INTRO It is well known that there are very few places still unmodified by man around the world. Nowadays, anyone can notice the impacts of human activity on any landscape, especially the increasing pollution of plastic bags in urban and rural areas. Australia, South Africa, United States, Great Britain and others are amongst the leading world countries which address this increasingly relevant issue. For instance, in South Africa the pollution made by plastic bags is of such extent that they have ironically named it their national flower. And in Ireland a tax called `PlasTax' was set to reduce the consumption of plastic bags. According to a study by the Centre for Marine Conservation, plastic bags are among the 12 items of debris most often found in coastal cleanups. Other studies were made in Chile, USA and New Zealand , showing the increased global concern on the plastic bags issue. Thus, it is time to think of ways which would help to create an efficient system of allocation of resources. This extended essay intends to address this problem by calculating the costs of the plastic bags on society and by showing a solution to reach appropriate levels of production of plastic bags in Argentina. I expect to provide a simple contribution to this issue with the use of the tools that I can apprehend. Therefore, a research question has aroused that leads us to investigate on the market failure of plastic bags: To what extent is the market of plastic bags in Argentina failing to allocate resources efficiently and how should the government overcome the market failure? To answer this question an economic treatment has been given to the problem, in order to measure the plastic bags' impact on society and the environment. This extended essay will be oriented towards the topic of market failure to address the issue as the market of plastic bags is not working efficiently. This is because the total output of plastic bags is exchanged in the market at a price which is not considering what is economically best for society. In this way, the price should be changed in order to reflect one which incorporates the social costs and benefits to society of plastic bags. In order to determine the price, I will perform an investigation to identify the costs and benefits related to the use of plastic bags. With the use of primary research and of data available on the World Wide Web and from economic books, I will produce an estimation of the socially desired price and quantity of plastic bags. The analysis will have to gather quantitative as well as qualitative data which will have to be quantifiable and measurable for the purpose of this work. In this sense, the opinion of the society will need to be included in the evaluation as the appraisal of society respect to the plastic bags has to be considered in the calculations. Furthermore, as the government is considered as a necessary agent to correct the failure of markets, I will, through the use of primary research, suggest a form of government intervention and reflect the effects of these on the market after achieving the estimation for the price of the plastic bags Chapter 1 THEORETICAL FRAMEWORK SJ Grant considers that market failure occurs when free markets do not work efficiently in the process of allocating resources. This is because the market system was not capable of producing the products people want, in the quantities they want and at prices which reflects their marginal utilities.. Externalities occur when a 3rd party is affected by the action or decisions of others. This means that there is spillover effect over society from an economic activity which is in this case the production of plastic bags. Externalities arise when the social benefits or costs of an economic activity are different from the benefits or costs of private individuals. For instance, if the social costs are smaller than the private costs or the social benefits are bigger than the private benefits, then a positive externality has been created. 1

