Construction and Optimization of a Cost-Benefit Model for Waste Management Enterprises

The challenge of municipal solid waste (MSW) management is one of the central issues in the transition of both circular and sustainable economies, particularly in countries where the regional disparity and financial constraints influence the implementation of policies. The growing volumes of waste, the high costs of treatment, and disproportional distribution of landfills in comparison to the upkeep of recycling facilities contribute to waste inefficiency and contradict the European Union (EU) waste directives. Such a study uses a combined methodology framework in determining the economic, environmental, and policy implications of municipal waste management in 4,341 municipalities. We present a comprehensive comparison of recycling, landfilling, and energy-from-waste (EfW) approaches using descriptive statistics, cost-benefit analysis, regression models, and optimization methods. The evidence suggests that there is much heterogeneity of efficiency: the diseconomies of scale are in smaller cities, dumping in landfills has long-term environmental costs and short-run affordable costs, and recycling has high environmental and social costs, but higher financial costs. The population density, the institutions of governance, and the design of the collection systems are established to be key contributors to the cost efficiency through the application of regression analysis. The optimization situations also demonstrate that the financial viability and environmental performance can be significantly improved through the use of well-targeted measures such as subsidies, carbon pricing, and pay-as-you-throw schemes. This paper is the first national evidence base on the alignment of the municipal waste management in Italy with the EU circular economy objectives through multilevel analyses. Besides enlightening policymakers about the design of affordable, socially conscious waste regimes, these findings also give a model that can be replicated in other settings in evaluating the shift towards sustainability in Europe.