How regulatory measures towards biobased packaging influence the strategic behaviour of the retail industry: A microempirical study

Germany set a new record in waste production in 2017 and thus occupies one of the top ranks in the EU in terms of garbage creation. However, whether and how much of the waste can be recycled at all depends strongly on the material and its properties, whereby the recycling rate for plastics is still moderate. Environmental damage from plastic packaging can be avoided by using biobased substitute materials. To achieve this, the costs for plastic must first be increased in order to make these alternatives attractive in terms of price. This paper reports on a study dealing with regulatory measures to mitigate the waste problem from an economic point of view. It discusses the results of a choice-based experiment with 253 industrial decision-makers from the German Food and Technics retail segment. Regulatory scenarios, such as Pigou tax on plastic packaging or product labelling about environmental impact, were specified as a means to avoid market failure, and the attitude of the respondents were measured. The data analysis showed that the additional costs of switching to biomaterials are more likely to be passed on to the market by SMEs (100%) in the form of price increases (p = .01; phi = .28) and that quality reductions tend to be considered by the food industry (p < .05; phi = .39). Hence, large companies (65.2%) and the Technical goods traders (35.7%) showed a tendency to be prepared to bear part of the change costs. The packaging weight was favoured by the majority as the basis for taxation (>48%), and it was proposed to indicate the packing's CO2-emissions using a traffic light scheme (>47%). Finally, it was found that trading companies in general had only a small influence on the packaging properties of their suppliers' products (<32%). From this it can be concluded that impulses for plastic avoidance should rather be set by government regulatory instruments than by self-regulation on the part of the retail industry, which, however, with an average of 30% plastic recycling in packaging, is already making a significant contribution to avoidance. Finally, it is recommended that economic explanatory models should integrate the variables Company Size and Product Category for reliable economic predictions. (C) 2020 Elsevier Ltd. All rights reserved.