In this sense, the quantity of plastic bags that will be produced will have to be decided at a level in which the social costs equals the social benefits as the value that society places on the last unit produced will be equal to the full cost of producing that last unit. This would then mean that there will be a socially efficient level of production or socially efficient output for the plastic bags when resources are efficiently allocated. The issue arises when trying to apply externalities to the market system. Supply and demand curves show what consumers and producers want and are capable of in that market. This system is not used to show the spillover effects on to third parties due to the rational of consumers and producers. This is because the producers are only expecting to pay for the costs of production and not for the social costs and the consumers are trying to obtain the best value for their money and therefore are not willing to pay for the social costs. The following graph illustrates the point: However, Figure 1 is hypothetically showing what happens when negative externalities are present as social costs are greater than private costs and social benefits are lower than private benefits. For this reason the market equilibrium price is below the price established by society as P and SEO which are the price and quantity equilibrium for the social benefits (SB) and social costs (SC) curves are different from P1 and Q1 which are the quantity and price equilibrium for the private costs (PC) and private benefits curve (PB). In this way the market equilibrium price is below the price established by society as it decreased from P to P1 and the level of production is much higher as it increased from SEO to Q1 and this difference is the market failure in the plastic bags market. On the other hand, if the private costs and benefits curves were to show the real costs and benefits to society then the curves would shift accordingly to the correct output and price by internalizing the externality. If we are to achieve a socially efficient output for the plastic bags, the quantity produced should reflect a level in which the social benefits equal the social costs and the price is decided by the interaction of the two curves. Achieving the socially efficient output is very difficult. This essay will intend to measure the value of the externalities in the market of plastic bags and choose a possible solution for this problem. This would certainly be done by driving the price of the plastic bags from P1 to P, which will correct the oversupply of this good in the Argentina, nearing the output to a more socially efficient one. The difficulty relies in measuring all the plastic bags' benefits and costs. These are nearly impossible to calculate accurately. However, a percentage may still be valued. This is because as externalities have no price attached to them, economists usually measure them through their opportunity cost. This is called attaching a shadow price to the cost. DEFINITION OF PLASTIC BAG A plastic bag is defined as a product based on petroleum derivatives which are used to carry items from a store to a home. Generally of single use, carrier bags may be also reused at home for storage. Consumption of this good in Argentina is calculated to be annually of two thousand million bags and its average market price is of $0,03 . Another important issue is that we will assume that the good's nearest substitute are the oxi−biodegradable plastic bags which have a price of $0.25 each. Oxi−biodegradable means that the bags need at least oxygen to degrade and are not completely dependent of biologically active environments for their disintegration. They decompose within a prefixed time lapse decided by the fabricant which ranges from a few weeks to eighteen months and are produced through the same process as the common plastic bags and using the same amount of raw materials and energy. The difference relies in a small chemical additive which transforms the plastic into an oxi−biodegradable material. THE SURVEY To answer the question posed in this work it is necessary to measure and treat the external costs of plastic 2

bags in Argentina. To achieve this a survey was conducted. The sample of the population was selected at random and surveyed with questions related to the topic. The sample totaled one hundred people and it was conducted in Buenos Aires to people aging from 17 to 67 years. Chapter 2 In this chapter I will try to estimate the value of the externalities derived from the production and consumption of plastic carrier bags. For this I will firstly list and describe the most significant externalities and, in the second part I will proceed to value them. EXTERNAL COSTS DERIVED FROM THE PLASTIC BAGS MARKET In the first place, the raw materials used to manufacture this good have their own cost. The bags are made from processed hydrocarbons which account for the usage of almost 1% of Argentina's oil consumption. The transport of this good also results in the emission of greenhouse gases and this, in turn, creates a spillover effect to third parties. Secondly, the disposal of plastic bags creates another expense for society which has to pay for the treatment of this new garbage. Although there are three main methods of waste disposal in Argentina the most common waste treatment method is the landfill. This type of cost is related with the recollection, disposal and finally, treatment of the garbage which are all private costs of the garbage recollecting activity. On the other hand, there are various types of costs related to the third parties which result affected by the landfills. Visual and air pollution related to the recollection and treatment of the garbage also conform a considerable externality. Some of the costs which have a direct impact on the environment are more complex to calculate. One of them is the impact to marine life as some species normally mistake the plastic in the ocean for food. This is because plastics are not biodegradable, or at least not in 500 years, but otherwise, they divide into smaller pieces called pellets which are later eaten by animals, killing them in the end. A study on the Spanish, French and Italian ocean coasts revealed that of 77% of the debris found on the seafloor, 92.8% were plastic bags. As a consequence, human lives are affected by this problem when plastic is eaten by animals as it enters the food chain. In this way we end up eating the minuscule plastic particles in the fish, which increase the risk of cancer. In addition, the plastic bag pollution of the environment results in the increase of floods in cities by blocking the drainage systems, thus adding to the cost the damage produced. Moreover, plastic bags generally reach the countryside and, besides creating visual pollution, they end up killing wild animals which mistake them for food. Conversely, there are positive externalities related to the use of plastic bags. They are very likely to be reused, for example, as bags for the trash bins and others such as storage. A study in Australia estimated that approximately 60% of the bags are used a second time before being thrown into the litter stream and this percentage will be considered the same for Argentina. EXTERNAL COSTS ESTIMATION For this part of the essay it will be important to separate the costs which can be measured and those which are not measurable. The latter are those qualitative costs that rely on the subjective value that society applies to that externality. They do not provide factual evidence of the monetary value but are merely value judgments from third parties. This is very important as it may be nearly impossible to estimate the monetary impact of plastic bags on environmental problems such as floods, contamination of the food chain and death of wild animals. This is due to the reason that it is very difficult to estimate the cost of damaging the environment and because there aren't any studies which provide accurate data about its impact in Argentina. The cost of the waste generated by the plastic bags is quantifiable. Different data has been selected from 3

