impact of circular economy

and economies and to ensure a level playing field, and to Introduction 2. Partners involved: Developments are already underway in the garment and footwear industry through the United Nations Economic Commission for Europe (UNECE) and United Nations Centre for Trade Facilitation and Electronic Business (UN/CEFACT) initiative, jointly implemented with the International Trade Centre (ITC) and support of the European Union. International trade and circular economy intersect in multiple areas. Provided by the Springer Nature SharedIt content-sharing initiative, https://doi.org/10.1007/s11135-023-01709-5, access via CE presents system characteristics that can benefit from a more comprehensive social Reusing, repurposing and recycling materials takes the pressure off of natural systems while reducing pollution The goal of this initiative is to lay the groundwork for a gradual introduction of a digital product passport in at least three key value chains by 2024, likely to include textiles, construction, industrial and electric vehicle batteries, and at least one other such as consumer electronics or packaging. The authors have no competing interests to declare that are relevant to the content of this article. WebChanging society towards greater sustainability - both societally and ecologically - and accelerating the transition to a circular economy, requires this change in the valorisation 29 French Commissariat gnral du dveloppement durable -Montarisation des biens, services et impacts environnementaux: la variabilit des valeurs montaires. Sex, drugs and the circular economy: The social impacts of the circular economy and how to measure them. In fact, re-manufacturing and it becomes possible but also of crucial importance to rethink Rue des Deux Eglises 14-16, B-1000 Brussels, Tel: +32 2 289 10 90 - E-mail: eeb@eeb.org, If you have a complaint, please study our complaints policy and contact us at complaints@eeb.org, EC register for interest representatives: Identification number 06798511314-27, International non-profit association - Association internationale sans but lucratif (AISBL), RPM Tribunal de lentreprise francophone de Bruxelles. Scaling up requires management discipline. 1. Int. As part of its investigations on Circular Economy, the European Environmental Bureau has commissioned a study to assess the impacts of EU-level 10(12), 48 (2006), Zink, T., Geyer, R.: Circular economy rebound. taxation and pricing. Google Scholar. This signals positive progress towards a more resilient and regenerative system. Without improvements in how clothing is made, cared for, and disposed of, apparels environmental impact will worsen. 155, 3645 (2019). and Recycl. : International Copper Study Group. Ph.D. Dissertation, Colorado School of Mines, Golden (2005). International trade and Specifically, compared with the eastern and central regions, the western region shows the greater untapped potential of the circular economy. This work was supported by the National Social Science Foundation of China (Grant No. The resource displacements show an overshoot and collapse behavior during the period 2025 and 2027. Tukker, A., Ekins, P.: Concepts fostering resource efficiency: A trade-off between ambitions and viability. Environ. Martins, N.O. Environ Sci Pollution Res Int 28(47):6691467669, Article https://doi.org/10.1007/s11356-022-21314-7, DOI: https://doi.org/10.1007/s11356-022-21314-7. : Business Dynamics: Systems Thinking and Modeling for a Complex World. visibility of material inputs, reverse logistics, and authentication enabling reuse. Recycl. Governments increasingly recognise the fundamental role of transparency and traceability of traded goods in empowering businesses and users to make more responsible choices that benefit the environment. Conserv. J. Building resilience: the impact of the circular economy on global trade and supply chains Mapping the impacts on multiple policy areas. of India. Thunderbird Int. the Value Added Tax (VAT) Accessed 27 Aug2021, Xi Y L, Niu G M (2021) An empirical study on the relationship between carbon emissions and economic growth: empirical evidence based on international panel data. Research on the impact of circular economy on total factor carbon productivity in China. 21(3), 593602 (2017), Zink, T., Geyer, R., Startz, R.: A market-based framework for quantifying displaced production from recycling or reuse. You can help us remain free and independant as well as to develop new ways to communicate science by becoming a Patron! J Technol Econ 29(12):6873, Jiang M H,An H Z,GaoX Y et al (2021) Structural decomposition analysis of global carbon emissions: the contributions of domestic and international input changes. ESG. There is a range of new research and frameworks for stakeholders to draw on, including IISD and Sitras report on incorporating circular economy provisions in regional trade agreements (RTAs), IEEP report and country level assessments, and the new Chatham House framework, which emphasises the need for a just and inclusive circular economy transition. system by integrating the cost of externalities would allow to National Acad. Econ. Crpin, A., Biggs, R., Polasky, S., Troell, M., Zeeuw, A.: Regime shifts and management. This summary is free and ad-free, as is all of our content. Energy Econ. When managing their sustainability performance, consumer companies often start with their own operations. While merchandise trade was increasing less rapidly than world GDP before 2020, trade in services was rising more rapidly, breaking a long-standing trend (since the pandemic, both trade in services and merchandise are still recovering to pre-pandemic levels, merchandise is picking up faster than service due to travel being included in services). Organ. A circular economy for food actively contributes to the regeneration of natural systems and a holistic understanding of how food and agriculture trade policies can nurture a circular economy transition, therefore, needs further exploration. Mod Manage Sci 8th edn 1325, Yan J L, Ran Q Y, Su X F et al (2020) Research on the effect of foreign trade on promoting carbon emission reduction. What are the main obstacles towards a circular economy? Conserv. based on panel spatial lag model analysis. The international trading system comprises many thousands of unilateral, bilateral, regional, and multilateral rules and agreements among more than two hundred nations. J. Potting, M. Hekkert, E. Worrell, A. Hanemaaijer. The circular economy: Moving from theory to practice, Scaling up requires management discipline, The circular economy: Moving from theory to practice, Sustainability & Resource Productivity Practice, Style thats sustainable: A new fast-fashion formula, Starting