How a Fee Per-Unit Garbage Affects Aggregate Recycling in a Model with Heterogeneous Households

40 Pages Posted: 6 Sep 2000

See all articles by Thomas C. Kinnaman

Thomas C. Kinnaman

Bucknell University - Department of Economics

Don Fullerton

University of Illinois at Urbana-Champaign - Department of Finance; National Bureau of Economic Research (NBER); CESifo (Center for Economic Studies and Ifo Institute)

Date Written: October 1994

Abstract

This paper develops a utility maximizing model of household choice among garbage disposal, recycling, and littering. The impact of a user fee for garbage collection is modelled for heterogeneous households with different preferences for recycling. The model explains (1) why some households participate in curbside recycling programs even in the absence of a user fee, (2) why other households do not participate, even in the presence of a user fee, and (3) why some households choose to litter when others do not. Household choices are aggregated to determine the effect of a user fee on the community-wide quantities of garbage, recycling, and litter. We show how an increase in the user fee can decrease aggregate recycling.

Suggested Citation

Kinnaman, Thomas C. and Fullerton, Don, How a Fee Per-Unit Garbage Affects Aggregate Recycling in a Model with Heterogeneous Households (October 1994). NBER Working Paper No. w4905. Available at SSRN: https://ssrn.com/abstract=226607

Thomas C. Kinnaman (Contact Author)

Bucknell University - Department of Economics ( email )

Lewisburg, PA 17837
United States
570-524-3465 (Phone)

Don Fullerton

University of Illinois at Urbana-Champaign - Department of Finance ( email )

1206 South Sixth Street
Champaign, IL 61820
United States
(217) 244-3621 (Phone)

National Bureau of Economic Research (NBER)

1050 Massachusetts Avenue
Cambridge, MA 02138
United States

CESifo (Center for Economic Studies and Ifo Institute)

Poschinger Str. 5
Munich, DE-81679
Germany

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