The Statistical Distributions of Industrial Wastes: an Analysis of the Japanese Establishment Linked Input-output Data

Abstract

Both waste management policies and the economic theories underlying them model the behaviour of a representative company or establishment using. For example, toxic wastes such as dioxin are regulated by the mean emission volume standard measured per Nm3, where the mean is estimated using data. As we will show, most establishments (particularly combustion plants) satisfy the required emission standard, while only a few exceed the regulation limit and must be checked by the authorities until regulation standards are met. But regulators must monitor all establishments incurring unnecessary costs. Fullerton and Kinnaman 1995, among other theoretical contributions, show that taxing downstream establishments can achieve the second best policy. (See also Walls & Palmer 1998, who discuss more general market conditions.) Recent research shows that regulating downstream establishments promotes research and development by firms in upstream stages of a supply chain under certain market conditions (Calcott & Walls, 2000; Greaker & Rosendahl, 2006). These theoretical implications are important for policy making about how to design a tax system, but these theories also assume a typical producer and the regulation standard with respect to their mean emissions of waste materials. In practice, however, even though the coefficients of variation for the distributions of heavy metals in fly ash found in municipal solid waste are known to reach 50% (Nakamura et al., 1997), little statistical evidence in the published literature exists on the variation in industrial establishments’ waste generation and reuse-recycling per unit production, which is basic information required for economic and ecological design and general policy decisions. In this paper we fill this gap in the literature and show the distributions of generation rates for various types of wastes and by-products in the production processes of establishments in Japanese manufacturing industries. We use the METI survey data (Survey on the Industrial Waste and By-Products, Japanese Ministry of Economy, Trade and Industry, 2005 and 2006). This survey gives the amounts of 37 types of industrial wastes generated for four different levels of the production processes (generation, intermediate reduction, reuse-recycle, and disposal to landfill) at 5048 establishments.1