Trust, Leadership, and Money Incentives and the Promotion of Participation in Community-Based Recycling Activity: Which One Works?

by Alin Halimatussadiah, Diah Widyawati, and Shanty Syahril

This study tested the significance of the following factors in promoting participation in waste bank activity: (1) trust in a community member, (2) the leadership of a waste bank administrator, and (3) economic incentives. Estimation results showed that the willingness of households to join a waste bank depends on their pro-social behavior, which is reflected on the contributions they make to a public goods game (conducted as part of this research project). Pro-social behavior also induces sorting behavior. Waste bank members tend to conduct more waste sorting than nonmembers. This evidence shows that the waste bank program is important in encouraging waste sorting. The authors also found that leadership and economic incentives induce positive participation in waste bank activity. However, the authors were unable to find any relationship between trust and participation. The waste bank leader acts to create a market for recyclable scraps, generating an economic incentive to participate. Economic incentives work well and could be adapted by the government to expand recycling activity.

  • Publication Year: 2016
  • Country: Indonesia
  • Research Area: Behavioral Economics and Social Capital
  • Research Topic: Cooperative Behavior, Public Good and Trust
  • Analytical Framework: Behavioral/Experimental Economics
Economy and Environment Program for Southeast Asia