|M.Sc Thesis||Department of Industrial Engineering and Management|
Municipalities everywhere have been coping with increasing amounts of solid waste and need to formulate efficient and sustainable solutions to deal with the problem. Recycling is often proposed as one of the options. The higher the rate of household participation in the recycling effort, the more this option becomes the most economically efficient solution. However, households are not always willing to fully cooperate, especailly if cooperation involves high investment of time, space, and out-of-pocket expenditure. The aim of this study is to examine policy measures which would render recycling the preferred solution on economic efficiency grounds.
The study is unique in the sense that its conclusions are based on observed households behavior when faced with increased disposal costs, in addition to the usually-collected information on their willingness to pay responses in hypothetical scenarios. A household telephone survey was employed to gather data on households behavior and willingness to pay for recycling services in the town of Qiriat Tivon and the township of Misgav, both in northern Israel .
A number of studies have recently assessed the monetary value of the externalities associated with alternative solid-waste management options. In the present context, those subsidies could be seen to reflect the reduction of environmental externalities associated with landfilling, the common default solution for waste management, authorities hope to achieve by decreasing reliance on landfilling. In estimating households’ implied willingness to pay for waste recycling services through the purchase of the new, subsidied waste disposal services, was assessed the difference between the above-estimated externalities and the willingness to pay. It is surmised that this estimated difference reflects the gap between private and public knowledge about the negative impacts of landfilling. This infoormation is very useful in deciding about the extent of the subsidy needed in a recycling programs.
The study also explores the influence of these waste programs on recycling rates. It was found that when household's recycling effort needed to participate in the curbside recycling program is lower, household's participation decision is influenced by economic parameters and age. In this case, the price households are ready to pay for participation is higher. But when households are asked to invest more effort to participate in a recycling program, their decision is influenced mainly by factors of awareness to economic advantages of recycling. Households are ready to pay lower price to participate in this program. In both cases subsidy is needed to get an efficient level of recycling. Median price that households are willing to pay for recycling devices is found to be about 370 NIS (approximately 90$), or about 0.15 NIS (approximately 3.5 cents) per kg recycled waste.