reports and studies which show information about the treatment of rubbish. In this way a certain value can be deduced from the overall expenditure of trash treatment. The city of Buenos Aires spends about 400 million pesos annually to take care of all of the city's garbage. If the city has about three million people living in it, then this cost would be of about $133 per year per person. According to a study, the percentage of plastic bags volumetric weight over the total garbage's volumetric weight is of about 1,9% so it is not incorrect to translate at least 2% of the litter clean up costs to the price of bags. Thus, the fee correspondent to the plastic bags is of about $2,66 per person. It is important to underline that this study was made specifically for the biggest city in Argentina. However, for the purpose of this study we will assume that this price is applicable for all the population in Argentina. In effect, every person in Argentina is paying $2,66 per year for the cleanup of the litter caused by plastic bags. This calculation does not mean that all of the costs related with plastic bags litter are covered, as there are some costs that are not directly considered such as the visual and air pollution caused. On the other hand, this price did not directly measure the price of the costs but the value of the shadow prices. For this reason we will assume that, for example, the contribution to greenhouse gases is considered to be included in the market price for oil and thus, the impact of this externality is measured indirectly through the price. Adding up, the cost of plastic bags litter in the environment is of $0,053 or 5,3 cents per bag annually. The monetary value of emitting carbon dioxide into the air can be projected by applying a shadow price such as the price of the hydrocarbons used to produce these bags. Approximately, 12 million barrels of oil produce 100 billion shopping bags. The internal price per barrel of oil in Argentina is of $140. This would mean an average opportunity cost per bag of around $0,017 as the market price of oil is, in theory, adopting the costs of the emission of carbon dioxide into the air when the petrol is consumed. The positive side of plastic bags is their reusability and if there is a 60 percent of reuse in plastic bags, this would mean a saving of $0.018 per bag. Resuming the analysis up to the point, the measurable costs and benefits of the plastic bag adjust the market price of the plastic bag by $0, 052. The following table is a summary of the quantitative costs: cost of trash cost of emitting carbon dioxide benefit of reusability Sum of quantitative costs

$0,053 $0,017 ($0.018) $0,052

The qualitative costs were valued through the analysis of the primary research. People were asked to answer how much extra money were they willing to pay annually for using only oxi−biodegradable bags. This is because we assume these bags, due to their inherent properties, don't create medium−term visual pollution, dissolve in the ocean and in the countryside and don't contribute with floods. So it would not be incorrect to assume that they are internalizing the externalities which are not measurable. How much are you willing to pay annually for oxi−biodegradable plastic bags? As we can observe in Fig. 9, the results were really positive. 47% of the respondents were willing to pay more than $50 per year and 74% were willing to pay up to $50 per year. In effect this would be the social value on those externalities which were not measurable. Note that this monetary value is absolutely subjective to the opinion of consumers being affected by the plastic bags. In nominal terms, the vast majority of population is willing to pay $1 per bag annually to compensate for the damage that the plastic bags are doing to society. Furthermore, this is a $37.5 additional to the quantity they would have to pay if they annually used 50 oxi−biodegradable bags which have a cost of $0.25 each. This is because we assume that society is willing to pay $50 to internalize the costs. 4

