Chris discusses the question of whether positive incentives would be better than fines as a way of encouraging household recycling. On the one hand, he reports, fines can backfire:

Aldo Rustichini and Uri Gneezy have shown that when they introduced fines for parents who were late to pick up their children from kindergartens in Haifa, parents actually got later. They regarded the fine as a price for baby-sitting. Likewise, fines for not recycling might be regarded as a price which households are happy to pay. So recycling might not increase.

And Chris then goes on to give four considerations in the other direction.

But I'm wondering if there can be a general answer to the question of carrots versus sticks. Surely it will depend (at least) on the size of the respective carrots and sticks being contemplated. There's going to be some point where those parents in Haifa are no longer prepared to treat the fine as a tax, because it's too high for them. Equally, if they were offered an incentive for arriving on time that was of less value to them than their reason for being late, that would be ineffective.

Another consideration has to do, not with the magnitude of the carrot or the stick, but with its appropriateness. A fine for murder, however hefty, wouldn't be right if there was anyone rich enough to regard it as a mere tax. And financial incentives to obey laws against murder and assault might also be frowned upon, given that we expect law-abidingness willy-nilly. A piece in G2 today suggests that to incentivize household recycling might actually encourage people to accumulate packaging and such when they shop, in order to make money out of it.

I don't know.