IT is easy to be an enthusiastic supporter of recycling, especially in Seattle. Recycling requires little effort from consumers and appears to eliminate waste and alleviate pressures on the environment. Recycling is an easy choice for those who believe it will always save money and resources. They have little problem equating it with conservation and making it a litmus test for green values.

But recycling is not always a wise idea. Like many good things it entails tradeoffs, tradeoffs that make its environmental effects ambiguous and dependent on local circumstances. Recycling consumes valuable labor, capital, time and urban space. It imposes environmental and economic costs through transportation, sorting, processing and remanufacturing and sometimes these costs outweigh the gains of reusing a resource. Without knowledge of the tradeoffs, a knowledge usually communicated through prices, it is difficult to make responsible decisions.

Lynn Scarlett of the Reason Foundation is someone who has studied the tradeoffs inherent to recycling. She analyzed seven of the best curbside recycling programs in the United States and found that the net cost was $110 per ton after subtracting an average salvage value of $35 per ton. These were the best cases. The average net cost for curbside recycling is about $150 to $200 per ton. Much of the gap between costs and value is a deadweight loss, a needless waste of resources.

However, Scarlett's results should not be taken to indicate that all recycling is inefficient and environmentally unfriendly. Some early losses in recycling can be investments in experiments that may ultimately pay off. The problem is that it is difficult to determine whether recycling a specific object, such as plastic soft drink bottles (Polyethylene Terephthalate, or P.E.T.), makes environmental sense. Like so many things in life, it depends.

One of the things on which it depends is our position on the recycling learning curve (i.e., how much we know about recycling an object). When producing any good, the first units are often quite expensive. For example, computing power used to be very expensive. The first computer, ENIAC, cost the U.S. government $3 million and delivered less computing power than a modern calculator. Today, the same computing power is available for roughly $30. This is the learning curve at its best - producing vastly better products at much lower prices. Though less dramatic, the same logic applies to recycling; the longer we recycle, the more efficient and effective we become.

Now this rule only applies when recycling programs generate incentives to innovate and learn. Plans that do not, like Germany's "green dot" program, are extremely wasteful. The German system mandates that firms must recycle a certain percentage of their products. Like many government plans, it makes recycling a burden rather than an opportunity and thereby discourages innovation. We can expect far better results from recycling efforts designed by producers and supported by consumers.

There are some attractive recycled products coming onto the market as firms ascend the learning curve. Patagonia, for example, has recently introduced a new Synchilla fleece. This fabric is 80 percent recycled fiber made from (P.E.T.) soda-pop bottles and 20 percent virgin polyester. It is slightly more expensive than the fabric it replaced and is not quite as soft. Nevertheless, people love the fleece and the idea behind it. Wholesalers have already sold out their fall stocks.

BMW presents another example with the planned introduction of the first 100 percent recyclable car and auto-recycling facility. Both firms are using profits from sales of existing products to subsidize the development of recyclable products. In doing so they are pushing the market up the recycling learning curve.

Efforts to recycle among firms producing luxury or high-end products offer an interesting dilemma. Although "Beamers" are often derided as yuppie toys and Patagonia satirized as "Patagucci," the customers and stockholders of these firms are subsidizing movement up the learning curve. Their efforts to commercialize recycling provide a significant public good.

As the technology pioneered by "luxury" firms advances and less-workable ideas are filtered out, the cost of producing recycled products decrease. (Today, P.E.T. is actually less expensive than virgin material for carpet fiber). This encourages wider use of recycled material. Firms serving larger markets, like WalMart and Costco, will ultimately feature recycled products as the most successful processes are refined.

Recycling can be environmentally harmful and economically wasteful. Unfortunately, these problems are most likely when politics intervenes and obscures the existence of tradeoffs. Politics can push recycling too hard by mandating trendy but harmful and inefficient programs, like recycled content mandates. These approaches stifle innovation and creativity. Although the market is by no means perfect, when prices approximate full costs, it provides the best path toward socially and environmentally responsible products.