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What are the strongest arguments against EPR?

Most published criticism of extended producer responsibility is weak, because most of it is produced by parties with a financial interest in the outcome and is written to persuade rather than to establish. This article is not that. It sets out the strongest available version of each objection as its most capable proponents actually make it, identifies precisely who advances it and on what evidentiary basis, and states the best answer to each.

Two features of the critical landscape shape everything that follows. First, the objections come from two opposite directions that are routinely conflated: an economic and industry critique arguing EPR costs too much and achieves too little, and an environmental critique arguing EPR entrenches recycling at the expense of prevention and reuse. These are not variants of one argument. They imply opposite remedies. Second, the critique with the strongest evidentiary standing — the design-signal critique — comes not from advocacy at all but from the OECD and a Dutch government analytical agency, and it is the one least often quoted in political argument.

Disclosure

Several of the empirical claims discussed in Section 3 and Section 5 originate in the work of this library's author, Calvin Lakhan (York University). Where that is so, it is stated in the text along with the publication channel and review status, and those findings are weighted accordingly — as single-author working papers and commissioned studies, not as peer-reviewed results equivalent to the OECD and academic literature they sit beside. Readers should apply the discount that disclosure implies.

1. The efficiency critique: EPR is not the instrument theory recommends

The oldest and most technically serious objection is that EPR is a quantity mandate where a price instrument would do better.

The foundational work is Fullerton and Wolverton's case for a two-part instrument — a presumptive tax on output combined with a subsidy for clean or recycled behaviour — which they show can replicate a Pigovian tax on disposal under specified conditions, and which they extended in 2005 to a second-best world containing pre-existing distortionary taxation. This is the theoretical ancestor of the deposit-refund argument. It is important to be precise about what it is not: Fullerton and Wolverton were building the efficiency baseline, not attacking EPR, which largely postdates their framework as a named policy category.

The application to EPR comes principally from Resources for the Future. Palmer and Walls (1998) evaluated alternative product-responsibility policies and concluded that an upstream combined product tax and recycling subsidy is generally more cost-effective, and imposes fewer transaction costs, than the take-back approach. Calcott and Walls (published in Resource and Energy Economics, 2005) supplied the mechanism that matters most: design-for-environment incentives break down when recycling markets are incomplete, because the fee signal cannot reach the design decision if there is no functioning market on the other side of it. Walls (2011) states the general result about as directly as the literature does: "Theoretical models demonstrate that deposit-refunds outperform alternative approaches including virgin materials taxes, advance disposal fees, recycled content standards, and recycling subsidies."

Two cautions are necessary, and they cut against the critique's most aggressive users.

First, Walls's own most direct engagement with EPR as a policy category is considerably more agnostic than the summary above implies. In her 2003 RFF paper she writes that "the EPR concept itself... provides little guidance about which of these instruments might be appropriate under particular conditions," and rather than ranking instruments she develops design maxims. Her sharpest observation is about goal specification: EPR's stated objective, she notes, has widened from end-of-life impacts to life-cycle impacts generally, which makes it difficult to say what externality any given scheme is correcting. That is a more penetrating criticism than an efficiency ranking, and it survives every empirical dispute.

Second, the comparison set matters. Walls's 2011 result concerns deposit-refund against taxes, advance disposal fees, recycled-content standards and subsidies. It is not, as it is frequently paraphrased, a demonstration that deposit-refund beats collective EPR. "Economists agree that deposit-refund beats EPR" is a flattening of this literature, not a finding within it. The accurate statement is that the dominant strand of environmental economics ranks price instruments above quantity mandates, and that RFF economists have applied this to argue that collective EPR under-delivers design incentives where recycling markets are thin.

The strongest answer. Deposit-refund's theoretical elegance is proven mainly on beverage containers — a homogeneous, high-value, easily identified stream. Extending it to the full heterogeneity of packaging is not a solved problem, and the practical difficulties (unredeemed deposits, retailer logistics, limited scope) are real. Walls's own pragmatism is the best rebuttal to the maximalist version of her admirers' argument.

2. The design-signal critique: the mechanism does not do what it is advertised to do

This is the best-evidenced objection in the field, and the one that should be taken most seriously.

The OECD's work on modulated fees (Laubinger, Brown, Dubois and Börkey, Modulated Fees for Extended Producer Responsibility Schemes, OECD Environment Working Paper No. 184, 2021) states it plainly: "there is as of yet limited evidence that EPR schemes have triggered DfE" — design for environment — and identifies why: "in collective EPR schemes, the fee schedule set by Producer Responsibility Organisations is typically quite simple and provides weak incentives for design change."

