18/2008
May
Embedding Landfill Diversion in Economic, Geographical and Policy Settings. Regional and provincial panel data evidence from Italy
 
Massimiliano Mazzanti, Anna Montini, Francesco Nicolli


This paper analyses the process of delinking for landfilling trends embedding the dynamics in a frame where economic, institutional, and geographical and policy variables enter the arena and play their role. On the basis of the recently observed decreasing path of landfilling occurring at EU level, we aim at investigating in depth what main drivers may be responsible for such a phenomenon, and whether differences may be observed focusing the lens on a decentralised provincial based setting. We exploit a rich panel dataset stemming from Official sources (APAT, Italian environmental agency) merged with other provincial and regional based information, covering all the 103 Italian provinces over 1999-2005. Such an extended, decentralised and recent source of data is of major interest for investigations dealing with waste processes and policy valuation, where evidence is typically scattered and rare, given paucity of high quality data. The case study on Italy is worth being considered provided that Italy is a main country in the EU, thus it offers important pieces on information on the evaluation of policies like the 1999 landfill Directive. Then, its problematic economic, institutional and environmental performance heterogeneity allows an interesting analysis of how economic and policy levers impact on the dynamics of landfilling in such settings. Finally, being waste management and landfill policies implemented at a much decentralised level, it provides food for thought for policy making processes that have operated or will operate along similar directions. Evidence shows that the observed decoupling between economic growth and landfilling is driven by a mix of structural factors, as population density and other waste management opportunity: local opportunity costs and landfill externalities matter in shaping waste policies and local commitment to landfill diversion. But not only structural factors are relevant. If on the one hand landfill taxation is not arising as a significant driver of the phenomenon, even at the more coherent regional level, where the tax is implemented, waste management instruments, when we exploit the provincial dataset, are associated to high significant negative effect on Landfilled waste. A good performance on managing waste according to economic rationales helps reducing the amount that is landfilled. In association to the features of the tariff system, we also underline the key role played by the share of separated collection: where it is higher. Both the evolution of collection and tariff system are joint factors that may drive a wedge between the comparative waste performances of northern and southern regions. We finally note that lock in effects linked to the intensity of incinerator sites in the area are relevant for landfilling: though quite obvious, past investments in incineration lock in the region in this technological path, which may be associated to less opportunity cost and lower external effects. The lock in effect driven by the number of landfill sites in the areas is instead significant, a bit counterintuitive perhaps, only when analysing regional data. Summing up, landfill diversion is stronger where the economic cost deriving from high population density, a structural factor, are higher, and waste management collection systems and economic instruments are associated to higher performances. The main economic driver is just weakly impacting, but this is plausible since is more distant to landfilling with respect to waste generation, and landfilling. We may affirm that just relying on the endogenous path characterised by landfilling and economic growth (the baseline Environmental Kuznets Curve scenario) is not assuring delinking. Some policy actions are needed to affect the shape of delinking.

 
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