Umeå Economic Studies,
Umeå University, Department of Economics

Abstract: In this paper, I study municipal price sensitivity of demand for disposal of residual waste (unsorted waste from households) and mechanisms underlying the relationship. First, I estimate the effect on households’ generation of residual waste with respect to municipal waste collection policies. Second, I estimate to what extent municipalities change waste policy in response to higher costs for disposal of municipal residual waste. The empirical analysis is based on data regarding Swedish municipalities’ waste management systems and disposal costs in the period 2010–2019. Results suggests that the price elasticity of demand is in the range 0.20–0.24. The effect is almost entirely driven by municipalities’ implementation of weight-based collection tariffs for residual waste in response to costlier disposal. Besides weight-based tariffs, separate collection of food waste and joint collection of residual waste and recyclables are also found to have substantial negative effects on residual waste quantities. Nevertheless, such waste policies are not more likely to be implemented in response to higher disposal costs for the municipality.

Keywords: Demand for waste; waste economics; waste management

JEL-codes: D10; Q01; Q50; Q53; Q58

Language: English

34 pages, First version: September 11, 2023. Revised: February 3, 2024.

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