In developing countries, informalwaste-pickers (known as scavengers) play
an important role in solid waste management systems, acting in a parallel way to formal
waste collection and disposal agents. Scavengers collect, from the streets, dumpsites, or
landfills, re-usable and recyclable material that can be reincorporated into the economy's
production process. Despite the benefits that they generate to society, waste-pickers are
ignored when waste management policies are formulated. The purpose of this paper
is to integrate the role of scavengers in a dynamic model of production, consumption,
and recovery, and to show that, in an economy producing solid waste, efficiency can
be reached using a set of specific and complementary policies: a tax on virgin materials
use, a tax on consumption and disposal, and a subsidy to the recovery of material. A
numerical simulation is performed to evaluate the impact of these policies on landfill
lifetime and natural resource stocks. A discussion on the implementation of these instruments
is also included.