Economics of Household Waste Management in Kolkata : Proposed Steps towards Improved Efficiency.

Abstract

The city of Kolkata generates more than 4000 tons of solid waste per day. As a group, households are the single largest generators of munic- ipal waste and account for more than 50 percent of the total waste in the city. As open dumping is no longer viable, the Kolkata Municipal Corporation is trying alternative modes of disposal such as compost- ing. However, in the absence of incentives, households do not separate organic waste from regular waste; this, in turn, increases the process- ing cost of compost producing units in Kolkata. Using a simple static general equilibrium model, we consider the optimal policies that would induce source separation of post-consumption waste at the household level. It appears that a deposit refund system coupled with a subsidy on organic manure would be the optimal outcome. However, from the point of view of the local bodies, a user fee coupled with a subsidy on compost output is the first best outcome though its efficiency can be questioned given the possibility of illegal dumping.