It is not at all clear to me that comparing a world with mandated curbside recycling to a world with no recycling (mandates) that we get reductions in MSW generated. At least it is an empirical question. What the heck am I talking about? You might think that by having recycling, less stuff gets put into the waste stream, but that is not clear to me. It is certainly the case that less material is likely to end up in landfills, but it is not obvious that less overall waste will be produced.
Mandated curbside recycling programs can very easily lower the total cost of throwing out trash, so it might very well lead to some people generating more trash than if the recycling program had not been put in place. Now, I do not think the current way trash is priced would lead to the outcome I am describing in this post, but it could. To illustrate, suppose I have to pay a monthly trash disposal fee based on the weight of my trash. And suppose that I spend $15 per month for disposal right now in a world without recycling, and that I generate 1000 lbs per month of trash. What if my town introduces mandatory recycling. They will, for “free” pick up the recyclables that I roll to the curb. In other words, for any given weight of trash I generate, it will now cost me less for disposal. What if, for argument’s sake, that half of my trash is recyclable. Now, it would cost me $7.50 per month to throw out 500 lbs of my MSW and $0.00 to recycle the remaining 500 lbs of recyclables.
How do people respond to price changes like this? Well, it does two things. First, the lower price means I am richer. When I am richer, I consume more of the things that I like and less of the things that I don’t like (we have fancy terms and equations for that). But in this case, I’d have $7.50 of additional income to spend on goods, which generate waste. Of course, this income effect, as it is known, should be perfectly offset by an income effect working in the opposite direction (my taxes should have to go up to pay for the recycling services). If the cost of recycling is on net less than the cost of trash collection, then the income effect would still be positive. But let’s assume that is zero. There is still a second effect. When the price of generating waste falls, there is a substitution effect. Now, people will find it in their interest to substitute toward the less expensive trash “consumption” and away from the now more expensive other ways to consume. Some things that maybe made sense to reuse, now end up in the recycling bin. Some objects you may not have bought before (because they were heavy) you may now be induced to purchase because it won’t cost you anything at the margin to dispose of them.
In summary, if the pricing of the recycling program lowers the marginal cost of throwing away anything you should expect to see more stuff thrown away. Will we throw so much more away so as to make recycling a bad idea? That’s an empirical question. I don’t suspect that the effect, if there, is very big, but it is certainly something that serious thinkers about the recycling issue ought not dismiss out of hand, especially when they are crafting pricing policies.
Here is the reference for the post title.