Municipal waste generation and the EKC hypothesis new evidence exploiting province-based panel data

Abstract

This article provides empirical evidence on delinking and Environmental Kuznets Curve (EKC) for municipal waste generation in Italy. A disaggregated panel data-set on Italian Provinces is exploited. The empirical analysis of different specifications shows a first evidence in favour of an EKC relationship with regard to waste generation. Nevertheless, the turning point (TP) is at very high levels of added value per capita (around 23 000–26 000€), which concern a very limited number of wealthy Northern Italian provinces. Finally, the test on some waste management instruments proxies, leads to the conclusion that they are not yet impacting waste generation. To lower the TPs and to avoid an increasing gap between geographical areas, market based and more effective policy instruments should be implemented. In particular, the weight of waste policies should be rebalanced towards waste prevention targets according to the European waste hierarchy.

Notes

¹ For recent surveys on the varied areas of application of the EKC hypothesis see Lekakis and Kousis (2001), Dinda (2004), Stern (2004), Copeland and Taylor (2004), Mazzanti and Zoboli (2005), Cole (2003), Dasgupta et al. (2002), Ekins (1997).

² See Jacobsen et al. (2004).

³ For air emissions see the US-based study by List and Gallet (1999), who analyse state-level time series.

⁴Andersen et al. (2006) econometrically estimate waste trends for EU15 and EU10 new entrants, finding that waste generation is linked to economic activities by nonconstant trend ratios, which is in line with EKC reasoning. A rather descriptive analysis of delinking of EU countries then shows a forecast evidence in favour or relative delinking. In any case it is not confirming EKC evidence. For the period 2005 to 2020 projections for UK, France and Italy show a growth in MSW of around 15–20%.

⁵ APAT is the environmental agency. It collects data through questionnaires mailed to public and private organizations. APAT is a member unit of EIONET (European Environment Information and Observation Network), a partnership network of the EEA, established in 1994, which is aimed to provide timely and quality assured data for assessing the state of the environment in the EU and for carrying out ex post policy evaluation.

⁶Shobee (2004) suggests a third order polynomial specification as more realistic relationship between environmental degradation and income per capita. The issue still remains unresolved, with the EKC hypothesis relying mainly on empirical evidence. Cubic specifications are preliminary tested but they are not deemed relevant in our case, and for waste in general, since there is not evidence of a first TP for waste generation yet.

⁷ The transition phase is gradual. Early implementation may be a sign of policy commitment.