Skip to main content Accesibility Help

Global Reuse and optimal waste policy

  • Hide-Fumi Yokoo (a1) and Thomas C. Kinnaman (a2)

Electronic waste generated from the consumption of durable goods in developed countries is often exported to underdeveloped countries for reuse, recycling and disposal with unfortunate environmental consequences. The lack of efficient disposal policies within developing nations coupled with global free trade agreements make it difficult for consumers to internalize these costs. This paper develops a two-country model, one economically developed and the other underdeveloped, to solve for optimal tax policies necessary to achieve the efficient allocation of economic resources in an economy with a durable good available for global reuse without policy measures in the underdeveloped country. A tax in the developed country on purchases of the new durable good combined with a waste tax set below the domestic external cost of disposal is sufficient for global efficiency. The implication of allowing free global trade in electronic waste is also examined, where optimal policy resembles a global deposit-refund system.

Hide All
Anderson, S.P. and Ginsburgh, V.A. (1994), ‘Price discrimination via second-hand markets’, European Economic Review 38: 2344.
Barrett, S. (1994), ‘Strategic environmental policy and international trade’, Journal of Public Economics 54: 325338.
Cassing, J. and Kuhn, T. (2003), ‘Strategic environmental policies when waste products are tradable’, Review of International Economics 11: 495511.
Copeland, B.R. (1991), ‘International trade in waste products in the presence of illegal disposal’, Journal of Environmental Economics and Management 20: 143162.
Davis, L.W. and Kahn, M.E. (2010), ‘International trade in used vehicles: the environmental consequences of NAFTA’, American Economic Journal: Economic Policy 2: 5882.
Fullerton, D. and Kinnaman, T.C. (1995), ‘Garbage, recycling, and illicit burning or dumping’, Journal of Environmental Economics and Management 29: 7891.
Fullerton, D. and Wu, W. (1998), ‘Policies for green design’, Journal of Environmental Economics and Management 36: 131148.
Kahhat, R., Kim, J., Xu, M., Allenby, B., Williams, E., and Zhang, P. (2008), ‘Exploring e-waste management systems in the United States’, Resources, Conservation and Recycling 52: 955964.
Kennedy, P.W. (1994), ‘Equilibrium pollution taxes in open economies with imperfect competition’, Journal of Environmental Economics and Management 27: 4963.
Kinnaman, T.C. (2010), ‘Optimal solid waste tax policy with centralized recycling’, National Tax Journal 63: 237252.
Krutilla, K. (1991), ‘Environmental regulation in an open economy’, Journal of Environmental Economics and Management 20: 127142.
Puckett, J. (2005), The Digital Dump: Exporting Re-Use and Abuse to Africa, Seattle, WA: Basel Action Network.
Puckett, J. and Smith, T. (2002), Exporting Harm, Seattle, WA: Basel Action Network and Silicon Valley Toxics Coalition.
Shinkuma, T. (2007), ‘Reconsideration of an advanced disposal fee policy for end-of-life durable goods’, Journal of Environmental Economics and Management 53: 110121.
Shinkuma, T. and Managi, S. (2011), ‘The effects of introducing EPR policies in developed countries on international trade, the environment, and social welfare’, in Waste and Recycling: Theory and Empirics, London: Routledge.
Simpson, R.D. (1995), ‘Optimal pollution taxation in a Cournot duopoly’, Environmental and Resource Economics 6: 359369.
Wertz, K. (1976), ‘Economic factors influencing households’ production of refuse’, Journal of Environmental Economics and Management 2: 263272.
Yokoo, H.-F. (2010), ‘An economic theory of reuse’, Sustainability Science 5: 143150.
Yoshida, A., Tasaki, T., and Terazono, A. (2009), ‘Material flow analysis of used personal computers in Japan’, Waste Management 29: 16021614.
Recommend this journal

Email your librarian or administrator to recommend adding this journal to your organisation's collection.

Environment and Development Economics
  • ISSN: 1355-770X
  • EISSN: 1469-4395
  • URL: /core/journals/environment-and-development-economics
Please enter your name
Please enter a valid email address
Who would you like to send this to? *


Full text views

Total number of HTML views: 0
Total number of PDF views: 0 *
Loading metrics...

Abstract views

Total abstract views: 0 *
Loading metrics...

* Views captured on Cambridge Core between <date>. This data will be updated every 24 hours.

Usage data cannot currently be displayed