June 04, 2008
The Art of Economics: Recycling and the Equal-Marginal Principle

Last summer, co-blogger and NC gubernatorial candidate Mike Munger wrote a very interesting article and did a very interesting podcast on the quasi-religious aura surrounding recycling. I have green sympathies, but as I understand it, recycling a lot of stuff (paper, green glass, etc.) actually creates net environmental damage. Meanwhile, the case for recycling electronics, batteries, and printer cartridges is both environmentally and economically sound (I get what little knowledge I have of this from Mike, who teaches environmental econ). Public policy, however, encourages wasteful recycling while discouraging more efficient recycling. My hunch is that the marginal benefit of each dollar spent on recycling batteries, electronics, and printer cartridges is higher than the marginal benefit of each dollar spent on recycling paper, plastic, and glass. I realize that incomplete property rights and politics make this a pretty complicated issue, but I wonder if we might Pareto-improve by shifting resources away from recycling paper, plastic, and glass and toward recycling electronics. Comments are open if anyone has any thoughts on this.

Posted by Art Carden at 09:40 AM in Economics

Comments

We seem to have posted something on the waste of recycling at the exact same minute. Very coincidental:
http://perfectsubstitute.blogspot.com/2008/06/graduation-advice.html

Posted by: Justin Ross at June 4, 2008 01:41 PM

The statesman who should attempt to direct private people in what manner they ought to employ their capitals would not only load himself with a most unnecessary attention, but assume an authority which could safely be trusted, not only to no single person, but to no council or senate whatever, and which would nowhere be so dangerous as in the hands of a man who had folly and presumption enough to fancy himself fit to exercise it. -Adam Smith

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