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# Economics of Solid Waste Management: A Review

By Muniyandi Balasubramanian

Submitted: June 19th 2020Reviewed: December 2nd 2020Published: December 30th 2020

DOI: 10.5772/intechopen.95343

## Abstract

Solid Waste Management is one of the importance environmental issues at many developing countries. There is a lack of studies on economic analysis of solid waste management in the many cities at the national and international level. Most of the Municipal Corporation or city management is the major responsibility for better waste management. However, the local governments has been allocated budget for solid waste management without analysing cost and benefit of solid waste. Although, waste management budget is focusing on collected waste but, uncollected waste has been creating a number of socio, economic and health issues. Therefore, this chapter has presents a details review on economics of solid waste management at the various developing and developed countries. The main policy implication of the paper is to emphasis on better understanding of economic importance of solid waste management to the local policy makers.

• economics
• solid waste
• cost
• recycling

## 1. Introduction

Solid waste is the byproducts of human activities such as production, consumption and distribution of various goods in the society. There are a number research has been investigated in the various aspects such as technology, innovation, recycling of solid waste management in the developing and developed countries. There are a lack of studies on economic analysis of solid waste management particularly in the developing countries, for example cost and revenue aspects [1, 2]. Most of the municipal corporation has not been maintained proper data on solid waste generation, collection, transportation and final disposal. Therefore economists are confused economic estimation of solid waste management [3]. Moreover, economic analysis of solid waste management is the most helpful to local policy makers on various aspects for instance, designing waste management tax/charges or subsidies at the municipal level [4]; cost and benefits of waste to energy [5] and determining of urban property through the better environmental amenities [6, 7]. There are various economics estimation of per ton of solid waste management in India, For example, National Institute of Urban Affairs [8] had estimated at Rs 135 for per ton of solid waste collection and disposal and another study by National Solid Waste Association [9] had calculated at Rs 417 per ton of solid waste management [3, 10]. Therefore, this chapter has discussed the economics of solid waste management and public policy at the municipal level in various developing and developed countries.

## 2. Economics of solid waste management

The First empirical study to use econometric analysis for determining, among other things, as to which form of service delivery (public or private) had an effect on the municipal cost, was that of Hirsch [11], who had studied a sample of 24 Municipalities in St. Louis country (Missouri). However, this study had used econometric model in terms of the explanatory variables were limited to the data that was an available in 1960s, the year for which he had collected the information. Therefore, the variables that were finally used to explain cost (the average costs per service) were the number of waste collection locations, the weekly collection frequency, whether the collection point was an alone or a collective agencies, the residential area, sources of finance and the form of service management, and the distinction between the municipal and the private delivery. The Article had concluded that there were significant differences in the service cost between the municipal and the private delivery. This study did not find any economies of scale with respect to the output in the service. Hardy and Greission [16] had analysed the possibility of saving costs through cooperative efforts in the collection and the disposal of the solid waste material. Heuristic algorithms had been used to determine the best locations for landfills and the best routes for the collection trucks to follow in the study area in five countries. They had discussed about the rural public service delivery problems, and had designed a method to determine the least cost solid waste management system for the selected areas. According to them the economies of scale to be realised in the disposal phase of a solid waste management system and the costs of collection were dependent on the population density and the size of the service area. The combined collection and disposal costs had indicated that the regional system could be justified for the selected study areas. The least cost system for the five countries have two regional landfills. The annual costs associated with this system of $447.275, was found to be substantially lesser than the amount of$ 519,815 estimated for the system with each county operating the system independently. The results of the economic analysis had indicated that a regional system for the solid waste collection and disposal could be justified from the standpoint of view of costs.

## 5. Conclusion

There is lack of primary investigation on economics of solid waste management at the various municipalities in the many developing countries. The present chapter has discussed the various aspects on economics of solid waste management such as economic instrument, policy issues etc. However, the implementations of economic instruments are the major problems. Therefore, need to strengthen local institution and governance. In many developing countries like India, economists are facing many difficulties for estimating economics of solid waste management due to lack of data on waste generation, disposal and recycling [3, 36, 37, 38]. Economic estimate of solid waste is better understanding for local policy makers for designing healthy urban planning towards achieving sustainable cities. Most of the developing countries are in lack of finance and technology for effective solid waste management. Economics of solid waste management could provide a good framework for solid waste management especially cost and benefit aspects at the local and regional level [39]. Further, economics estimation of solid waste is more helpful to decision makers for designing tax/charges or other economic instrument for efficient allocation of financial and technological resources at the city level [24]. A number of Asian countries are difficult to design better solid waste management due to lack of studies on economic estimation in terms of cost of collection, transportation, segregation and final disposal [1]. Although, there are other economic problems raised due to lack of economic estimation of solid waste, for example negative externality [2]. Therefore, need to support economics of solid waste related studies at the regional, local and national level through the grants, support and guidance for better solid waste management for achieving environmental sustainability.

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Muniyandi Balasubramanian (December 30th 2020). Economics of Solid Waste Management: A Review [Online First], IntechOpen, DOI: 10.5772/intechopen.95343. Available from: