Question

An essay in the New York Times discussed the fact that few people use reusable bags when they shop for groceries. The essay states the various environmental problems with the plastic bags used by grocery stores:

Billions of plastic bags clogging landfills, killing aquatic creatures on the bottoms of oceans and lakes, and blowing in the wind.

It concedes that reusable grocery bags are only a small part of the environmental picture, but concludes with the point that, “[. . . ] but if you think, if we can’t change our behavior to deal with this one, we can’t change our behavior to deal with anything”.

(a) Explain in economic terms why our current use of shopping bags may be inefficient.

(b) Suppose that shopping bags keep blowing into the Lake Erie. The Toledo city council decides to charge a $60 annual “bag control” fee for each resident in Toledo, which becomes part of the property tax charged to property owners. Will this fee cause a reduction in the number of plastic grocery bags by city residents? Why or why not?

Answer 1

a) Two most important fact about the use of plastic bags are

1. High cost of production : The cost of producing the plastic bags are high and also uses high amount of energy to produce these plastic bags.
2. Depleting non- renewable resources : The production of plastic bags are done from the non-renewable resources which means that in future the depletion rate is much higher and this will affect the energy sector and eventually the economy.
3. The affect on environment: Initially it might look that the use of plastic is just environmentally harmful, however in long run to compensate for the environment loss, one will have to pay millions. The cleaning of water bodies is probably the first mammoth task, both in terms of money and labor.

b) It will not really affect the usage as it has been empirically proven that the ease of carrying the products brought will be chosen over the cost incurred. Plastic bags provide an ease which is not forgone, despite increase in the price or tax. Also, once an area puts a ban or a tax, the cities near by which dont have such techniques start flourishing.