Regulation and competition in the extended producer responsibility models: Results in the WEEE sector in Europe

Abstract

The application of extended producer responsibility (EPR) in Europe has followed different patterns, with varying intensity of competition among producer organisations responsible for meeting take-back and recycling obligations. The literature has suggested possible reasons in favour or against the creation of dedicated compliance organisations, and arguments in support or against having many alternative recycling schemes competing on the market. However, little has been done on the empirical side to test these hypotheses. Our study contributes to filling this gap in the empirical literature by analysing the effect of competition and regulation in the field of waste from electric and electronic equipment (WEEE). We exploit an original database to provide an econometric assessment of the effects of competition and regulation on the cost of dealing with WEEE. The European case is interesting since all member country are subject to the same policy targets imposed by EU directives but enjoy significant degrees of freedom in choosing the policy mix and the industrial structure to which the achievement of policy targets is devoted. Our results are several. First, we provide valuable details on EPR models. Second, we present collection and economic results achieved by compliance organisations. Third, with a statistical analysis based on the panel data structure, we provide significant evidence that a more competitive market structure allows achieving the same collection outcomes at a lower cost. This result is potentially relevant for waste management policies since it encourages the search for a more articulated market architecture for the design of EPR systems.