At this point we have gathered enough information to measure the negative externalities of a plastic bag with a certain level of accuracy. The failure in the market of plastic bags in Argentina is exemplified in Figure 10: Pd and Qd reflect the current market situation of the plastic bags with an annual quantity demanded of two thousand million bags at $0,03. These are a reflection of the interaction of the PC (private costs) curve and the D (demand) curve. Note that the D curve cuts the price axis at P1 which is equal to the price of oxi−biodegradable bags. At this point the quantity demanded will be Q1 which reflects no demand at all, because in theory, consumers have moved to purchase the substitute of plastic bags. Qx, which is the socially efficient level of output, Qx, is not known in exact terms but it is logically smaller than Qd as the plastic bags are being overproduced and this is causing the market failure. As the interaction between the SC and D curves is showing, if the externalities were to be internalized, the demand and social costs curves would not be at equilibrium unless the output is negative, which is absolutely impossible. In this way, the market should be socially inoperable and third parties would benefit from a closure of this market. CHAPTER 3 In this chapter we will deal with the way that the government should intervene to correct the failure in the market of plastic bags and adjust the current output to a level in which the full costs of producing and using a plastic bag is reflected. By doing so, the market should internalize the externality and allocate efficiently the resources. Results of Primary Research Should the government intervene? How should the government intervene to solve this situation? As primary research shows, 81% of the people surveyed responded that the government should intervene and, between a tax, a total ban and `other' options, 65% replied that a tax was the best option to consider. GOVERNMENT INTERVENTION As we previously showed, the plastic bags are overproduced as the costs carried on to third parties are not considered by the ones involved in the production of the good. In this case some economists argue that responsibility of treating the market failure lays on the government. The size of the effects created by a tax will vary with the elasticity of the product. Taxes also vary in types as there are specific or ad valorem taxes. Specific taxes are fixed−sum taxes which do not change the price of the product. An ad valorem tax on the other hand is a percentage tax on the price of the product and therefore will increase with the price of the product. Due to its simplicity, the tax that should be applied to the plastic bags market is an indirect tax which are taxes placed on goods and services. It has the same effect as increasing the costs of production by the amount of the tax. As it was already shown before, the optimum level of production of the plastic bags is at that quantity which equals the price of the oxi−biodegradable plastic bags as these internalize most of the negative externalities. Theoretically, the effects of applying a tax in the plastic bags market would be an increase in the market price, a decrease in the quantity produced and consumed by the market and an increase in revenue for the government. Figure 13 theoretically illustrates how the tax would work in the shopping bags market. Actual output and price are shown at P and Qd where the S (supply) and D curves meet at equilibrium. A new tax would shift the supply curve parallel to the left and as a consequence increase the price of the good from P to Px and 5

decrease the output from Qd to Qx as a consequence of a new equilibrium between the curves of supply and demand. Furthermore, to correct the market failure it is necessary to apply a tax equal to the cost of the externalities. However, a tax of this magnitude would in theory bring no equilibrium to the market as the supply curve will never meet the demand curve. Therefore the tax should equal the difference in price between the actual market price for bags and the market price for oxi−biodegradable bags. This tax would be of $0,022 per plastic bag and its effects will be the replacement of plastic bags with oxi−biodegradable bags and a 100% reduction in the consumption of shopping bags. In this way the market is said to have reached the socially efficient level of output at which the social costs are equal to the social benefits and the private costs are equal to the private benefits. CONCLUSION The main objective of this essay was to identify and value the different external costs associated to the market of plastic bags and then propose a resolution to this scenario. The analysis proved that there was a market failure in which resources were not being efficiently utilized. We also found out that externalities were certainly complicated to assess as they were based on subjective matters that relied on the judgmental value that society places on certain externalities. On the other hand, this lack of accuracy was overcome by the existence of a close substitute. In the first part we discovered that the failure was such that the market was operating completely inefficiently as the externalities were of $1, 052 and the price of the plastic bags were of $0, 03. Moreover, the socially efficient output for the market was not quantified, but we could estimate that the market was failing to allocate resources efficiently as the socially efficient level of production was negative. In this way, we realized that if we internalized the externalities there would be no economic market for this product. In the second part we discovered that society preferred to fix this inefficiency through the use of an indirect tax. In theory the tax should disincentive the use of bags and, as a consequence, reduce their negative impact on society. However, this would occur if everything remains ceteris paribus. Fact is, in real life there are lots of factors and variables which would affect a tax's effect on plastic bags consumption Further investigation related to this subject could try to measure the probable effectiveness, in real terms, of a tax on plastic bags or what would be the cost of implementing the tax to the plastics industry. Ideally the tax should be accompanied with a set of other government measures to discourage the use of shopping bags such as an advertising campaign to change the consumer behavior. APPENDIX 1. 400 m pesos / 3 m people in Cap. Federal = $133 per person 2. $133 * 0.02 (percentage) = $2,66 3. 2.000 m bags / 40 m people = 50 bags per person $2,66 / 50 = $0,053 per bag 4. 12 m barrels = 100 000 m bags 12m/50 = 100 000 m /50 240 000 barrels = 2 000 m bags 240 000 barrels * $140 (price per barrel) =$33 600 000

