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The cost implications of waste reduction: factor demand, competitiveness and policy implications

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  • Wendy Chapple
  • Richard Harris
  • Catherine Paul

Abstract

Manufacturing produces both good and “bad” outputs, such as waste, which have negative environmental effects. Economic (e.g., tax) and non-economic (e.g., reputation) incentives encourage firms to reduce waste. However, such practices are costly because decreases in output produced or increases in inputs used may accompany waste reduction. We employ a cost function approach to evaluate patterns of output and waste production and capital, labor, and materials use, for UK manufacturing plants. We find that costs of waste reduction generally imply increasing materials use and capital and labor input saving, but vary by county, region, and industry. Copyright Springer Science+Business Media, LLC 2006

Suggested Citation

  • Wendy Chapple & Richard Harris & Catherine Paul, 2006. "The cost implications of waste reduction: factor demand, competitiveness and policy implications," Journal of Productivity Analysis, Springer, vol. 26(3), pages 245-258, December.
    • Handle: RePEc:kap:jproda:v:26:y:2006:i:3:p:245-258
    DOI: 10.1007/s11123-006-0014-6
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    References listed on IDEAS

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    3. Rolf Fare, 1993. "Derivation of Shadow Prices for Undesirable Outputs: A Distance Function Approach," The Review of Economics and Statistics, MIT Press, vol. 75(2), pages 374-380, May.
    4. Chapple, Wendy & Paul, Catherine J. Morrison & Harris, Richard, 2005. "Manufacturing and corporate environmental responsibility: cost implications of voluntary waste minimisation," Structural Change and Economic Dynamics, Elsevier, vol. 16(3), pages 347-373, September.
    5. Reinhard, Stijn & Knox Lovell, C. A. & Thijssen, Geert J., 2000. "Environmental efficiency with multiple environmentally detrimental variables; estimated with SFA and DEA," European Journal of Operational Research, Elsevier, vol. 121(2), pages 287-303, March.
    6. Donald S. Siegel & Catherine J. Morrison Paul, 1999. "Scale Economies and Industry Agglomeration Externalities: A Dynamic Cost Function Approach," American Economic Review, American Economic Association, vol. 89(1), pages 272-290, March.
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    10. Cohen, Jeffrey P. & Paul, Catherine J. Morrison, 2005. "Agglomeration economies and industry location decisions: the impacts of spatial and industrial spillovers," Regional Science and Urban Economics, Elsevier, vol. 35(3), pages 215-237, May.
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    Cited by:

    1. Ruth Namakonzi & Ruth Namakonzi, 2014. "Environmental management accounting and environmental management in manufacturing industries in Uganda," Working Papers 2014/39, Maastricht School of Management.
    2. Encarna Guillamon-Saorin & Magdalena Kapelko & Spiro E. Stefanou, 2018. "Corporate Social Responsibility and Operational Inefficiency: A Dynamic Approach," Sustainability, MDPI, vol. 10(7), pages 1-26, July.
    3. Justyna Przychodzen & Fernando Gómez-Bezares & Wojciech Przychodzen & Mikel Larreina, 2016. "ESG Issues among Fund Managers—Factors and Motives," Sustainability, MDPI, vol. 8(10), pages 1-19, October.

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    More about this item

    Keywords

    Waste reduction costs; Input composition; Corporate social responsibility; Plant level data; D24; M14;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility

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