Price ambivalence of secondary resources: joint production, limits to substitution, and costly disposal
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In: Resources, Conservation and Recycling, Vol. 43, No. 1, 01.12.2004, p. 95-117.
Research output: Journal contributions › Journal articles › Research › peer-review
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TY - JOUR
T1 - Price ambivalence of secondary resources
T2 - joint production, limits to substitution, and costly disposal
AU - Baumgärtner, Stefan
PY - 2004/12/1
Y1 - 2004/12/1
N2 - The paper studies price ambivalence of secondary resources based on the model of a vertically integrated two-sector economy with resources and waste. It is shown that even for preferences, technology and waste damage function satisfying standard assumptions, in particular,monotonicity and convexity, both the efficient shadow price and the competitive equilibrium price of the secondary resource may be positive, zero or negative. Rigidities in the supply of the secondary resource, limits to substitution between the primary and the secondary resource, and costly disposal are identified as crucial for this result. Empirical evidence of price ambivalence comes from the German spot market for waste paper. © 2004 Elsevier B.V. All rights reserved.
AB - The paper studies price ambivalence of secondary resources based on the model of a vertically integrated two-sector economy with resources and waste. It is shown that even for preferences, technology and waste damage function satisfying standard assumptions, in particular,monotonicity and convexity, both the efficient shadow price and the competitive equilibrium price of the secondary resource may be positive, zero or negative. Rigidities in the supply of the secondary resource, limits to substitution between the primary and the secondary resource, and costly disposal are identified as crucial for this result. Empirical evidence of price ambivalence comes from the German spot market for waste paper. © 2004 Elsevier B.V. All rights reserved.
KW - Sustainability sciences, Management & Economics
KW - ambivalence
KW - costly disposal
KW - joint production
KW - limits to substitution
KW - primary and secondary resources
KW - waste paper
UR - http://www.scopus.com/inward/record.url?scp=7444236541&partnerID=8YFLogxK
UR - https://www.mendeley.com/catalogue/81803a0b-a9b9-37ec-b91f-384818d4c392/
U2 - 10.1016/j.resconrec.2004.04.013
DO - 10.1016/j.resconrec.2004.04.013
M3 - Journal articles
VL - 43
SP - 95
EP - 117
JO - Resources, Conservation and Recycling
JF - Resources, Conservation and Recycling
SN - 0921-3449
IS - 1
ER -