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$33 600 000 / 2 000 m (bags) = $0.17 (2 significant figures) 5. $0.03 * 0.06 (percentage) = $0.018 per bag 6. $50 / 50 bags per year = $1 per bag 7. $50 − (0,25(price of oxi−biodegradable bag) * 50) = $37.5 8. $0.25 − $0.03 = $0.22 BIBLIOGRAPHY Grant, S.J., Stanlake's Introductory Economics 7th Edition. Edinburgh: Pearson Education Ltd., 2000 Web Sites South Africa bans plastic bags. BBC. 5/06/08. BBC News. 9 May 2003 http://news.bbc.co.uk/2/hi/africa/3013419.stm Plastic−Bag Bans Gaining Momentum Around the World. National Geographic News. 16/06/08. John Roach. 4 April 2008. http://news.nationalgeographic.com/news/2008/04/080404−plastic−bags.html Estudio de Ciclo de Vida de 12 Envases y Embalajes. Gobierno de Chile. 28/04/08. Comision Nacional del Medio Ambiente. June 2001. http://www.p2pays.org/ref/18/17615.pdf Review of Plastic vs. Paper Bag LCA Studies. The ULS Report. 20/05/08. Robert Lilienfeld. 1 June 2007. www.deq.state.mi.us/documents/deq−ess−p2−recycling−PaperPlasticSummary_2.pdf − Facts and figures regarding the true cost of plastic bags. Reusablebags.com. 20/05/08. Vincent Cobb. N/A. http://reusablebags.com/facts.php Plastics in Education. Plastics New Zealand Incorporated. 18/05/08. Plastics New Zealand. 2003. http://www.plastics.org.nz/page.asp?id=587 Plastic shopping bag." Wikipedia, The Free Encyclopedia. 12 May 2008 . Wikimedia Foundation, Inc. 13 Aug 2008 http://en.wikipedia.org/w/index.php?title=Plastic_shopping_bag&oldid=231432810 COMO FUNCIONA. RES Argentina. 18/05/08. Res Argentina. N/A. http://www.degradable.com.ar/default_4.html Mendoza y los plásticos degradables. RES Brasil. 18/05/08. Roberto Blanco. 06 Nov 2006. http://www.resbrasil.com.br/default.asp?i=10&a=0&c=509 Bolsas Plásticas. Inocentes Condenadas. Camara Argentina de la Industria Plastica (CAIP). 15/05/08. Oscar E. Sánchez. 15 Oct 2007. http://www.caip.org.ar/pdf_general/bolsas_plasticas_inocentes_condenadas.pdf Marine Debris in Canada. The Green Lane. 7/06/08. The Green Lane. 25 Feb 2003. http://www.ec.gc.ca/marine/debris/eng/facts.htm "Plastic shopping bag." Wikipedia, The Free Encyclopedia. 12 May 2008. Wikimedia Foundation, Inc. 13 Aug 2008 http://en.wikipedia.org/w/index.php?title=Plastic_shopping_bag&oldid=231432810

