Abstract
Large amounts of e-waste are processed “informally” in lower income countries. Such processing releases dangerous pollutants, which increase mortality and reduce cognitive functioning. This paper estimates the social cost of informal e-waste processing in Southern China. This parameter may be “plugged-in” to cost-benefit analyses that evaluate the economic efficiency of policies to reduce informal e-waste processing in China or other lower income countries. It may also be used in the estimation of the social benefits (or costs) of new or proposed e-waste processing policies in higher income countries. We estimate that the social cost of informal e-waste processing in Guiyu is about $529 million. This amount is equivalent to about $423 per tonne (in 2018 US dollars) or $3528 per person, which is over half the gross income per capita of the residents of Guiyu. We also perform sensitivity analysis that varies the estimated mortality outcomes, the value of a statistical life and the amount of e-waste processed.
Highlights
Economists and policy analysts argue that a primary goal of government policies or programs should be to increase economic efficiency, called allocative efficiency (Boardman et al 2018).programs should be evaluated in terms of their net social benefits, that is, the net benefit to society as a whole
In order to derive the social cost of informal e-waste processing (SCIEWP), we focus on e-waste processing in Guiyu, a town in Guangdong province
This paper focuses on pollutants that are ubiquitous in the recycling process and probably have the largest impact on health and mortality: lead, dioxins and furans as well as particulate matter
Summary
Economists and policy analysts argue that a primary goal of government policies or programs should be to increase economic efficiency, called allocative efficiency (Boardman et al 2018). In terms of dollars per tonne (1000 kg) of e-waste processed and in terms of dollars per person Estimating this shadow price is important because, as we discuss, the amount of e-waste is growing rapidly. The second step, which is discussed, estimates the impact of informal e-waste processing on mortality. The third step, which is discussed, is to estimate the social cost of e-waste processing in Guiyu. Our estimate of the social cost per tonne is still likely to be applicable in the evaluation of policies pertaining to areas where informal e-waste processing is similar to the conditions that existed in Guiyu in about 2010.
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