Do secondhand markets help the environment? That depends on the situation.
Secondhand trade can theoretically limit greenhouse gas emissions. Certain forms of secondhand trade, however, increase emissions as not all buyers of a used product prevent the production of a new one.
If someone buys a product secondhand instead of new, the emissions in the production process and of the end-of-life treatment are partially prevented. Martijn Mak (Economic Bureau Amsterdam) and Reinout Heijungs (VU University Amsterdam) have mapped out these effects in a study that was recently published in the scientific journal Sustainability (link).
Mak and Heijungs have used the Dutch auction platform Troostwijk Auctions as a case study. They have selected twelve of the company’s more than 1700 product categories for the study. This concerns various types of furniture, electrical appliances, vehicles, lawn mowers, power generators and construction supplies. Mak and Heijungs took into account, among other things, production emissions and emissions at the end of life, the lower efficiency of many older products, transport emissions and the so-called ‘displacement rate’. This displacement rate refers to the number of products produced less due to secondhand purchases.
For the products examined, this displacement rate appears to be decisive for whether reuse helps against global warming. If it is equal to one, reusing reduces emissions, except for the cases of cars and forklifts. However, a survey among buyers of these products showed that the displacement rate was around 0.28. At this value, reuse of the twelve product categories rarely leads to a reduction in greenhouse gases: only in the cases of tables, hand drills and scaffolding. These three categories have in common that the use of the products involves no or relatively few emissions. The more energy-intensive the utilization of a product is, in relative terms, against a limited degree of displacement, the less desirable the secondhand transaction is against global warming. For vehicles, the share of utilization in the total footprint is large. Reuse therefore leads to higher emissions for the cars, forklift trucks and agricultural tractors on the platform.
Although this research is based on a specific auction platform, the results have general relevance. In theory, the secondhand market offers the opportunity to save greenhouse gases, but not all users prevent the production of a new product with their purchase. For that reason, certain forms of secondhand trade actually cause emissions to increase.