Abstract: The household waste in Shanghai has increased dramatically in recent years, which greatly outran the capacity of disposal and has seriously polluted environment, so it is necessary to make efforts to reduce the generation of household wastes. Therefore, social production sectors are classified into four categories and the equilibrium model of supply and demand is developed. Through applying the 2012 data of Shanghai into the equilibrium model, it can be concluded that the unit-based pricing system is more effective than the flat fee system in the city of Shanghai. Moreover, the charge system with waste classification is more effective. As a result, the unit-based pricing system and classification system of household waste should be implemented step by step in Shanghai and be supported by increasing government financial input.