The effect of prices and pricing systems on the quantities of residential waste: Evidence from Wallonia, Belgium
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84
Price and non-price instruments are increasingly used to encourage households to reduce their waste and to increase sorting and recycling. In this paper, we test the effectiveness of these instruments using a recent complete panel dataset of the entire municipalities in Wallonia (Belgium). The municipalities are responsible for the implementation of the waste policy in a common regional framework and, interestingly, they have to make decisions regarding the price level, the pricing unit, and the waste streams collected at the curbside. Using a fixed effects panel two-step GMM, we show that curbside collection of organic waste reduces residual waste but also reduces the household sensitivity to prices. We also find that the weight-based pricing system has a significant impact on the reduction of residual waste, an effect that is increasing in the long-run, on the improvement of sorting and on the effectiveness of the price instruments.JEL Codes: Q53, L11, D12.
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