Improving Recycling Markets

Societies produce ever-growing quantities of solid waste, from packaging to abandoned televisions and cars. Disposing of this waste, often by burying it in landfills or burning it, produces significant soil contamination, as well as air and water pollution. It is particularly important to manage hazardous solid waste safely and efficiently.

One way of limiting the scale of the problem is to recycle waste where it is economic to do so. As such, OECD governments are setting recycling targets at increasingly higher levels, and for a growing range of materials. Another reason for recycling for some governments is that it can contribute to “sustainable materials management”, reducing pressures on natural resource stocks – recycling paper and cardboard packaging, for example, not only reduces the number of trees being cut down to produce pulp, but also uses less energy than producing paper using new materials.

Recycling is playing a larger role in our economies, at least partly thanks to government incentives. The Bureau of International Recycling (BIR) has estimated that the recycling industry handles more than 500 million tonnes of waste and employs more than 1.5 million people, with an annual turnover of USD 160 billion.

Recycling only makes sense if it is economically attractive – and that means recycling markets must function properly. What kind of barriers and failures are recycling markets facing and how can they be overcome? This Policy Brief looks at how recycling markets have developed and what government can do to encourage continued growth in recycling and use of recycled materials.

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