Environmental Externalities of Secondhand Markets—Based on a Dutch Auctioning Company

Abstract

Buying reused products rather than new ones could reduce the emissions of greenhouse gases (GHGs). There are many aspects that can influence whether used products actually cause emissions to increase or decrease. This paper assesses the effects of secondhand markets on GHG emissions by using data on twelve product categories from Troostwijk Auctions, which is a Dutch auctioning company. Data came from a carbon footprint database, survey data and many other sources. The net impact of secondhand trade is calculated by combining existing formulas in the literature and by performing regressions to estimate the values of unknown data. A methodology is proposed to find appropriate assumptions to handle uncertainty of carbon footprints. The main result is that the emission savings due to reuse of almost all products in the analysis are offset because many buyers purchase goods that they would not have bought new. Trade in the vehicles included in this study even adds emissions.

Drivers of Consumer Participation in Online Second-Hand Transactions

“…As far as retailers are concerned, even if some (situational and socio-demographic) factors are beyond their control, they must be aware of this phenomenon and adapt to it [14,36,56]. According to our research, participants in online second-hand platforms are an attractive niche (in terms of willingness/ability to pay): full-time job, with children and car, eco-friendly, and spending time on the internet (although it is fair to say that these consumers are also cost-aware).…”

“…Moreover, it seems that, differently from other areas of the online economy [36], consumer participation in online second-hand markets is driven by structural factors (e.g., price awareness, income, environmental awareness, internet skills) which do not change abruptly. Therefore, on the practical side, retailers can try to target this niche in order not to lose business opportunities [10,56].…”

“…Even from a strictly environmental perspective, the final impact is likely to depend on the type of goods exchanged. An increase in second-hand transactions, when involving durable energy-intensive goods (such as vehicles or domestic appliances), may imply a slower pace of adoption of more eco-friendly goods [56], although in general the impact of second-hand trading should be positive due to the avoided environmental costs caused by the production of new goods [30]. Nonetheless, it is important to recall that many transactions take place face-to-face [1], entailing an actual trip to exchange the good.…”