Social norms and tariff salience: An experimental study on household waste management

Abstract

We study the introduction of a social information program on waste disposal in a setting characterized by a two-part tariff. Households pay for unsorted waste a fixed amount if their yearly disposal is below a pre-defined cap, and pay per disposal after exceeding the cap. We randomize the receipt of a social information intervention, where customers’ disposal is compared to that of similar ones. An additional treatment couples the social comparison with information on the customer’s distance from the cap. We find that the report containing the social norm alone leads to a 5% reduction in the volume of unsorted waste. Making the cap salient significantly reduces the effectiveness of the social norm. The two treatments have a similar negative effect on the likelihood of exceeding the disposal cap. The reduction in unsorted waste is partly achieved through an increase in waste sorting, and is not accompanied by higher illegal disposals or lower quality of sorted waste. Our results confirm the effectiveness of descriptive norms in coordinating behavior but indicate that providing information on economic incentives can permanently crowd out their effect.