Exploring Effective Incentive Design to Reduce Food Waste: A Natural Experiment of Policy Change from Community Based Charge to RFID Based Weight Charge

Sabinne Lee and Kwangho Jung
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Sabinne Lee: Department of Public Administration, Yonsei University, 1599-1885 50 Yonsei-ro Seodaemun-gu, Seoul 03722, Korea
Kwangho Jung: Korea Institute of Public Affairs, Graduate School of Public Administration, Seoul National University, 1 Gwanak-ro, Gwanak-gu, Seoul 08826, Korea

Sustainability, 2017, vol. 9, issue 11, 1-17

Abstract: This research explores the impact of the Radio Frequency Identification (RFID) Household-Based Food Waste Charging System (RHWC) on the reduction of food waste in Mapo-Gu district located in Seoul city from June 2013 to July 2016. Through comparing the amount of food waste disposal between 12 apartment complexes with the RHWC policy (treatment group) and 61 apartment complexes (control group) without the policy, we attempt to identify whether the RHWC can contribute in reducing food waste. In June 2013, all these apartment complexes adopted an apartment complex unit-based food-waste system (i.e., Community-Based Waste Charging system-CWC), but, in January 2016, the 12 apartment complexes introduced the RHWC policy, while the other 61 apartment complexes kept the CWC policy. This natural experiment setting allows us to compare the difference in the quantity of food waste disposal between these two payment policies. The RHWC uses a weight based payment design, through which each household is electronically charged for the weight of food waste they disposes, while the CWC uses a group incentive system where residents pay the same price by dividing total amount of waste charge by total number of household in apartment complex. We, relying on propensity score matching and Difference-In-Difference (PSM-DID) methodology, found a significant difference in the amount of food waste disposal between these two payment systems. Our empirical finding shows that the RHWC deign can reduce more food waste than the CWC design. This study suggests that municipalities can reduce food waste through redesigning incentive mechanism in which it is able to reduce free riding by electronically identifying and monitoring how much residents throw out thanks to RFID technology.

Keywords: food waste; RFID; waste pricing mechanism; PSM-DID methodology; natural experiment (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2017
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:9:y:2017:i:11:p:2046-:d:118042

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