A supplier of a generally harmless, minor component material in a product might be assessed high liability damages because the product caused harm, even if that supplier was not a party to the product design and the material was not at fault. This practice has serious implications for commerce generally, and it appears to explain why firms often choose to dispose of scrap and waste rather than seek users for them.

The following example from a glassmaker is illustrative. Certain nonhazardous wastes from glassmaking would make good additions to concrete, improving its properties. Nevertheless the glassmaker disposes of these wastes in a landfill, because the firm's legal counsel worries about potential liabilities if the concrete ends up in an apartment house or a highway. Such liability risks are hard to predict and quite unacceptable in comparison with the more predictable liabilities related to landfill disposal. Elsewhere in the same industry, however, glass scrap is routinely added to asphalt road-paving material, giving rise to the name "glasphalt".

A shift from selling goods to leasing the services they provide could raise antitrust issues, because leasing can imply greater control of the product market. Separation of wholesale and retail sales organizations was an issue in the IBM and AT&T antitrust actions of recent years, and in the separation of automotive manufacturers from their dealership systems.

CLOSING THE LOOP

Industrial ecology views industry's impact on the environment in terms of a comprehensive system that uses and disposes of materials. We can learn to close the materials loop more efficiently by thinking on a larger scale about the flow back into industry of materials that would otherwise be discarded into the environment. There are numerous means of protecting the environment from industrial wastes. We can, for example, forgo the benefits of a potentially harmful material or we can seek to replace it with a more benign substitute. We can redesign products with a view to reusing materials and components. It is not yet clear what mix of remedies will most economically minimize the impact of industrial materials on the environment. The various possibilities hold out great promise, but there are complex problems and barriers to be overcome as we develop and implement a new, ecologically sound model for the management of materials in industry.

REFERENCES

Allen, D., and N. Behmanesh, 1994. Wastes as Raw Materials. Pp. 69–89 in The Greening of Industrial Ecosystems, B. R. Allenby and D. J. Richards, eds. Washington, D.C.: National Academy Press.



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