The impact of prices and pricing units on residual and organic waste: Evidence from Wallonia, Belgium

[en] Waste pricing is important to encourage households to reduce their waste and to increase sorting and recycling. Pricing instruments include differentiated prices for the waste fractions collected and the choice of an appropriate pricing unit (volume, weight, levy). In this paper, we test the effectiveness of those different instruments using an original and complete dataset from Wallonia (the southern region of Belgium), covering 10 years and all the 262 municipalities of the region. Our approach is to estimate the sensitivity of households’ production of residual and organic waste to prices i.e., the price elasticities, using sophisticated econometric techniques to control for the endogeneity of prices. For residual waste, we show a significant own-price elasticity, which is higher when organic waste is not collected at the curbside. For organic waste, we found an important and significant cross-price elasticity, but a limited own-price elasticity. Hence, the privileged instrument to encourage waste reduction and sorting should be the price of residual waste. Finally, we show that the weight-based pricing system contributes substantially to the reduction of residual waste.

Research Center/Unit :

LCII - Liège Competition and Innovation Institute - ULiège

Disciplines :

Economic systems & public economics

Author, co-author :

Gautier, Axel ; Université de Liège - ULiège > HEC Liège : UER > UER Economie : Economie industrielle

Salem, Iman ; Université de Liège - ULiège > HEC Liège : UER > UER Economie : Economie industrielle

Language :

English

Title :

The impact of prices and pricing units on residual and organic waste: Evidence from Wallonia, Belgium

Publication date :

2023

Journal title :

Waste Management

ISSN :

0956-053X

eISSN :

1879-2456

Publisher :

Elsevier, New York, United States - New York

Volume :

155

Pages :

99-106

Peer reviewed :

Peer Reviewed verified by ORBi

Available on ORBi :

since 08 May 2021

Statistics

Number of views

137 (26 by ULiège)

Number of downloads

141 (13 by ULiège)

