Abstract
Purpose. The paper proposes a new trajectory of institutional change that integrates economic (fiscal) and technical solutions in managing municipal waste.
 Methodology / approach. The study adopts a model for the study of institutional change. A retrospective, quantitative analysis of institutional change, a legal-historical analysis of formal institutions, and a comparative-institutional analysis are used to substantiate the link between municipal waste quantities and Gross domestic product (GDP) growth. Using correlation and regression analysis, we examine the relationship between institutional change in municipal waste management and recycling.
 Results. The study proves the impact of institutional change on municipal waste management in the EU and Bulgaria. It can change the relationship between GDP and the amount of waste and stimulate the implementation of more efficient and innovative waste management methods. The relationship between institutional change in municipal waste management are studied. The main idea is that more legal acts regulating municipal waste management and a higher human development index, wich reflects better and more efficient municipal waste management, will lead to higher recycling rates. The study discusses how institutional change aimed at effective municipal waste management can contribute to increased revenues and reduced costs for the government by promoting innovation in the sector, introducing more efficient waste collection and treatment technologies, and encouraging recycling.
 Originality / scientific novelty. The study highlights the lack of a unified direction in rules and policies for municipal waste management in Bulgaria and its impact on the system’s efficiency. It aims to present a new approach to solving the problems related to municipal waste management in Bulgaria that focuses on the importance of institutional change.
 Practical value / implications. The paper identifies differences between the municipal waste management systems in the EU and Bulgaria. The proposed financial and technical solutions help central and municipal administrations to create new institutions. These actions can be joint and better coordinated. All this should lead to changes in the regulatory framework. The new rules will contribute to stability and less need to change regulations, clarity for individuals and organisations to the optimal solutions for reducing municipal waste costs, and “pressure” on the central and local administration to take the necessary actions for such a change.
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