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Every year, millions of tons of materials are being exploited from the earth's crust, and processed into consumer and capital goods. After decades to centuries, most of these materials are "lost". With the exception of some pieces of art or religious relics, they are no longer engaged in the consumption process. Where are they? Recycling is only an intermediate solution for such materials, although it does prolong the residence time in the anthroposphere. For thermodynamic reasons, however, recycling cannot prevent the final need for an ultimate sink.

However, comparing the market cost of recyclable material with the cost of new raw materials ignores economic externalities—the costs that are currently not counted by the market. Creating a new piece of plastic, for instance, may cause more pollution and be less sustainable than recycling a similar piece of plastic, but these factors will not be counted in market cost. A life cycle assessment can be used to determine the levels of externalities and decide whether the recycling may be worthwhile despite unfavorable market costs. Alternatively, legal means (such as a carbon tax) can be used to bring externalities into the market, so that the market cost of the material becomes close to the true cost.

Economist Steven Landsburg has suggested that the sole benefit of reducing landfill space is trumped by the energy needed and resulting pollution from the recycling process. Others, however, have calculated through life cycle assessment that producing recycled paper uses less energy and water than harvesting, pulping, processing, and transporting virgin trees. When less recycled paper is used, additional energy is needed to create and maintain farmed forests until these forests are as self-sustainable as virgin forests.

However, comparing the market cost of recyclable material with the cost of new raw materials ignores economic externalities—the costs that are currently not counted by the market. Creating a new piece of plastic, for instance, may cause more pollution and be less sustainable than recycling a similar piece of plastic, but these factors will not be counted in market cost. A life cycle assessment can be used to determine the levels of externalities and decide whether the recycling may be worthwhile despite unfavorable market costs. Alternatively, legal means (such as a carbon tax) can be used to bring externalities into the market, so that the market cost of the material becomes close to the true cost.

It is difficult to determine the amount of energy consumed or produced in waste disposal processes in broader ecological terms, where causal relations dissipate into complex networks of material and energy flow. For example, "cities do not follow all the strategies of ecosystem development. Biogeochemical paths become fairly straight relative to wild ecosystems, with very reduced recycling, resulting in large flows of waste and low total energy efficiencies. By contrast, in wild ecosystems, one population’s wastes are another population’s resources, and succession results in efficient exploitation of available resources. However, even modernized cities may still be in the earliest stages of a succession that may take centuries or millennia to complete.":720 How much energy is used in recycling also depends on the type of material being recycled and the process used to do so. Aluminium is generally agreed to use far less energy when recycled rather than being produced from scratch. The EPA states that "recycling aluminum cans, for example, saves 95 percent of the energy required to make the same amount of aluminum from its virgin source, bauxite." In 2009 more than half of all aluminium cans produced came from recycled aluminium.

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