More statistics

Scopus citations^®

Scopus citations^®
without self-citations

OpenCitations

OpenAlex citations

Bibliography

Allers, M., Hoeben, C., Effects of Unit-Based Garbage Pricing: A Differences-in-Differences Approach. Environ. Resour. Econ. 45:3 (2010), 405–428.
Andersson, C., Stage, J., Direct and indirect effects of waste management policies on household waste behaviour: The case of Sweden. Waste Manage. 76 (2018), 19–27.
Bel, G., Gradus, R., Effects of unit-based pricing on household waste collection demand: A meta-regression analysis. Resource and Energy Economics. 44 (2016), 169–182.
Bernad-Beltrán, D., Simó, A., Bovea, M.D., 2014. Attitude towards the incorporation of the selective collection of biowaste in a municipal solid waste management system. A case study. Waste Management. 34 (12), 2014, 2434-2444.
Best, H., Kneip, T., Assessing the Causal Effect of Curbside Collection on Recycling Behavior in a Non-Randomized Experiment with Self-Reported Outcome. Environ. Resource Econ. 72 (2019), 1203–1223.
Bilitewski, B., From traditional to modern fee systems. Waste Manage. 28 (2008), 2760–2766.
Callan, S.J., Thomas, J.M., The impact of state and local policies on the recycling effort. Eastern Econ. J. 23:4 (1997), 411–423.
Callan, S., Thomas, J., Analysing demand for disposal and recycling services: A systems approach. Eastern Econom. J. 32:2 (2006), 221–240.
Cameron, C., Trivedi, P.K., Microeconometrics: Methods and Applications. 2005, Cambridge University Press, New York.
De Jaeger, S., Eyckmans, J., From pay-per-bag to pay-per-kilo: The case of Flanders revisited. Waste Manage. Res. 33:12 (2015), 1103–1111.
Dijgraaf, E., Gradus, R., Cost savings in unit-based pricing of household waste: the case of the Netherlands. Resource and Energy Economics. 26:4 (2004), 353–371.
Favoino, E., Giavini M., 2020. Bio-waste generation in the EU: Current capture levels and future potential, Report for Bio based industry consortium and Zero Waste Europe, https://biconsortium.eu/sites/biconsortium.eu/files/documents/BIC-ZWE%20report%20-%20Bio-waste%20generation%20in%20the%20EU%20-%20current%20capture%20and%20future%20potential.pdf.
Gautier, A., Reginster, S., La collecte des déchets en Wallonie: organisation et performances. Regards Economiques. 106 (2013), 1–12.
Gautier, A., Salem, I., L'effet des prix et des systèmes de tarification sur les quantités de déchets résidentiels: le cas de la Wallonie. Revue Economique. 72 (2021), 1023–1053.
Gellynck, X., Verhelst, P., Assessing Instruments for Mixed Household Solid Waste Collection Services in Flanders. 2008, The Waste Market Institutional Developments in Europe, Springer, Netherlands.
Huang, J.C., Halstead, J.M., Saunders, S.B., Managing municipal solid waste with unit-based pricing: policy effects and responsiveness to pricing. Land Econ. 87:4 (2011), 645–660.
Kinnaman, T.C., On User Fees for Refuse Collection, 1994, dissertation, Department of Economics, University of Virginia.
Kinnaman, T.C., Fullerton, D., Household Responses to Pricing Garbage by the Bag. American Economic Review 86:4 (1996), 971–984.
Kinnaman, T.C., Fullerton, D., Garbage and Recycling in Communities with Curbside Recycling and Unit-Based Pricing (No. 6021), 1997, National Bureau of Economic Research, Inc.
Kinnaman, T.C., Fullerton, D., Garbage and recycling with endogenous local policy. J. Urban Economics 48:3 (2000), 419–442.
Linderhof, V., Kooreman, P., Allers, M., Wiersma, D., Weight-based pricing in the collection of household waste: The Oostzaan case. Resource Energy Economics 23:4 (2001), 359–371.
Mickaël, D., The comparative effectiveness of persuasion, commitment and leader block strategies in motivating sorting. Waste Manage. 34:4 (2014), 730–737.
Morlok, J., Schoenberger, H., Styles, D., Galvez-Martos, J.-L., Zeschmar-Lahl, B., The Impact of Pay-As-You-Throw Schemes on Municipal Solid Waste Management: The Exemplar Case of the County of Aschaffenburg, Germany. Resources, 6(1), 2017, 8.
Okonta, F.N., Mohlalifi, M., Assessment of factors affecting source recycling among metropolitan Johannesburg residents. Waste Manage. 105 (2020), 445–449.
Park, S., Factors influencing the recycling rate under the volume-based waste fee system in South Korea. Waste Manage. 74 (2018), 43–51.
Park, S., Lah, T.J., Analysing the success of the volume-based waste fee system in South Korea. Waste Manage. 43 (2015), 533–538.
Reschovsky, J.D., Stone, S.E., Market incentives to encourage household waste recycling: Paying for what you throw away. J. Pol. Anal. Manage. 13 (1994), 120–139.
Ribas Alzamora, B., Tobias de V.Barro., R., 2020. Review of municipal waste management charging methods in different countries, Waste Management, 115, p. 47-55.
Sasao, T., De Jaeger, S., De Weerdt, L., Does weight-based pricing for municipal waste collection contribute to waste reduction? A dynamic panel analysis in Flanders. Waste Manage. 128 (2021), 132–141.
Seguino, S., Criner, G., Suarez, M., Solid Waste Management Options for Maine: The Economics of Pay-by-the-bag Systems. Maine Policy Rev. 4:2 (1995), 49–58.
Usui, T., Takeuchi, K., Evaluating unit-based pricing of residential solid waste: a panel data analysis. Environ. Resour. Econ. 58:2 (2014), 245–271.
Van Houtven, G.L., Morris, G.E., Household behaviour under alternative pay-as-you-throw systems for solid waste disposal. Land Economics. 75 (1999), 515–537.
Williams, I.D., Kelly, J., Green waste collection and the public's recycling behaviour in the Borough of Wyre, England. Resour. Conserv. Recycl. 38:2 (2003), 139–159.
Wooldridge, J.M., 2010. Econometric Analysis of Cross Section and Panel Data MIT Press, London.