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Bring Your Own Bag. Planet Green. 17/06/08. Jasmin Malik Chua 23 Mar 2008 http://planetgreen.discovery.com/home−garden/bring−your−own−bag.html Propuestas de los candidatos porteños. LA NACION.com. 17/06/08 José Ignacio Lladós. 20 May 2007. http://www.lanacion.com.ar/nota.asp?nota_id=910191 "Buenos Aires." Wikipedia, The Free Encyclopedia. 04 Jun 2008. Wikimedia Foundation, Inc. 13 Aug 2008 http://en.wikipedia.org/w/index.php?title=Buenos_Aires&oldid=231481264 Estudio de Calidad de los Residuos Solidos de la Ciudad de Buenos Aires. Facultad de IngenierÃ-a de la Universidad de Buenos Aires. 18/05/08. Instituto de Ingenieria Sanitaria. 2005/2006. http://www.ceamse.gov.ar/dispo−final/estudio−residuos−urb.zip The NumbersBelieve It or Not. Reusablebags.com. 20/05/08. Vincent Cobb. N/A. http://www.reusablebags.com/facts.php?id=4 Suben el precio interno del barril de petroleo. Tucumannoticias.com. 2/08/08. Tucuman Noticias. 20 Jul 2008. http://www.tucumanoticias.com.ar/noticia.asp?id=14764 COTIZACIONES MERCADO ÚNICO Y LIBRE DE CAMBIOS. Dolarhoy.com. 19/05/08. Dolarhoy.com 19 May 2008. http://www.dolarhoy.com/indexx.php Quieren que los supermercados dejen de entregar bolsas de plástico. Pilar de Todos. 18/05/08. pilardetodos.com.ar. 22 Jun 2007. http://www.pilardetodos.com.ar/20070623/bolsapapel.html

Anuario estadÃ-stico de América Latina y el Caribe, 2007. CEPAL.17/06/08. CEPAL. Mar 2008. http://www.eclac.org/cgi−bin/getProd.asp?xml=/publicaciones/xml/8/32598/P32598.xml&xsl=/deype/tpl/p9f.xsl&base PLASTIC BAGS. Plastics and Chemicals Industries Association (PACIA). 28/04/08. PACIA Recycling. N/A. http://www.pacia.org.au/index.cfm?menuaction=mem&mmid=009&mid=009.002 South Africa bans plastic bags. BBC. 5/06/08. BBC News. 9 May 2003 http://news.bbc.co.uk/2/hi/africa/3013419.stm Plastic−Bag Bans Gaining Momentum Around the World. National Geographic News. 16/06/08. John Roach. 4 April 2008. http://news.nationalgeographic.com/news/2008/04/080404−plastic−bags.html Facts and figures regarding the true cost of plastic bags. Reusablebags.com. 20/05/08. Vincent Cobb. N/A. http://reusablebags.com/facts.php Estudio de Ciclo de Vida de 12 Envases y Embalajes. Gobierno de Chile. 28/04/08. Comision Nacional del Medio Ambiente. June 2001. http://www.p2pays.org/ref/18/17615.pdf Review of Plastic vs. Paper Bag LCA Studies. The ULS Report. 20/05/08. Robert Lilienfeld. 1 June 2007. www.deq.state.mi.us/documents/deq−ess−p2−recycling−PaperPlasticSummary_2.pdf − Plastics in Education. Plastics New Zealand Incorporated. 18/05/08. Plastics New Zealand. 2003. http://www.plastics.org.nz/page.asp?id=587 Grant, S.J., Stanlake's Introductory Economics 7th Edition. Edinburgh: Pearson Education Ltd., 2000 8

