Improving Contractors’ Participation of Resource Utilization in Construction and Demolition Waste through Government Incentives and Punishments

This paper develops a simulation model for analyzing how government incentives and punishments improve contractors’ participation in resource utilization of construction and demolition waste (RUCDW) based on system dynamics theory. The construction industry’s long-term objective is to become more sustainable and resource-effective, and as part of this objective, generated construction and demolition waste should be recycled and resource utilized. However, most contractors have little willingness to engage in RUCDW because it increases their costs. The government thus plays a vital role in improving their participation in RUCDW through a range of educational tools such as advertisements, professional training, incentives, and punishments. Among these approaches, incentives and punishments are considered the most effective because they directly change project costs. We use the Vensim software package for numerical simulation and data collected from Suzhou, China are used to demonstrate and validate the developed model. Simulation results show that the government can improve contractors’ participation in RUCDW through three kinds of incentives and punishments: (1) subsidizing RUCDW; (2) increasing landfill fees; and 3) issuing fines for illegal dumping. Comprehensive application of multiple policies has a stronger effect than single policies. The established model is therefore a valuable tool for assessing the dynamic effects of government incentives and punishments on RUCDW ahead of implementation, which can provide guidance for policymakers.