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Abstract: “The externalities of household waste generation and treatment can be internalized with Pay-As-You-Throw (PAYT) policies that price unsorted waste disposal. This paper estimates causal effects of PAYT on municipal wastes and analyzes the determinants of policy adoption and compliance. Empirically, I use a doubly robust random forest estimator on a unique high-dimensional panel with about 20,000 observations on Italian municipalities. Controlling for possibly endogenous adoption with a large set of covariates, results show that PAYT is on average effective, decreasing per capita unsorted waste up to -61%. Effects are mostly driven by an increase in recycling (40%). Both adoption and compliance are considerably heterogeneous, and explained by complex interactions of covariates. Targeting municipalities with low opportunity costs of recycling through, e.g., awareness-raising campaigns seems recommendable to achieve total waste reductions. Social costs savings are positive, and are predicted to increase if all municipalities were to introduce the policy.”