Construction and demolition waste (C&DW) recycling forms the prime focus of this paper. Drawing on evidence from data collected by the authors in Ireland, the paper develops a model to assess the economic viability of creating markets for recycled C&DW. Currently, most of the waste generated in construction and demolition sites is composed of materials such as concrete, bricks and blocks which are disposed of in landfill sites due to the absence of markets for their recycled forms. The model developed in this paper is based on the potential decisions facing the waste producer and the aggregate user. Once the model is developed and the underlying assumptions outlined and analysed, the paper then proceeds to assess the impact of the imposition of environmental taxes and the use of subsidies on the economics of C&DW recycling. The paper proposes the establishment of three potential Irish recycling centres located in Dublin, Limerick and a mobile centre. Conclusions are presented which suggest that economic viability is likely to occur when the cost of landfilling exceeds the cost of bringing the waste to the recycling centre and the cost of using primary aggregates exceeds the cost of using recycled aggregates. The paper also clearly demonstrates that recycling centres benefit from economies of scale implying that an increase in the scale of a centre, in turn results in a decrease in recycling costs. The overriding conclusion of the paper is that market based instruments are likely to be the best option for policy makers. While the model presented is 'tested' on real data derived from surveys with Irish local authorities (responsible for waste management in the Republic of Ireland (ROI)) and aggregate producers, the underlying methodology of the model developed is clear and has a wider international applicability and relevance to the study of C&DW. (c) 2005 Elsevier B.V. All rights reserved.