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Global Reuse and Optimal Waste Policy

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  • Hide-Fumi Yokoo
  • Thomas C. Kinnaman

Abstract

Exporting used durable goods for additional consumption in a developing economy, a concept we call \global reuse", has unfortunate negative consequences if those goods contain toxic substances. The cathode ray tubes (CRTs) of televisions and personal computers contain large amounts of lead oxide and cadmium - substances harmful to the natural environment and to human health. But unfortunately the importers of used durable goods rarely possess the technologies, policies, and en- forcement infrastructures necessary to appropriately dispose hazardous waste. A simple general equilibrium model of two-country trade is constructed to discover solutions to the problems associated with global reuse, focusing on policies in de- veloped country. This paper shows that the dual policy of waste tax and exporting tax can achieve social optimum under global reuse economy with negative exter- nality of waste. When developed country is unable to assess exporting tax perhaps due to some pressure from a domestic industry, the waste tax or subsidy can be the alternative policy.

Suggested Citation

  • Hide-Fumi Yokoo & Thomas C. Kinnaman, 2010. "Global Reuse and Optimal Waste Policy," Discussion papers e-09-002, Graduate School of Economics Project Center, Kyoto University.
    • Handle: RePEc:kue:dpaper:e-09-002
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    File URL: http://www.econ.kyoto-u.ac.jp/projectcenter/Paper/e-09-002.pdf
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    References listed on IDEAS

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    1. Don Fullerton & Wenbo Wu, 2002. "Policies for Green Design," Chapters, in: Don Fullerton & Thomas C. Kinnaman (ed.), The Economics of Household Garbage and Recycling Behavior, chapter 5, pages 102-119, Edward Elgar Publishing.
    2. Don Fullerton & Thomas C. Kinnaman, 2002. "Garbage, Recycling, and Illicit Burning or Dumping," Chapters, in: Don Fullerton & Thomas C. Kinnaman (ed.), The Economics of Household Garbage and Recycling Behavior, chapter 2, pages 49-62, Edward Elgar Publishing.
    3. Schulze, Gunther G. & Ursprung, Heinrich W. (ed.), 2001. "International Environmental Economics: A Survey of the Issues," OUP Catalogue, Oxford University Press, number 9780198297666.
    4. Rob Aalbers & Herman Vollebergh, 2008. "An economic analysis of mixing wastes," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 39(3), pages 311-330, March.
    5. Copeland, Brian R., 1991. "International trade in waste products in the presence of illegal disposal," Journal of Environmental Economics and Management, Elsevier, vol. 20(2), pages 143-162, March.
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    Cited by:

    1. Ba, Bocar Samba & Combes-Motel, Pascale & Schwartz, Sonia, 2020. "Challenging pollution and the balance problem from rare earth extraction: how recycling and environmental taxation matter," Environment and Development Economics, Cambridge University Press, vol. 25(6), pages 634-656, December.
    2. Thomas Kinnaman & Hide-Fumi Yokoo, 2011. "The Environmental Consequences of Global Reuse," American Economic Review, American Economic Association, vol. 101(3), pages 71-76, May.
    3. Satoshi Honma, 2019. "Optimal policies for international recycling between developed and developing countries," Letters in Spatial and Resource Sciences, Springer, vol. 12(2), pages 143-153, August.
    4. Núñez-Rocha, Thaís & Martínez-Zarzoso, Inmaculada, 2019. "Are international environmental policies effective? The case of the Rotterdam and the Stockholm Conventions," Economic Modelling, Elsevier, vol. 81(C), pages 480-502.

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