Cost Savings of Unit-Based Pricing of Household Waste: The Case of the Netherlands

22 Pages Posted: 21 Apr 2005

See all articles by Elbert Dijkgraaf

Elbert Dijkgraaf

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE); Erasmus University Rotterdam, SEOR-ECRi

Raymond Gradus

The Netherlands Ministry of Social Affairs and Employment

Abstract

Using a panel data set for Dutch municipalities we estimate effects for weight-based, bag-based, frequency-based and volume-based pricing of household waste collection. Unit-based pricing shows to be effective in reducing solid and compostable and increasing recyclable waste. Pricing has no effect on the waste collected in surrounding municipalities (waste tourism). However, unit-based pricing may lead to illegal dumping. While empirical evidence is scarce, a social cost-benefit analysis shows that if the social valuation of illegal dumping is in line with the social costs for collecting and treating solid waste, the weight or bag-based systems are preferable.

Keywords: Municipal waste management, social welfare, unit-based pricing systems

JEL Classification: H31, H71, Q38

Suggested Citation

Dijkgraaf, Elbert and Gradus, Raymond, Cost Savings of Unit-Based Pricing of Household Waste: The Case of the Netherlands. Available at SSRN: https://ssrn.com/abstract=703962

Elbert Dijkgraaf (Contact Author)

Erasmus University Rotterdam (EUR) - Erasmus School of Economics (ESE) ( email )

P.O. Box 1738
3000 DR Rotterdam, NL 3062 PA
Netherlands

Erasmus University Rotterdam, SEOR-ECRi ( email )

P.O. Box 1738
H 7-34
Rotterdam, 3000 DR
Netherlands
+31 10 4082590 (Phone)
+31 10 4089650 (Fax)

HOME PAGE: http://www.ecri.nl

Raymond Gradus

The Netherlands Ministry of Social Affairs and Employment ( email )

Den Haag
Netherlands

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