University of Malta
Few environmental problems exemplify market-failure better than the problem of solid waste does. Its generation, a direct by-product of economic production and consumption, is intimately linked to economic activity and likely to remain so for the next few generations (Kinnaman, 2009; Ferrara and Missios, 2012). This comes at considerable economic cost: besides the costs of collection and transportation (and associated risks), as well as land acquisition, and infrastructural operating and closure costs (Adhikari et al., 2010), waste generates well-documented environmental externalities (Kinnaman, 2006).
In several countries around the world, landfills are still the main solution for this waste stream (OECD, 2008). Associated external effects may include dust, odour, noise, pests, accident risk, air and climatic emissions (notably methane) and various discharges to soil, to ground/surface water bodies and to the marine environment. This can lead to their contamination, to negative health effects and to harmful effects on biodiversity and economic activity (Hoornweg and Bhada-Tata, 2012; European Environmental Agency, 2013). Other end-of-pipe solutions, such as incineration, are also associated with air and climatic pollution (Linderhof et al., 2001; Edgerton et al., 2009). Illegal storage or disposal of waste imposes even greater risks (Kuo and ...