Tuesday, May 22, 2012

And About Those Reusable Grocery Bags….

Russ Roberts, economist at George Mason University and Stanford’s Hoover Institute, in a recent episode of EconTalk, interviewed Tyler Cowen, economist at George Mason University regarding his new book An Economist Gets Lunch: New Rules for Everyday Foodies. Notable items of interest are the economics of plastic grocery bags, the phenomena of buying local and “plastic” in general.

Many times mantras based on belief systems become mainstream as the notional idea seems intuitive. For example, reusable grocery bags seem more economical and environmentally friendly than plastic grocery bags. Some local politicos through the mechanism of government have even applied the notional proposition to new heights by levying a five cent tax for those opting to use plastic grocery bags, imposed as a supposed behavior incentive to switch to reusable bags (although one could clearly argue the tax is merely a disguised revenue measure). But not all is as it seems when the economics of the notional proposition is examined.

In the case of plastic grocery bags Cowen examined the proposition and the result is:

“Plastic can even be better than having those reusable cloth bags. If you re-use those cloth bags, say, 200 times and up, and don't lose the bag, don't have to buy a new one if the bag gets torn, don't misplace the bag--then the reusable cloth bag does seem to be better. But that's hard to do; and even then you are just at the break-even point. So, the environmental virtues of plastic relative to a lot of alternatives are somewhat under-rated.”

At this point in the interview Russ Roberts adds some interesting observations:

“ Yeah. My county, Montgomery County, has recently put a nickel charge on plastic bags. If you want a plastic bag, you have to pay a nickel. And it's been fascinating to watch what people have done in response to that. My view is I like to pay the nickel. I kind of enjoy paying the nickel, even though I don't like where the nickel goes--which is to fund my county's activities. I kind of like the idea that I am not going to change my bag habit for a nickel. There is some pride left in me. My wife's very different. My wife has cluttered the back of her car with cloth bags and various other mechanisms. I think she usually remembers to bring them in. But, I talk to the cashiers; some people forget to bring them in. Other people, their protest, is to clutch all of the groceries to their bosom and carry them out to the car and sacrifice their time, loading them one by one into the back of their car; and then when they get home--something akin to Costco, by the way. They don't make it easy for you to get the goods en masse into your car. You've got to box them up in difficult ways. But I find that--it's a fascinating thing. You are suggesting that you'd have to use the cloth bag a great number of times.”

Cowen adds:

“That's right. The more effective way to help Planet Earth is just to take fewer trips to the supermarket. Buy more when you are there. Save up; your car will burn less gas; you are more likely to have some beneficial impact that way than trying to clutch it all to your chest and then eventually making more trips to the store.”


The interview then goes to the subject of the somewhat recent phenomena of “buy local”. Critics of buy local have named the phenomena “Buy Loco”. Which way is more economical and environmentally friendly?

The obvious draw back of “buying local” is the failure to take advantage of the concept of comparative advantage. That is, you can grow bananas locally in a green house at an astronomical cost as well as an increased environmental cost or you can allow the bananas to be grown and shipped from those areas that easily grow bananas at low cost and low environmental cost. Further, if one produces an abundance of items that local people consume but still creates a surplus, and if everyone only purchased local, what would happen to the surplus? Another item is how does one buy a washer/dryer, a vehicle, tractor, roofing shingles and so on if the items are not made locally? Obviously trade over a wide geographic area solves many of the immediate draw backs of buying local.

However, beyond the basic items mentioned above, other consequences of buying local are examined by Cowen:

Roberts: “What about eating local--the locavore movement, the idea that we should eat locally grown foods, fruits, vegetables--is gaining in popularity quite a bit. What's your take on that?”

Cowen: “Local food often tastes better, as I mentioned before. But transporting food is 10-15% of the energy cost of food. So to think that by making a stand on eating local, you are addressing the main problem--you are not. A lot of the environmental impacts, the negative ones from food, come from eating meat. A lot of local farmers aren't very efficient. They make a lot of trips in their truck. They don't have economies of scale. Imagine you live in Albuquerque. Try eating local food there and think through your local water policy, and that's an environmental disaster. So, eating local food can be environmentally better, but lots of times it's environmentally worse. And it's in any case not the biggest issue.”

Finally, Cowen makes a very interesting observation regarding “plastic”:


“We are programmed to reject plastic, to think it's corporate. The adjective "plastic" is negative: He's a plastic personality. So, you feel good rejecting plastic. It's a way in which we pursue what I call mood affiliation rather than actually trying to be effective.” (1)


Reusable grocery bag carried nasty norovirus, scientists say, JoNel Aleccia, NBC News


What's in your shopping bag? Bacteria. But, hey, it's natural!, Chicago Tribune.


Scientists:Reusable bags found to have same bacteria as dirty underwear, KSPR.com


Update 01/24/2013




(1) Cowen on Food, EconTalk, 04/23/2012








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