Seminar on July 1, 2015



Extended Producer Responsibility and Secondary Markets for Durable Goods


Atalay Atasu,

(Georgia Tech Scheller College of Business, USA



We analyze the effect of Extended Producer Responsibility (EPR)-based take-back legislation on a durable good producer's secondary market strategy. We show that the effect of EPR and its associated environmental implications depend on the product durability. In the absence of EPR, the producer chooses not to interfere with the secondary market for products with high durability. In such a setting, EPR can provide producers with an incentive to interfere with the secondary market by recovering and prematurely recycling used products to meet the obligations. This in turn leads to lower reuse and higher production levels. For low durability products, the producer readily interferes with the secondary market in the absence of EPR, and the effect of EPR depends on its implementation parameters. In particular, EPR increases (reduces) secondary market interference by the producer when collection targets are high (low) and recycling standards are low (high). These observations, in turn, imply that EPR-based take-back legislation may have unintended consequences in a durable goods setting: It may diminish environmental goals such as reducing new production and increasing reuse levels, two key environmental goals with higher priority than increasing recycling. However, we find that such unintended consequences may be attenuated by increased recycling standards, while more stringent collection targets and infrastructure requirements may backfire in EPR implementations for durable products.


Short Bio: 

Dr. Atalay Atasu is Associate Professor at Georgia Tech Scheller College of Business. He holds a PhD in Management from INSEAD and his research focus is on sustainable operations management. His research interests include product recovery economics, extended producer responsibility and environmental regulation. His research appeared in Management Science, Manufacturing and Service Operations Management, Production and Operations Management, Journal of Industrial Ecology, and California Management Review. He is the recipient of a number of research awards, including the Wickham Skinner Best Paper Award (winner 2007, runner up 2014), Wickham Skinner Early Career Research Award (2012), and Paul Kleindorfer Award in Sustainability (2013). He serves as a senior editor for POMS' Sustainable Operations, and Industry Studies and Public Policy Departments


All interested are cordially invited.  


DATE:  July 1, 2015 

TIME:  Wednesday, 15:00-16:00