Epsilon Archive for Student Projects

Abstract

This paper examines whether European countries with different levels of landfill dependence experienced different rates of recycling following the Council Directive (1999/31/EC) on the landfill of waste, in contrast to previous research, which has largely focused on the effectiveness of different landfill taxes, bans, or policies. Less attention has been given to whether countries with different initial waste management structures adjusted differently over time. To address this, panel data from 22 European countries covering the period 1995–2022 are used in a fixed-effects event-study specification. The dependent variable is ln recycling, and the main explanatory variable is an interaction term that calculates yearly indicators with a measure of pre-policy landfill dependence. The model also uses ln GDP per capita as a control variable and country- and year-fixed effects. The results indicate that countries with higher pre-policy landfill dependence experienced stronger recycling growth following the directive's implementation period than countries with lower landfill dependence. While the interaction coefficients are statistically insignificant before implementation, they become positive and significant from 2004 onwards and remain significant throughout the later years of the period. Robustness tests give some support of the findings in the main model. However, the results should be interpreted cautiously, since all countries in the sample were exposed to the directive and because the empirical strategy does not identify a clean causal effect of the policy.