Incentives for Environmentalism

One thing I immediately noticed about Cape Town is the strong commitment many townspeople have to recycling and undertaking other actions that benefit the environment. (Thought: does this come from being surrounded by so much natural beauty? Or does causality run the other way? Also, poorer areas in Cape Town are less vigilant about recycling: is environmentalism a luxury good?). I think that this has rubbed off on me in an interesting way. Back home in the US, I often don’t recycle an aluminum can if I have to spend time walking around searching for the appropriate bin or if the said bin is rather far away (i.e., ~20 feet or so…just kidding).

I realized that my behavior here is completely different: I make sure seek out the recycling bin because I don’t want to be looked upon as the jerk who doesn’t care about the Earth. The one time I didn’t manage to recycle (because I was already late for a meeting) I wrapped my soda can in a plastic bag and carefully stuffed it near the back of a trash can, away from the possibly judgmental eyes of others.

As a friend of mine noted, this suggests that shame might be an effective to induce people to be nice to the environment. I have to admit that I’m not a big fan of using shame for public policy. In America, we’ve indirectly (or otherwise) shamed smokers and are starting to shame obese people, and I don’t think it has worked that well in either case. However, somehow shaming people into recycling seems less pernicious, though every intellectual reason I come up with why this is any different fails to clear my own internal robustness checks.

Less squirmy, to me at least, are financial incentives. A popular idea is creating a market for pollution permits. Companies buy and sell the right to emit pollutants at certain rates. The idea is that, by introducing a cost for pollution, companies internalize the cost of environmental damage and therefore pollute less. Here’s another one: as a colleague of mine pointed out, supermarkets in Ireland introduced a 15 cent charge for plastic bags. The use of these items dropped considerably.

The Chinese fast food stall here at the University of Cape Town also provides financial incentives, with these being geared towards reducing the use of Styrofoam containers. Patrons who bring their own plates and utensils receive a 0.5 R discount (off a typical meal of 13-15 Rand). It’s not a bad deal, but very few people have taken the proprietor up on this. I wonder if the incentive would be more effective if it was changed to a R 0.50 charge rather than savings. I tried to get the stall owner to do a randomized experiment on this, but he was not too keen.