Friday, August 02, 2002

Here's an example of a report that recommends what I consider to be libertarian and economics based principles (market principles), without entirely forgetting social compassion. The report (note that it's funded by the Reason Public Policy Institute, and it's not a scientific study) shows that when you charge people according to how much garbage they throw out they throw out up to 17% less garbage (the rate can be lower depending on the pricing scheme) and recycle more. One important consideration is whether variable pricing, which is more complicated, costs more than it saves. However the report addresses this too, citing a benefit/cost ratio of 7.6 in a year alone!

The report discusses subsidizing low-income customers. This recommendation makes much more sense to me than subsidizing everybody, or subsidizing those who waste more as the more common flat price scheme does. (OTOH, I also find it wasteful for every social program that exists to have a separate way to subsidize low-income customers. Wouldn't it be more efficient to centralize that too? )

BTW, only 20% of the US population gets charged according to how much garbage they produce (at the time of the original SERA study).

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