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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.

In a 1996 article for The New York Times, John Tierney argued that it costs more money to recycle the trash of New York City than it does to dispose of it in a landfill. Tierney argued that the recycling process employs people to do the additional waste disposal, sorting, inspecting, and many fees are often charged because the processing costs used to make the end product are often more than the profit from its sale.[59] Tierney also referenced a study conducted by the Solid Waste Association of North America (SWANA) that found in the six communities involved in the study, "all but one of the curbside recycling programs, and all the composting operations and waste-to-energy incinerators, increased the cost of waste disposal."

For a recycling program to work, having a large, stable supply of recyclable material is crucial. Three legislative options have been used to create such a supply: mandatory recycling collection, container deposit legislation, and refuse bans. Mandatory collection laws set recycling targets for cities to aim for, usually in the form that a certain percentage of a material must be diverted from the city's waste stream by a target date. The city is then responsible for working to meet this target.

Beverage bottles were recycled with a refundable deposit at some drink manufacturers in Great Britain and Ireland around 1800, notably Schweppes. An official recycling system with refundable deposits was established in Sweden for bottles in 1884 and aluminium beverage cans in 1982, by law, leading to a recycling rate for beverage containers of 84–99 percent depending on type, and average use of a glass bottle is over 20 refills.

 

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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