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| Authors||A. Bucciol, N. Montinari, M. Piovesan|
|Title||Do not trash the incentive! Monetary incentives and waste sorting|
|Publisher||Harvard Business School|
|Title series||HBS working paper|
|Faculty||Faculty of Economics and Business|
|Institute/dept.||FEB: Research Institute in Economics and Econometrics Amsterdam (RESAM)|
|Abstract||This paper examines whether monetary incentives are an effective tool for increasing domestic waste sorting. We exploit the exogenous variation in the pricing systems experienced during the 1999-2008 decade by the 95 municipalities in the district of Treviso (Italy). We estimate with a panel analysis that pay-as-you-throw (PAYT) incentive-based schemes increase by 12.2% the ratio of sorted to total waste. This increase reflects a change in the behavior of households, who keep unaltered the production of total waste but sort it to a larger extent. In addition, we show that several factors that may discourage local administrators from adopting PAYT - illegal dumping and higher cost of management - are not important at the aggregate level. Hence, our results support the use of PAYT as an effective tool to increase waste sorting.|
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