Landfill commands high profits because, once it has its licenses and planning permission, it can command monopoly rent. This explains the economic dynamic of the waste sector, with a concentration of ownership of landfill sites and competition for low-value municipal collection contracts. Landfill, at the bottom of the environmental hierarchy, is most profitable, while recycling produces the poorest market returns. It is not surprising, then, that recycling rates remain so low. The main problem is institutional.
Collection is seen as a contributory stream to corporate strategies centered on disposal.
The industry's roots have shaped its institutional and professional culture. We should expect this kind of organization to have difficulty redesigning themselves around intensive recycling, which requires the skills of a modern retailer rather than those of a transporter of aggregates. Large-scale facilities appear easier to control and are more predictable in their cost than lots of different schemes. The overall result is that it is hard to integrate innovative collection strategies with disposal systems. They often find themselves challenged by the 'open systems' culture required for effective recycling.