Wikipedia's Plastic Bag info

Plastic shopping bags, or carrier bags or plastic grocery bags, are a common type of shopping bag in several countries. Most often these bags are intended for a single use to carry items from a store to a home: reuse for storage or trash (bin bags) is common. 

Plastic was first introduced by Alexander Parkes in 1862, and the name was coined by Leo H Baekeland in 1909.  Plastic bags are often made from polyethylene, which consists of a long chain of monomers called ethylene. Ethylene is derived from natural gas and petroleum, and it wasn’t until 1977 that polyethylene was used in forms of plastic grocery bags. The real change in grocery bags didn’t start until 1982, when the two of America’s largest grocery companies Safeway and Kroger started replacing paper bags with more affordable plastic bags. From then on, the usage of plastic bags became the standard for carrying daily groceries from the store, to our vehicles, and finally to our homes.

Composition

Plastic shopping bags are usually made of polyethylene. This can be low-density, resin identification code 4, or most often high-density, resin identification code 2.
Although not in use today, plastic shopping bags could be made from Polylactic acid (PLA) a biodegradable polymer derived from lactic acid. This is one form of vegetable-based bioplastic. This material biodegrades quickly under composting conditions and does not leave toxic residue. 

Bags made of biodegradable polythene film, which decompose when exposed to sun, air, and moisture, and are also suited for composting have been proposed as an alternative to conventional plastic shopping bags. However, they do not readily decompose in a sealed landfill and represent a possible contaminant to plastic recycling operations. Resin identification code 7 is applicable.

Plastic Bag Restrictions

Currently, many countries have either banned plastic bags, or forced customers to pay a tax or levy on each bag used in stores. Australia, China, India, and several African nations have an outright ban on plastic bags. Germany and Ireland instituted a tax on bags. In Ireland, the now 22 euro cents, about 33 U.S. cents tax resulted in a 94% drop in plastic bag use. In the United States, San Francisco became the first city to ban plastic bags, though the ban only applies to large supermarkets. Oakland now also has a ban for large supermarkets. Thirty towns in Alaska have banned plastic bag use. Many other U.S. cities and states foresee similar bans or taxes going into effect by 2010.  Whole Foods Market stopped offering plastic grocery bags on Earth Day 2008, and now offers only paper or reusable bags to customers. 

Wikipedia entry