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Recycling Incentives: Do they pay off?

A few days ago we discussed the impact of economic factors on the decision to recycle. Specifically we discussed the impact of pay-as-you-throw pricing programs for waste disposal. When it comes to household economics, PAYT can be looked at as the ‘stick’. Recycling incentives are the ‘carrot’, and there’s alot of debate over which is more effective.

Some communities have opted to employ recycling incentives to increase recycling rates rather than forcing residents to pay more for disposal.  Programs such as RecycleBank partner with individual municipalities.  Financial rewards are based on volume of recyclables placed at the curb.  To participate, a community must use single-stream collection (materials are not separated) and bins must be embedded with RFID barcodes so that weights may be properly recorded and credited to individual households (Lee, 2008).  Participants receive rewards points that may be redeemed for goods and services at local merchants.  RecycleBank points to these incentives as being a dual positive in that they stimulate recycling participation and promote local businesses at the same time (Lee). 

Like PAYT schemes, the use of incentives has received mixed reviews.  While there is evidence that incentives can improve recycling rates, the effect is often short-lived (Tucker, Murney, & Lamont, 1998).  Given the amount of time required to translate manipulated activity into a long-term habitual behavior, there is likely to be a need for repeat marketing, thus compounding the costs associated with this type of program.  It should also be noted that no incentive will overcome fundamental shortcomings in other areas of the recycling program (Tucker et al.).

In addition to the aforementioned criticisms, there is research that suggests that financial incentives can actually have a negative effect on recycling rates.  Feldman and Perez (2011) offer two explanations.  First is the concept of framing, or how an issue is presented to and perceived by an individual. 

Framing outcomes as losses rather than gains generally affects how people respond…people tend to be more averse to losses (relative to the status quo) than they are attracted by gains” (Feldman & Perez, p. 9). 

So offering a financial incentive as a reward for recycling may have less of an impact than the loss experienced by having to pay more for garbage disposal under a user fee system, or having to pay fines for non-participation under a mandatory recycling program. 

Second is the concept of crowding out, which refers to the distinction between external and internal motivations for behavior.  Environmental concern is a moral behavior that is intrinsically motivated.  A monetary incentive is an external motivation that undermines the value of the intrinsic behavior. 

That is, a person’s own interest in his or her behavior is undermined when the individual is given an extrinsic reason for doing something he or she would have done anyway” (Feldman & Perez, 2011, p. 14). 

The findings further exhibit that as incentives increase so does the crowding out effect (Feldman & Perez). 

Low monetary incentives may have a positive expressive message, which is diluted and becomes negative as the incentive is increased” (Feldman & Perez, p. 15). 

This research suggests that incentives may be useful, but only at a nominal level.

While the possibility exists that monetary incentives may have a negative effect on those who already recycle, the opposite may be true of non-recyclers.  The main focus of any recycling campaign should be on involving those who don’t already participate (Shaw, Lyas, Maynard, & Van Vugt, 2007).  One study involving 104 undergraduate psychology students found that participants who scored low on the New Environmental Paradigm scale (NEP) were significantly less likely to participate in a recycling program when effort was high and no monetary incentive was offered (Schulz & Oskamp, 1996).  However, when a 5 cent per container incentive was added, participation differences between those with high and low NEP scores were negligible (Schulz & Oskamp). 

While financial incentives may not have a significant effect on households that already participate in recycling, there appears to be a benefit, however short-term, in offering incentives to non-participant households. Financial incentives are a reasonable addition to a curbside recycling program, and should be used as an enhancement. However, rewards should be kept low, and should be used in conjuction with a PAYT trash disposal program. Communities should not look at incentives alone as the remedy to low participation rates.


Feldman, Y., & Perez, O. (2011). Motivating environmental action in a pluralistic regulatory environment.

Lee, A. M. (2008, January). Do the right thing and get points! Incentive, 182(1), 63.

Schulz, P. W., & Oskamp, S. (1996). Effort as a moderator of the attitude-behavior relationship: General environmental concern and recycling. Social Psychology Quarterly, 59(4), 375-383.

Shaw, P. J., Lyas, J. K., Maynard, S. J., & Van Vugt, M. (2007). On the relationship between set-out rates and participation ratios as a tool for enhancement of kerbside household waste recycling. Journal of Environmental Management, 83(1), 34.

Tucker, P., Murney, G., & Lamont, J. (1998). A decision support model for the management of recycling schemes. Journal of Environmental Planning and Management, 41(4), 445-462.

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