The Netherlands Environmental Assessment Agency and the Netherlands Bureau for Economic Policy Analysis reached the same conclusion independently the same year (Dimitropoulos, Tijm and in 't Veld, Extended Producer Responsibility: Design, Functioning and Effects, PBL/CPB, July 2021): "There is little evidence to date of EPR instigating eco-design." For the signal to work, they note, "the fee charged for each product by PROs should reflect the social — i.e. the sum of private and external — costs of collection," which collective schemes do not achieve.

This matters more than any cost figure, because design change is the mechanism by which EPR was supposed to differ from a waste-management levy. If the fee does not reach the design decision, EPR is a financing instrument with a design-incentive story attached, and should be evaluated as a financing instrument. That is a substantially more modest claim than the one made for it in most legislative debate (Theme 5).

The strongest answer. Both reports treat this as an argument for better-designed EPR rather than against EPR. Granular modulation and individual producer responsibility are the identified fixes, and the same PBL/CPB report records that EPR does raise separate collection: "EPR has increased the share of end-of-life products being separately collected and treated." Its own summary judgement — "well-designed EPR is a useful ingredient of the policy mix... but no panacea" — is the most defensible position anyone has published.

3. The cost and incidence critique

The claim is that EPR functions as a regressive consumption tax whose costs reach households while its promised savings do not.

The most concrete empirical version comes from Lakhan (2026), The Stagnation Paradox, an SSRN working paper analysing Canadian programmes longitudinally. Its findings: British Columbia's programme expenses rose roughly 250% between 2014 and 2023 while material recovery remained statistically flat; Ontario's system costs nearly tripled over eighteen years while recovery regressed to 53.3%, close to the baseline of two decades earlier. Its explanation is the "evolving tonne" — a structural shift toward lightweight multi-laminate plastics that mechanical recycling cannot process regardless of fee design.

Three qualifications are required, and the first is the one this library's disclosure exists to make. This is the present author's own work, and it is a single-author SSRN working paper, not peer-reviewed. It sits in this section alongside OECD and RFF literature that has been through institutional or academic review, and it does not carry equivalent evidentiary weight. Second, the related cost figures circulating in American political debate — a $60.75-per-trip grocery basket increase, a 21.6% cumulative price effect — come from a commissioned study for the American Consumer Institute, an advocacy organisation, and concern plastic packaging substitution generally rather than EPR fees specifically. Conflating the cost of eliminating plastic packaging with the cost of EPR compliance is a category error, and it has been made repeatedly in downstream commentary. Third, when Patrick Gleason of Americans for Tax Reform wrote in July 2026 that EPR "raises the cost of most consumer goods, acting as a regressive tax hike that disproportionately harms low- and middle-income households," he was supplying political framing on top of those figures; the empirical claim and the framing have different authors and different standards of proof.

The most measured institutional version is the Tax Foundation's (Hoffer and Macumber-Rosin, 2024), which concedes the incidence point carefully — "price increases, particularly for manufactured goods, tend to have a particularly regressive effect, disproportionately burdening those with lower incomes" — while noting the cost is "not levied on consumers directly." Notably, the Tax Foundation is not opposed to producer-pays principles: it recommends "low-rate taxes on unrecycled raw materials like virgin plastics," which is the two-part instrument of Section 1, and it rejects recycled-content mandates and bans. It is a critic of how programmes are designed, not of the underlying principle.

The strongest answer. Producer fees substitute for costs that municipalities and their taxpayers already bore, so treating the fee as a wholly new cost double-counts. Whether the offsetting saving reaches households is an empirical question that has not been settled either way — which means the critique and its rebuttal currently share the same evidentiary gap (the savings analysis).

4. The accountability critique

The argument is that EPR delegates the power to set and collect binding charges to private bodies that no electorate controls.

In the United States this has become a live constitutional dispute rather than an academic one, and the litigation article treats it in full: due-process and private-delegation claims, tried in Oregon in July 2026 and undecided, plus parallel suits in Colorado and California. NAW's litigation director Karen Harned has said of the model, "This model, we think, is completely unconstitutional."

Two things must be said about the standing of this critique. It is a litigant's theory currently being tested, not an established holding — no court has ruled. And it is jurisdictionally specific: it depends on American constitutional doctrines that do not travel.

