How consumers of plastic water bottles are responding to environmental policies?

Abstract

Although plastic induces environmental damages, almost all water bottles are made from plastic and the consumption never stops increasing. This study evaluates the consumers' willingness to pay (WTP) for different plastics used for water packaging. Successive messages emphasizing the characteristics of plastic are delivered to consumers allowing explaining the influence of information on the consumers' WTP. We find that information has a manifest effect on the WTP. We show there is a significant premium associated with recycled plastic packaging and biodegradable bioplastic packaging. As there is no consensus on the plastic which is the most or the least dangerous for the environment, we propose different policies for protecting the environment. We discuss about the impact of these policies on consumer's purchasing decisions: switching one plastic packaging for another, or leaving water plastic bottles market. We present the environmental policies that are effective according to the point of view adopted. Choosing between these policies then depends on the priorities of the regulator and pressure of lobbies.

Keywords: Biodegradable plastic bottles; Bioplastic bottles; Information campaign; Recycling plastic bottles; Regulation; Willingness to pay.