Managing Municipal Solid Waste with low citizen involvement: the case of Hong Kong

Julie Metta, Coline Metta-Versmessen () and Valeria Alvarado ()
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Coline Metta-Versmessen: LEDa Paris Dauphine University, Chaire Economie du Climat \& EDF, Paris, France
Valeria Alvarado: Hong Kong Polytechnic University, Hong Kong \& Sustainability Specialist, M Moser Associates, Hong Kong

No 2024.03, Working Papers from FAERE - French Association of Environmental and Resource Economists

Abstract: While the waste sector has significant decarbonization potential, deploying this potential is difficult in the absence of citizen participation and involvement. In this paper the political management of the waste sector is studied for the case of Hong Kong. Using Weitzman s theorem and extensions, both marginal abatement and damage curves are built to analyse which policy would be the most suitable. From our analysis, we first show that involving citizens in waste reduction and sorting is the main issue for waste management in Hong Kong. Second, we derive that the first best scenario to regulate waste in this context would be through a quantity-based control system. We then detail how this Waste Permit Trading System should be developed to regulate the waste amount in this region. We characterize a system consisting of both landfill permits and recycling credits. We determine the optimal number of permits and credits for the different agents as well as a potential market design that allows for a future linking with the Chinese National Emission Trading System.

Keywords: pollution regulation; quantity-based scheme; carbon market; permit allocation; recycling (search for similar items in EconPapers)
JEL-codes: Q53 Q56 (search for similar items in EconPapers)
Pages: 46 pages
Date: 2024-02
New Economics Papers: this item is included in nep-env
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