What is striking is what the search for a non-American version returned. No peer-reviewed academic work advancing a democratic-accountability critique of EPR in the European context could be located. European scholarly and regulatory attention to producer responsibility organisations runs almost entirely through competition law — market power, foreclosure, procurement — rather than through accountability. Given that Europe has operated producer-governed compliance bodies for three decades, and that Section 1's own literature notes EPR's goals are poorly specified, this absence is remarkable. The critique's strongest form is therefore currently available only in a forum designed to resolve constitutional questions in one country.

The strongest answer. Delegation to industry-funded intermediaries under agency supervision is common across regulatory domains and has not generally been held unlawful; the Supreme Court's reasoning in FCC v. Consumers' Research (2025) — that a private administrator is permissible where the agency retains final say — is the states' best authority. Whether the supervision is real is the factual question at the centre of the Oregon trial.

5. The performance critique

The claim is that EPR has not been shown to increase recycling, and that mature systems have plateaued.

The evidence base here is genuinely unsettled, and honesty requires saying so in both directions. The most concrete null-result claim is Lakhan's Canadian analysis discussed above, with the working-paper caveat already stated. The most cited contrary claim — The Recycling Partnership's 2023 study reporting that EPR "dramatically increases recycling rates" across seven jurisdictions — comes from an organisation substantially funded by consumer-goods and beverage companies, and its methodology was not verifiable for this article. A peer-reviewed 2022 assessment of European packaging EPR schemes exists and is indexed, but its findings could not be retrieved and are therefore not characterised here.

No independent systematic review or meta-analysis resolving the question in either direction was located. What the field has is a specific academic critic on one side, an industry-funded advocacy study on the other, and no neutral synthesis. That is the accurate state of play, and it is closer to the performance critique's position than to its opponents', because the burden of proof sits with the party asserting an effect (Theme 6).

The strongest answer. The defensible claim from the OECD and PBL/CPB work is narrower than "EPR achieves nothing": separate collection does rise. Critics sometimes slide from "EPR does not optimise the system" to "EPR does not work," and the second does not follow from the first.

6. The environmental critique: EPR solves the wrong problem

This objection comes from the opposite political direction and is routinely mistaken for the industry one. It is not.

Zero Waste Europe's February 2026 policy brief puts it starkly: "The EPR systems established to solve the waste problem have become a roadblock that stops progress towards better collection, reuse, and overall waste reduction." Its diagnosis is structural. EPR fees are calibrated as waste-management cost recovery, so the money flows to collection, sorting and recycling; reuse and repair remain uneconomic because nothing funds them. "The lack of funding for non-waste-related circular measures partly explains the limited progress on the EU's circularity achieved over the past decade." Meanwhile "waste streams such as packaging or WEEE have been growing at a faster pace than their collection and recycling rates" — the system is running to stand still.

Its proposed remedy is instructive, and it is why this critique cannot be enlisted by EPR's industry opponents: Zero Waste Europe wants PRO budgets split, with a defined minimum share — it proposes 10%, pending better cost data — ring-fenced for a transition fund covering reuse, repair, refurbishment and remanufacture. That is a demand for more producer obligation, more prescriptively directed. The environmental critique of EPR is a critique of its end-of-pipe logic, not of producer responsibility (the waste hierarchy article).

The strongest answer. This is a design fix compatible with EPR rather than a reason to abandon it — as Zero Waste Europe's own remedy concedes. And recycling improvement, while an incomplete goal, is measurable and near-term in a way that reuse targets have so far not proved to be (the reuse evidence).

7. A note on who is not in this argument

One finding from assembling this article is worth recording because it contradicts a widespread assumption. American free-market think tanks have largely not engaged with packaging EPR. Targeted searches of the Competitive Enterprise Institute, the Cato Institute, the Property and Environment Research Center and the Manhattan Institute returned no publications on the topic. The one clear hit is the Reason Foundation's 2002 policy study by Joel Schwartz and Dana Joel Gattuso, which argued that EPR fee-setting "is generally a political, rather than a scientific or economic exercise" and preferred voluntary industrial-ecology approaches — but that paper predates the entire modern American EPR wave by nearly two decades and cannot bear the weight of current commentary.

The correct statement is that no publications were found in the searches conducted, not that these organisations have no position. But the pattern is suggestive: the active opposition is not the classic free-market institutions. It is state business councils, sector trade associations, tax-policy organisations, industry-aligned consumer groups, and — decisively — litigants. That tells you something about the nature of the opposition that a survey of think-tank output would miss entirely.

