Addressing the Lemons Problem in Environmental Sustainability:Greenwashing and E-Waste Challenges in African Markets

Mohit Chaudhary1

1

Publication Date: 2024/10/02

Abstract: The "lemons problem," as conceptualized by Akerlof in 1970, depicts the adverse effects of information asymmetry in markets wherein sellers are more informed than buyers, consequently causing the leakage of low-quality commodities. This paper explains how this phenomenon plays out in an environmental sense more specifically, through the disguise of greenwashing and e-waste overflowing into African nations. False claims of sustainability by company’s dupe customers and lead to environmental degradation. The agriculture and energysectors are put under the scanner, showing the damage done by monoculture practices and the fraudulent promotion of genetically modified organisms. The importation of electronic waste and used vehicles into Africa serves to underscore the serious health and environmental implications of such exploitation. To answer this, there is the need to first introduce the EPR model where the responsibility of dealing with waste management will be passed to the producers who will be forced to be responsible and sustainable.

Keywords: Lemons Problem, Information Asymmetry, Extended Producer Responsibility (EPR), Ecological Impact.

DOI: https://doi.org/10.38124/ijisrt/IJISRT24SEP1244

PDF: https://ijirst.demo4.arinfotech.co/assets/upload/files/IJISRT24SEP1244.pdf

REFERENCES

  1. Akerlof, G. (1995). The Market for “Lemons”: Quality Uncertainty and the Market Mechanism. In: Estrin, S., Marin, A. (eds) Essential Readings in Economics. Palgrave, London. https://doi.org/10.1007/978-1-349-24002-9_9
  2. Altieri, M. A. (1999). The ecological role of biodiversity in agroecosystems. Agriculture Ecosystems & Environment, 74(1–3), 19–31. https://doi.org/10.1016/s0167-8809(99)00028-6
  3. Delmas, M. A., & Burbano, V. C. (2011). The Drivers of Greenwashing. California Management Review, 54(1), 64-87. https://doi.org/10.1525/cmr.2011.54.1.64
  4. Wu, Y., Zhang, K., & Xie, J. (2020). Bad greenwashing, good greenwashing: corporate social responsibility and information transparency. Management Science, 66(7), 3095–3112. https://doi.org/10.1287/mnsc.2019.3340
  5. Maes, T., & Preston-Whyte, F. (2022). E-waste it wisely: lessons from Africa. Sn Applied Sciences, 4. https://doi.org/10.1007/s42452-022-04962-9
  6. Niinimäki, K., Peters, G., Dahlbo, H., Perry, P., Rissanen, T., & Gwilt, A. (2020). The environmental price of fast fashion. Nature Reviews Earth & Environment, 1, 189 - 200. https://doi.org/10.1038/s43017-020-0039-9
  7. Tilman, D., Cassman, K., Matson, P. et al. Agricultural sustainability and intensive production practices. Nature 418, 671–677 (2002). https://doi.org/10.1038/nature01014
  8. HAINMUELLER, J., & HISCOX, M. J. (2010). Attitudes toward Highly Skilled and Low- skilled Immigration: Evidence from a Survey Experiment. The American Political Science Review, 104(1), 61–84. http://www.jstor.org/stable/27798540
  9. Tietenberg, T., & Lewis, L. (2018). Environmental and Natural Resource Economics (11th ed.). Routledge. https://doi.org/10.4324/9781315208343
  10. Economy, P. F. a. T. C. (2019). A new circular vision for electronics: Time for a global reboot. https://wedocs.unep.org/handle/20.500.11822/32762?show=full
  11. U.S. Environmental Protection Agency (EPA). (2020). The Environmental Protection Agency’s E-Waste Management Guide.
  12. Bazan, G. (1997). Our Ecological Footprint: Reducing Human Impact on the Earth. https://doi.org/10.5070/g31710273
  13. Darnall, Nicole and Sides, Stephen, Assessing the Performance of Voluntary Environmental Programs: Does Certification Matter?. Policy Studies Journal, Vol. 36, No. 1, 2008, Available at SSRN: https://ssrn.com/abstract=1030622
  14. Hart, S. L., & Milstein, M. B. (2003). Creating sustainable value. Academy of Management Perspectives, 17(2), 56–67. https://doi.org/10.5465/ame.2003.10025194
  15. Maes, T., Preston-Whyte, F. E-waste it wisely: lessons from Africa. SN Appl. Sci. 4, 72 (2022). https://doi.org/10.1007/s42452-022-04962-9