Ibid. Ibid. Plastic shopping bag." Wikipedia, The Free Encyclopedia. 12 May 2008 . Wikimedia Foundation, Inc. 13 Aug 2008 http://en.wikipedia.org/w/index.php?title=Plastic_shopping_bag&oldid=231432810 Mendoza y los plásticos degradables. RES Brasil. 18/05/08. Roberto Blanco. 06 Nov 2006. http://www.resbrasil.com.br/default.asp?i=10&a=0&c=509 The peso or nuevo peso Argentino is the currency of Argentina. The symbol used for it is $ and it floats under a managed exchange rate around $3 per dollar. COTIZACIONES MERCADO ÚNICO Y LIBRE DE CAMBIOS. Dolarhoy.com. 19/05/08. Dolarhoy.com 19 May 2008. http://www.dolarhoy.com/indexx.php This quote was provided by a plastic bags producer through a telephone inquiry (08/06/08). This quote was provided by a plastic bags producer through a telephone inquiry. (08/06/08). COMO FUNCIONA. RES Argentina. 18/05/08. Res Argentina. N/A. http://www.degradable.com.ar/default_4.html Bolsas Plásticas. Inocentes Condenadas. Camara Argentina de la Industria Plastica (CAIP). 15/05/08. Oscar E. Sánchez. 15 Oct 2007. http://www.caip.org.ar/pdf_general/bolsas_plasticas_inocentes_condenadas.pdf Marine Debris in Canada. The Green Lane. 7/06/08. The Green Lane. 25 Feb 2003. http://www.ec.gc.ca/marine/debris/eng/facts.htm "Plastic shopping bag." Wikipedia, The Free Encyclopedia. 12 May 2008. Wikimedia Foundation, Inc. 13 Aug 2008 http://en.wikipedia.org/w/index.php?title=Plastic_shopping_bag&oldid=231432810 Bring Your Own Bag. Planet Green. 17/06/08. Jasmin Malik Chua 23 Mar 2008 http://planetgreen.discovery.com/home−garden/bring−your−own−bag.html Propuestas de los candidatos porteños. LA NACION.com. 17/06/08 José Ignacio Lladós. 20 May 2007. http://www.lanacion.com.ar/nota.asp?nota_id=910191 "Buenos Aires." Wikipedia, The Free Encyclopedia. 04 Jun 2008. Wikimedia Foundation, Inc. 13 Aug 2008 http://en.wikipedia.org/w/index.php?title=Buenos_Aires&oldid=231481264 See APPENDIX 1. Estudio de Calidad de los Residuos Solidos de la Ciudad de Buenos Aires. Facultad de IngenierÃ-a de la Universidad de Buenos Aires. 18/05/08. Instituto de Ingenieria Sanitaria. 2005/2006. http://www.ceamse.gov.ar/dispo−final/estudio−residuos−urb.zip See APPENDIX 2. See APPENDIX 3. The NumbersBelieve It or Not. Reusablebags.com. 20/05/08. Vincent Cobb. N/A. 9

http://www.reusablebags.com/facts.php?id=4 Suben el precio interno del barril de petroleo. Tucumannoticias.com. 2/08/08. Tucuman Noticias. 20 Jul 2008. http://www.tucumanoticias.com.ar/noticia.asp?id=14764 See APPENDIX 4. See APPENDIX 5. See APPENDIX 6. See APPENDIX 7. Grant, S.J., Stanlake's Introductory Economics 7th Edition. Edinburgh: Pearson Education Ltd., 2000 Ibid Ibid. See APPENDIX 8. Ceteris paribus: all other things being equal. This means that all other variables remain unchanged for the purpose of the economic analysis. 4 SEO Q1 Quantity Costs and benefits SC SB P PC PB P1 Figure 1 Market failure Figure 2

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Figure 3 SC Market Failure Px: $1,052 P1: $0,25 Pd: $0,03 Price($) Qx Q1: 0 Qd: 2000 Quantity(m) Figure 4 PC D (PB = SB) Figure 5 Figure 6 TAX = mk failure Qd:2000 Quantity (m) Price ($) S S1 P= $0,03 D Px Figure 7

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Qx Q2: 0 P1: $0,25

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