8. Where the argument stands

The strongest case against packaging EPR is not the one usually made. It is not that EPR is expensive, and it is not that it is unconstitutional. It is a narrower and better-supported claim assembled from the OECD, PBL/CPB and RFF literatures: that EPR's central mechanism — the fee signal reaching the design decision — is not demonstrated to operate in collective schemes; that its goals are specified too loosely to say what externality it corrects; that its effect on total system cost is unknown; and that the instrument theory recommends for the problem is a different one.

Every element of that is drawn from institutional or peer-reviewed sources, none of it depends on contested cost figures, and none of it is answered by pointing to rising collection rates. It is also, notably, an argument for redesign rather than repeal — which is where the industry critique and the environmental critique, from opposite directions, unexpectedly converge.

References

  • Efficiency: Fullerton, D. and Wolverton, A. (1997), The Case for a Two-Part Instrument, NBER Working Paper 5993, and (2005) "The Two-Part Instrument in a Second-Best World," Journal of Public Economics; Palmer, K. and Walls, M. (1998), Extended Product Responsibility: An Economic Assessment of Alternative Policies, Resources for the Future; Walls, M. (2003), The Role of Economics in Extended Producer Responsibility, RFF, quoted directly; Walls, M. (2011), Deposit-Refund Systems in Practice and Theory, RFF, quoted directly; Calcott, P. and Walls, M. (2005), "Waste, Recycling, and 'Design for Environment'," Resource and Energy Economics 27(4): 287–305 — bibliographic record verified, text not read, and no quotation is attributed to it here; Dinan, T. (1993), Journal of Environmental Economics and Management — existence verified, findings not retrieved and therefore not characterised.
  • Design signal: Laubinger, F., Brown, A., Dubois, M. and Börkey, P. (2021), Modulated Fees for Extended Producer Responsibility Schemes, OECD Environment Working Paper No. 184, quoted directly; Dimitropoulos, A., Tijm, J. and in 't Veld, D. (2021), Extended Producer Responsibility: Design, Functioning and Effects, PBL/CPB, quoted directly.
  • Cost and incidence: Lakhan, C. (2026), The Stagnation Paradox: A Longitudinal Analysis of Structural Limitations in Canadian Extended Producer Responsibility Programs, SSRN working paper (January 2026) — the present author's work; not peer-reviewed; American Consumer Institute, Material Substitution Costing Analysis (April 2026), conducted by the same author — a commissioned study for an advocacy organisation, concerning plastic substitution rather than EPR fees; Hoffer, A. and Macumber-Rosin, J. (2024), Extended Producer Responsibility, Tax Foundation Fiscal Fact No. 849, quoted directly; Gleason, P., RealClearMarkets (2 July 2026) — an opinion piece by an officer of Americans for Tax Reform, downstream of the figures above; Business Council of New York State, cost estimate for the New York bill — an association-commissioned figure; the state's own fiscal estimate was not located, so no comparison is asserted.
  • Accountability: the US litigation, treated in full with sources in the litigation article; FCC v. Consumers' Research, 606 U.S. (2025). No peer-reviewed European accountability critique of EPR was located.
  • Performance: Lakhan (2026), as above; The Recycling Partnership (2023) study reporting cross-jurisdictional recycling gains — an advocacy organisation funded substantially by consumer-goods and beverage companies; its methodology was not verified for this article; a 2022 peer-reviewed assessment of European packaging EPR schemes is indexed but its content could not be retrieved and no finding is attributed to it.
  • Environmental critique: Zero Waste Europe (February 2026), Extended Producer Responsibility for Waste Reduction, quoted directly. Positions of GAIA, Break Free From Plastic and Reloop on packaging EPR specifically were not verified and are therefore not characterised here.
  • Think tanks: Schwartz, J. and Gattuso, D. J. (2002), Extended Producer Responsibility: Reexamining Its Role in Environmental Progress, Reason Foundation. Searches of the Competitive Enterprise Institute, Cato Institute, Property and Environment Research Center and Manhattan Institute returned no publications on packaging EPR; this is recorded as "not found in the searches conducted," not as an absence of any position.

Verification note: this article deliberately states the review status and funding source of every empirical claim, because the critical literature on EPR is unusually mixed in provenance and the distinction between peer-reviewed research, institutional analysis, commissioned study and advocacy determines how much weight each claim can bear. Where a source's findings could not be retrieved, no finding is attributed to it. See Sources and method.