Author

Cabrera, José María ; Caffera, Marcelo ; Cid, Alejandro

Editor

Universidad de Montevideo, Facultad de Ciencias Empresariales y Economía

Date

2020

Extensión

38 p

Abstract

Improper disposition of single-use plastic bags may cause significant environmental impacts that, among other things, pose considerable risks to wildlife and may have economic impacts on activities such as tourism. Awareness of these impacts seems to have increased globally, but in spite of the impressive number of initiatives to reduce the consumption of plastics bags around the world, evaluations of the impacts of these initiatives are scarce. This is particularly true for evaluations of the impact of levies on plastic bags. Our work is the first one-year term formal estimation of the effect of a price on the quantity used of disposable plastic bags with respect to a pre-treatment period of no regulation. Specifically, we evaluate the effect of different prices on the number of single-use plastic bags used by customers of all branches of a national supermarket chain, before and after it implemented a staggered rollout of the pricing across its branches. Using a difference-in-difference identification strategy, with branches that did not price plastic bags serving as our control group, we find that the demand of single-use plastic bags decreased significantly. Depending on the length of the post-treatment period, the number of treated branches, the control group and the level of the price (US$ 0.07 or US$ 0.1 per bag), the estimated drop lies between 70% and 85%. These estimates do not change in value and are statistically robust to (i) different specifications of our basic equation, (ii) the use of synthetic controls as an alternative identification strategy, (iii) the estimation of anticipation effects, and (iv) placebo tests. We do not find evidence consistent with the effect been driven by a loss of sales. Our estimates are consistent with evidence of large elasticities around zero prices in other settings.

Keyword

Small incentives Prices Plastic bags Environmental impacts Wildlife Economic impacts Tourism

Tipo

Reporte técnico

Derechos

Abierto

Versión

Aceptada

Collections

• Documentos de trabajo [74]