Would New York City Benefit from a Plastic Bag Fee? Considering Data from Montgomery, MD Daphne Basangwa Follow Dec 22, 2018 · Unlisted

I recently moved back to the East Coast (New York City) from Palo Alto, California. Among the many differences between the two places, New York stores provide single-use carry-out bags and do not charge for them. This was quite the reverse cultural shock experience. I watched in amazement as the plastic bags I hoarded to use as trash can liners grew to an unmanageable size relative to my tiny New York room. I now always bring my own bag to grocery stores.

In 2016, California voted to approve the state-wide Single-Use Carryout Bag Ban. Most retail stores in California are no longer allowed to provide single-use plastic bags to shoppers. They may instead provide reusable grocery bags or paper bags made from recycled material at a cost of at least 10¢ per bag to the shopper. Stores keep all proceeds from the bags. New York City came close to enforcing a similar bag fee when the City Council voted to approve a 5¢ charge for plastic bags in 2016. The fee fell through in 2017 however, after it was barred by a bill passed by the Senate.

I’ve grown curious if and how a single-use bag tax would change plastic bag usage in New York City. I found data from Montgomery county, Maryland which in 2011 effected the Montgomery County Carryout Bag Law to charge shoppers 5¢ a piece for single-use carryout bags at retail stores. In Montgomery, unlike in California, 80% of the amount collected from the bags is due to the county. As a result Montgomery County has good data on their Bag Law program.

Here, I examine the data to see what effect, if any, the Carryout Bag Law has had on buyer behavior. Ideally, we would compare a pre-treatment Montgomery (or a similar untreated county) to Montgomery after the bag tax was effected. However, we only have data from Montgomery, and only after the fact. So we’ll instead investigate the trend in bag use over time since the law was effected. I’ll discuss data preparation first. My R code and the data can be downloaded here. Feel free to skip to the takeaways at the end of the post!

Brief Introduction to the Bag_Tax Data

The data contains 1303 unique vendors and their roughly monthly contributions to the bag tax. Each entry (row) is a unique contribution made by a vendor during a time period, indicated by the first and last day of the period. Entries report the number of bags sold and dollar amount collected, among other things (see Table 1 for a sample from the data. I didn’t include all the columns). Data cleaning was quick: I removed entries which were dated before the law came into effect, and entries that appeared to be from the future (When I downloaded the data, the website reported that they had last been updated on Aug 9, 2018. Any entries after that were considered wrongly dated). I also omitted entries in which the first day of the period was dated after the last day. I lost some data in the process. Assuming these omissions are randomly distributed, and considering the relatively large size of the data set (39,678 entries uncleaned, 293 entries omitted), the omitted rows shouldn’t have a huge effect on our findings. While the omission lowers the total bag count and dollar amount, it shouldn’t significantly affect relationships between variables.

Table 1: A few randomly selected rows from the data

For analysis, I aggregated the data into months, then years. If the collection cycle for a vendor cut across months as most of them did, I proportioned the number of bags sold into the affected months before further aggregating the data into years.

A Few observations:

The data reports over 413 million bags sold between May 2011 and August 2018, totaling $20 million in gross revenue.

Local and semi-local stores, which I defined as being headquartered in Montgomery County or elsewhere in the State of Maryland respectively, make up 68.4% of the total number of stores recorded and contribute 23.2% of the bag tax. Non-local stores (stores headquartered outside the state of Maryland), contribute an average of 76.8% of the bag tax. The largest contributors to the tax are large grocery stores, pharmacies, and department stores including Giant, Safeway, Whole Foods, and Target. These are primarily non-local (see Figure 3).

Figure 1: Raw plot of the Bag_Tax data set. Each dot represents a row.

Figure 2: Number of carryout bags sold by store location

Figure 3: Bar plot showing 20 largest stores

We see seasonal trends in purchasing volume. Consumers make the most purchases in December, October, and in the summer months. This is consistent with well-established retail seasons including the December holiday rush, the post-holiday lull, and the summer boom. These seasonal trends are especially evident in large retail stores.

Figure 4A below shows the number of bags sold each month between January 2012 and August 2018. The seasonal purchasing patterns remained roughly consistent over the years, while bag purchases rose (the lines representing years are similarly toothed but shift upwards over time). Figure 4B shows growth curves for individual months. It’s interesting to note that while there has been a steady increase in bags sold for lower-volume months, the number of bags sold during higher-volume months (August, October, and December) has varied wildly between 2012 and 2017.

Figure 4: Number of bags sold by month and year

Analysis

With the data aggregated into years, I ran a simple linear regression of the variable bagCount against time in years from 2012 to 2017 (see Figure 5). I found a statistically significant positive relationship between the two variables (p = 0.014). The resulting model was:

where bagCount is in units of millions of bags. On average, the number of carryout bags bought at stores in Montgomery County increased by 943,700 annually between 2012 and 2017. This model accounts for 81% of the variability in bag purchases observed in the county.

Figure 5: Linear Regression of bagCount against year (Model 1)

The population of Montgomery County has grown steadily over time, from 993,326 in 2011 to 1,058,810 in 2017. I found these data here. A regression model of bagCount against time in years controlling for population explains more variability in the data than Model 1. However, results on the individual predictor variables are not intelligible because the variables year and population are highly correlated (c = 0.9988, see Figure 6 for a plot of population against time). This model wasn’t considered.

Figure 6: Population Growth in Montgomery County between 2010 and 2017

Instead, I ran a second linear model of the variable bagCount against population. The resulting model was:

On average, an increase of 1 in the population of Montgomery County is associated with an increase of 95 in the number of bags sold in the county between 2012 and 2017 (p = 0.011). This model shows that increasing population and thus purchasing activity explains 83% of the variability in the number of bags sold between 2012 and 2017.

One caveat: I ran these models with data starting in 2012 because of spotty data in 2011. As we consider the results, it is possible that improved reporting contributed to the apparent increase in bag purchases over time. I look into this in a follow-up post.

Takeaways (or Carry-Outs?)

The Montgomery County Bag Tax has brought in much-needed resources which the county uses to keep its water systems clean. However, it hasn’t resulted in any evident long-term change in consumer behavior as measured by consumption trends over time. In fact, since the law was effected, there has been a steady increase in carryout bag consumption, albeit one that is in part explained by a growing population. Because carryout bags remain a convenient low-cost option in Montgomery, consumers continue to use them. It doesn’t seem that a small fee similar to the one charged in Montgomery would by itself be effective in changing consumer behavior in New York City.

In California, a slightly higher fee was coupled with a ban on single-use plastic bags for most retail stores. While I do not have data on California, it seems that the program there was more effective in getting shoppers to bring their own bags. Another thing comes to mind as a possible supplement to the bag fee: prompts. Prompts may be simple messages saying, “Save money and the environment by bringing your own bag” posted at the point of sale. They may also be voice prompts — e.g. cashiers checking with shoppers if they want bags before bagging their items — which some studies have found effective. Stores too can benefit from prompts by shoppers. In New York, cashiers bag and double bag items as a matter of course. When I go shopping these days, I try to remember to bring my reusable bag to the bagging area before having my items rung up and inevitably placed into a carryout bag!

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Click here to read my follow-up post: Chain Stores and Holiday Shopping.

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Originally published at consultingthedata.com