers’ design choices. As a result, EPR may have unintended consequences for the environment. A calibrated numerical study on the photovoltaic panel (PVP) industry allows us to show that more stringent EPR requirements (such as those proposed by the recent recast of the WEEE directive) can lead to a PVP technology choice with lower recyclability and higher durability and, consequently, result in higher greenhouse gas emissions. These results call for a careful analysis of the benefits of EPR legislation in the context of durable goods.

Original languageEnglish (US)
Pages (from-to)2573-2590
Number of pages18
JournalManagement Science
Volume65
Issue number6
DOIs
StatePublished - Jun 2019

Fingerprint

Extended producer responsibility
Durables
Product design
Legislation
Durability
Trade-offs
Product category
Technology choice
Costs
Industry
Unintended consequences
Recycle
Greenhouse gas emissions
Incentives

Keywords

  • Durability
  • Extended producer responsibility
  • Recyclability
  • Take-back legislation

Cite this

Design implications of extended producer responsibility for durable products. / Huang, Ximin; Atasu, Atalay; Beril Toktay, L.

In: Management Science, Vol. 65, No. 6, 06.2019, p. 2573-2590.

Research output: Contribution to journalArticle

Huang, Ximin ; Atasu, Atalay ; Beril Toktay, L. / Design implications of extended producer responsibility for durable products. In: Management Science. 2019 ; Vol. 65, No. 6. pp. 2573-2590.
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