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Behavioural and mainstream environmental economics have proposed alternative explanations for individual motivations behind environmentally relevant activities, leading to different recommendations for policymakers. Separate collection of different types of municipal waste represents a popular field of application. In this paper, we exploit the results of a choice experiment study conducted on a representative sample of 1010 Italian households, aimed at understanding the relative weights of economic and non-economic motivations. The results show that the mean willingness to pay for separate waste collection is V77/year per family, which is an adequate empirical estimate of the warm glow effect of recycling. However, the four identified latent classes reveal individuals with fairly opposite motivations. This finding can be interpreted as the fact that the two types of motivations (economic and noneconomic) do not add up but tend to cancel each other. The concept of latent classes applied to environmental economics is novel and suggests distinct typologies of individuals. More importantly, these groups of individuals are likely to react differently to alternative policy instruments. Therefore, instead of designing waste management policies based on the assumption that behavioural responses are stereotyped, policymakers should adopt a more complex set of policy instruments that target different groups of individuals, with appropriately chosen incentive schemes.

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