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Social-Optimal Household Food Waste: Taxes and Government Incentives

Author

Listed:
  • Bhagyashree Katare
  • Dmytro Serebrennikov
  • H. Holly Wang
  • Michael Wetzstein

Abstract

In 2010, 21% of the total food available for consumption in the United States was wasted at the household level. In response to this waste, a number of counties and U.S. localities have instituted policies (disposal taxes) directed toward reducing this waste. However, currently there is no federal food-waste disposal tax. The aim of this paper is to establish a theoretical foundation for household food waste, and based on this theory, to determine the social-optimal food-waste (disposal) tax, along with a government incentive. The theory unravels the interrelation between social food insecurity and external environmental costs, which is not generally considered by households when they waste food. A social-optimal disposal tax and government incentive involve Pigovian mechanisms and governmental expenditures. For a zero level of food waste, the social-optimal disposable tax and government incentive approach infinity.

Suggested Citation

  • Bhagyashree Katare & Dmytro Serebrennikov & H. Holly Wang & Michael Wetzstein, 2017. "Social-Optimal Household Food Waste: Taxes and Government Incentives," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 99(2), pages 499-509.
    • Handle: RePEc:oup:ajagec:v:99:y:2017:i:2:p:499-509.
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    File URL: http://hdl.handle.net/10.1093/ajae/aaw114
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    Citations

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    Cited by:

    1. Xu, Lei, 2024. "Household Food Waste Patterns: Exploring Categorical Price and Expenditure Elasticities Using a Demand System Approach," 2024 Annual Meeting, July 28-30, New Orleans, LA 343717, Agricultural and Applied Economics Association.
    2. Min, Shi & Wang, Xiaobing & Yu, Xiaohua, 2021. "Does dietary knowledge affect household food waste in the developing economy of China?," Food Policy, Elsevier, vol. 98(C).
    3. Aino Friman & Nina Hyytiä, 2022. "The Economic and Welfare Effects of Food Waste Reduction on a Food-Production-Driven Rural Region," Sustainability, MDPI, vol. 14(6), pages 1-18, March.
    4. Na Luo & Tava Lennon Olsen & Yanping Liu, 2021. "A Conceptual Framework to Analyze Food Loss and Waste within Food Supply Chains: An Operations Management Perspective," Sustainability, MDPI, vol. 13(2), pages 1-21, January.
    5. Cuffey, Joel & Li, Wenying & Yu, Yang & Miao, Ruiqing, 2023. "Retail food environment and household food waste: An empirical study," Food Policy, Elsevier, vol. 117(C).
    6. Craig E Landry & Travis A Smith, 2019. "Demand for Household Food Waste," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 41(1), pages 20-36, March.
    7. Brenna Ellison & Mary K Muth & Elise Golan, 2019. "Opportunities and Challenges in Conducting Economic Research on Food Loss and Waste," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 41(1), pages 1-19, March.
    8. Paroissien, Emmanuel & Beatty, Timothy K.M. & Nebout, Antoine, 2024. "Household food waste and the opportunity cost of time," Ecological Economics, Elsevier, vol. 216(C).
    9. Bhagyashree Katare & H. Holly Wang & Jonathan Lawing & Na Hao & Timothy Park & Michael Wetzstein, 2020. "Toward Optimal Meat Consumption," American Journal of Agricultural Economics, John Wiley & Sons, vol. 102(2), pages 662-680, March.
    10. Massimiliano Cerciello & Massimiliano Agovino & Antonio Garofalo, 2019. "Estimating urban food waste at the local level: are good practices in food consumption persistent?," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 36(3), pages 863-886, October.
    11. Jovanovic, Nina & Katare, Bhagyashree & Wetzstein, Michael E., 2018. "Take all You Want, but Eat all You Take: Effectiveness of a Financial Incentive on Individual Food Waste," 2018 Annual Meeting, August 5-7, Washington, D.C. 274133, Agricultural and Applied Economics Association.
    12. Robert Evan Sanders, 2024. "Dynamic Pricing and Organic Waste Bans: A Study of Grocery Retailers’ Incentives to Reduce Food Waste," Marketing Science, INFORMS, vol. 43(2), pages 289-316, March.
    13. Alba J. Collart & Matthew G. Interis, 2018. "Consumer Imperfect Information in the Market for Expired and Nearly Expired Foods and Implications for Reducing Food Waste," Sustainability, MDPI, vol. 10(11), pages 1-17, October.
    14. Na Hao & Yi Zhang & Huashu Wang & H. Holly Wang, 2022. "Which Consumer Perceptions Should Be Used in Food Waste Reduction Campaigns: Food Security, Food Safety or Environmental Concerns?," Sustainability, MDPI, vol. 14(4), pages 1-11, February.
    15. Brian E. Roe & Kathryn Bender & Danyi Qi, 2021. "The Impact of COVID‐19 on Consumer Food Waste," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 43(1), pages 401-411, March.
    16. Yu Zhang & Danyi Qi, 2024. "How to reduce household food waste during and after the COVID‐19 lockdown? Evidence from a structural model," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 68(3), pages 628-652, July.
    17. Jayson L. Lusk & Brenna Ellison, 2020. "Economics of household food waste," Canadian Journal of Agricultural Economics/Revue canadienne d'agroeconomie, Canadian Agricultural Economics Society/Societe canadienne d'agroeconomie, vol. 68(4), pages 379-386, December.
    18. Grant, Kara R. & Gallardo, R. Karina & McCluskey, Jill J., 2020. "Factors Influencing Consumers’ Expected Food Waste," Journal of Food Distribution Research, Food Distribution Research Society, vol. 51(3), November.

    More about this item

    Keywords

    Externalities; food insecurity; food waste; social welfare; sustainability;
    All these keywords.

    JEL classification:

    • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • H21 - Public Economics - - Taxation, Subsidies, and Revenue - - - Efficiency; Optimal Taxation
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • I31 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - General Welfare, Well-Being
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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