Plastic Materials and Environmental Externalities: Structural Causes and Corrective Policy

Abstract

Several negative externalities arising from the consumption and disposal of plastics materials are described. Such externalities include the aesthetic damage created by landfills containing plastic waste, the impact to marine life of plastic residuals, the hazardous emissions of plastic incineration, and the economic inefficiencies created by the difficulty of plastic reutilization from recycling. The fundamental causes for the presence of these externalities are explored, including the lack of incentives in present legislation for the development of a recycling infrastructure and fluctuating market conditions for recycled input materials. A corrective policy is then presented which aims to internalize the costs of recycling and to promote R&D activities into the development of efficient, low-contaminant recycling facilities in the US.