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The determinants of solid waste generation in the OECD: evidence from cross-elasticity changes in a common correlated effects framework

Sinha, Avik, Schneider, Nicolas, Song, Malin and Shahzad, Umer (2022) The determinants of solid waste generation in the OECD: evidence from cross-elasticity changes in a common correlated effects framework. Resources, Conservation and Recycling, 182. ISSN 0921-3449

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Identification Number: 10.1016/j.resconrec.2022.106322

Abstract

Following the COP26 summit, the management of solid waste has been identified as a major policy issue that can only be tackled if nations reorient their innovational endeavors. However, the present academic and policy discourse cannot provide a consensus on how to address this issue at the policy level. The absence of a comprehensive policy framework for achieving this reorientation and addressing the issue has motivated the present study. This paper conducts a comparative investigation of the long-run determinants of municipal solid waste (MSW) generation for the 10 best and least recycling economies in the OECD. We consider a set of technological, regulatory, and institutional regressors such as eco-innovation, environmental tax revenue, governance quality, an index of the structural transformation of the economy, and the capital-to-labor ratio. Based on data with the highest availability and spanning the longest time period (2000–2018), our study adopts a common correlated effects framework accounting for heterogeneity and cross-sectional dependence within the sample. Results of individual impacts show that eco-innovation, environmental tax, governance quality, and capital-to-labor ratio decrease the generation of solid waste with a larger size effect in the top-10 recycling sample of countries. However, findings derived from the dynamic elasticity-based interactive effects stress that environmental tax and governance quality enhance the environmental impact of eco-innovation, whereas structural transformation of the economy and capital-to-labor ratio lower the size of this effect, with a much lower magnitude in the bottom-10 recycling OECD economies. Associated policy recommendations are aimed at aiding the design of adequate waste management policies in the OECD, with inclusive knowledge on this topic.

Item Type: Article
Official URL: https://www.sciencedirect.com/journal/resources-co...
Additional Information: © 2022 Elsevier B.V.
Divisions: Geography & Environment
Subjects: T Technology > TD Environmental technology. Sanitary engineering
JEL classification: C - Mathematical and Quantitative Methods > C2 - Econometric Methods: Single Equation Models; Single Variables > C22 - Time-Series Models
C - Mathematical and Quantitative Methods > C3 - Econometric Methods: Multiple; Simultaneous Equation Models; Multiple Variables; Endogenous Regressors > C39 - Other
Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q5 - Environmental Economics > Q50 - General
Q - Agricultural and Natural Resource Economics; Environmental and Ecological Economics > Q5 - Environmental Economics > Q53 - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
Date Deposited: 25 Apr 2022 11:27
Last Modified: 30 Jun 2022 00:03
URI: http://eprints.lse.ac.uk/id/eprint/114915

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