I remember studying bottle redemption regulations for an environmental economics class several years ago. If I recall the research, the higher a refund, the more likely it is that a bottle will be recycled.
I recall the professor and I jokes about the incentive that exists to bring bottles to a jurisdiction that provides a higher payout for returned bottles – referencing the Seinfeld episode where characters used a mail truck to effectively take advantage of higher refunds in a neighboring state.
I came across an article today about some folks who got busted for allegedly taking advantage of this sort of scheme in Maine. Apparently this is a type of fraud – and three people were just charged for the first time in the state for trying to cash in out of state bottles.
If you’re an economics nerd wanting to read about this failed attempt at arbitrage or just want to see one of the other flaws in Kramer and Newman’s plan follow the link: http://www.newson6.com/Global/story.asp?S=14013813
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