Cost Savings of Unit-Based Pricing of Household Waste: The Case of the Netherlands
22 Pages Posted: 21 Apr 2005
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
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