Economic policy instruments for plastic waste

A review with Nordic perspectives

image of Economic policy instruments for plastic waste

Achieving a high quality of waste plastic materials and recycling processes is a key challenge in closing the resource loops for plastics. This report reviews the status and trends for plastic waste flows and treatment in Denmark, Finland, Norway and Sweden. Furthermore, it gives an overview of existing policy instruments and the main challenges for designing policy instruments for improved recycling of plastic waste in these Nordic countries. The report identifies potential market failures associated with closing the resource loops for plastics. It reviews the economics research literature on policy instrument design for achieving optimal recycling rates and makes policy recommendations from the Nordic perspective. Finally, it presents results from a survey on market conditions to managers in the recycling and plastic manufacturing industry in Sweden.



Recyclers and Manufacturers

Recyclers take “upstream” decisions about the design of recycling program, collection infrastructure and pricing policies for collection services (which affect inconvenience costs and the incentives of households and industry for sorting and separation). Recyclers also take “downstream” decisions about treatments in the recycling process or incineration, landfill or even export of waste plastics. Market failures in these decisions may occur since recyclers often only take into account their own operating costs and not the social externalities (figure 6 in chapter 5). The market conditions or its actors, recyclers and plastic manufacturers, are not so well studied in the economics research literature as households. A literature review as well as a survey to 62 managers in recycling and plastic manufacturing industry in Sweden was implemented as part of the actor analysis in this project. Due to the limited size and time constraint of the project it was not possible to make a survey in all four Nordic countries. Sweden was chosen because IVL could use its existing contact lists to find managers in the plastic recycling and manufacturing industry. However, we imagine that these managers are representative also for the other Nordic countries since markets of recycling and manufacturing are international.


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