Social‐Optimal Household Food Waste: Taxes and Government Incentives

11 Pages Posted: 16 Apr 2020

See all articles by Bhagyashree Katare

Bhagyashree Katare

Purdue University

Dmytro Serebrennikov

affiliation not provided to SSRN

H. Holly Wang

Purdue University - Department of Agricultural Economics

Michael Wetzstein

Purdue University

Date Written: March 2017

Abstract

In 2010, 21% of the total food available for consumption in the United States was wasted at the household level. In response to this waste, a number of counties and U.S. localities have instituted policies (disposal taxes) directed toward reducing this waste. However, currently there is no federal food‐waste disposal tax. The aim of this paper is to establish a theoretical foundation for household food waste, and based on this theory, to determine the social‐optimal food‐waste (disposal) tax, along with a government incentive. The theory unravels the interrelation between social food insecurity and external environmental costs, which is not generally considered by households when they waste food. A social‐optimal disposal tax and government incentive involve Pigovian mechanisms and governmental expenditures. For a zero level of food waste, the social‐optimal disposable tax and government incentive approach infinity.

Keywords: Externalities, food insecurity, food waste, social welfare, sustainability

Suggested Citation

Katare, Bhagyashree and Serebrennikov, Dmytro and Wang, H. Holly and Wetzstein, Michael, Social‐Optimal Household Food Waste: Taxes and Government Incentives (March 2017). American Journal of Agricultural Economics, Vol. 99, Issue 2, pp. 499-509, 2017, Available at SSRN: https://ssrn.com/abstract=3577061 or http://dx.doi.org/10.1093/ajae/aaw114

Bhagyashree Katare (Contact Author)

Purdue University ( email )

610 Purdue Mall
West Lafayette, IN 47907
United States

Dmytro Serebrennikov

affiliation not provided to SSRN

No Address Available

H. Holly Wang

Purdue University - Department of Agricultural Economics

West Lafayette, IN 47907-1145
United States

Michael Wetzstein

Purdue University

610 Purdue Mall
West Lafayette, IN 47907
United States

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