at the source: Sustainability in supply chains. A woman drinking bottled water. Ecol. The developed model is estimated using full information maximum likelihood estimation for the Indian copper industry. Learn more about Institutional subscriptions. and Recycl. Guo WX, Sun H (2020) Research on impact of environmental regulation and technical innovation on total factor carbon productivity: based on chinese provinces spatial panel data analysis. All authors read and approved the final manuscript. The authors declare no competing interests. Others are helping develop standards for garments that can be more easily reused or recycled, and investing in the development of new fibers that will lower the environmental effects of production. reform that would promote the use of secondary materials and European Business Review. REDISAs digitized product tagging improves recovery, which in turn allows manufacturers to design tires with less toxic materials. Social Impact Assessment of Circular Economy. Econ. Agricultural products make a significant share of this bilateral exchange, with fresh fruits, vegetables, and cereals being an important part. These policy areas include: Border measures like tariffs, export restrictions, and anti-dumping, Regulatory measures like standards, Extended Producer Responsibility (EPR) schemes,Sanitary and Phytosanitary (SPS) checks, and technical regulation, Economic incentives such as subsidies, Intellectual Property Rights (IPRs), and free allowances, Awareness-raising and capacity building, for example, the WTO Aid for Trade initiative or the agenda of UN Capacity Building Task Force on Trade, Environment and Development, Trade agreements, for example by strengthening the Trade and Sustainable Development (TSD) Chapters and also including provisions on circularity throughout the trade agreements. Clean. Simul. Most European industries can improve financial performance with specific actions to reconfigure product lifecycles. In recent years, McKinsey research has shown that the circular economyusing and reusing natural capital as efficiently as possible and finding value throughout the life cycles of finished productsis at least part of the answer.1 1.See, for example, Hanh Nguyen, Martin Stuchtey, and Markus Zils, Remaking the industrial economy, McKinsey Quarterly, February 2014; and Scott Nyquist, Matt Rogers, and Jonathan Woetzel, The future is now: How to win the resource revolution, McKinsey Quarterly, October 2016. 21, 6998 (1996), Gujarati, D.N., Porter, D.C., Gunasekar, S.: Basic Econometrics. J. 261(3), 94102 (1989), Fu, X., Ueland, S.M., Olivetti, E.: Econometric modeling of recycled copper supply. After consumers By clicking below, you agree that we may process your information in accordance with these terms.We use Mailchimp as our marketing platform. Price Theory Pract 11th edn 149152+184, Yang X, Li XP, Zhou DC (2015) Study on the difference and convergence of carbon productivity in chinese manufacturing. In Europe, the net benefit of applying circular-economy principles could be as much as 1.8 trillion annually by 2030. Integrating circular economy considerations into these areas will require revision of existing policies, innovation, and collaboration both across departments and portfolios, as well as between the private and the public sector. 86, 221235 (2013), King, C.W. sub-indicators on resource efficiency, including One survey found that 70% of the providers of circular economy services polled export these services to customers in other countries. Due to the late introduction of the concept of carbon productivity, only a few studies have preliminarily analyzed the impact of the overall development of circular economy on carbon productivity at the macro level, but they ignored the different impact of different dimensions of the circular economy indicator system on carbon productivity at the micro level. ICSG. Rockstrm, J., Steffen, W., Noone, K., Persson, A., Chapin, F.S., Lambin, E.F., Lenton, T.M., Scheffer, M., Folke, C., Schellnhuber, H.J., Nykvist, B., de Wit, C.A., Hughes, T., van der Leeuw, S., Rodhe, H., Sorlin, S., Snyder, P.K., Costanza, R., Svedin, U., Falkenmark, M., Karlberg, L., Corell, R.W., Fabry, V.J., Hansen, J., Walker, B., Liverman, D., Richardson, K., Crutzen, P., Foley, J.A. Exhibit 1 shows that most of the 28 industries we studied could adopt three to four of six potential circular-economy activities, improving performance and reducing costs accordingly. Rev. An assessment of material flows, waste production, and recycling in the European Union and the world in 2005. PubMedGoogle Scholar. Adapting for example in the E.U. and Tech. Sustainability impact. (2016). We develop and promote the idea of a circular economy, and work with business, academia, policymakers, and institutions to mobilise systems solutions at scale, globally. Circular economy plays an important role in carbon emissions reduction. Circularity lowers sourcing risks and costs, improves operational efficiencies, and opens the door to new products and market segments. Lovins, L.H., Lovins, A.B. 84, 1522 (2012), Desing, H., Brunner, D., Takacs, F., Nahrath, S., Frankenberger, K., Hischier, R.: A circular economy within the planetary boundaries: Towards a resource based, systemic approach. Correspondence to The earths resources are precious and finite. virgin materials than recycled ones. Environ. 175, 13 (2021), Benyus, J.M. Balagopal G. Menon. Econ. Building resilience: the impact of the circular economy on global trade and supply chains. Harvard Business Review. For a circular economy, supportive services, such as design, engineering, research and development, maintenance, and digital services, are just as important as merchandise and material trade. For the full article, see Starting at the source: Sustainability in supply chains, November 2016, by Anne-Titia Bov, a specialist in the So Paulo office, and Steven Swartz. Highlights New and systemic indicator formulated based on environmental value retention. ), there is volume29,pages 7878078794 (2022)Cite this article. Changing society towards greater Ecol. 156, 111 (2020), Wei, T.: A general equilibrium view of global rebound effects. 19(5), 765777 (2015), Hartley, K., Santen, R.V., Kirchherr, J.: Policies for transitioning towards a circular economy: Expectations from the European Union (EU). : A safe operating space for humanity. They also invest in infrastructure, including IT. However, trade in services and trade in agricultural products are two examples that go beyond this and are equally essential elements of circular economy trade. The circular economy provides a framework which allows governments and cities to realise many of A three-part series on the potential of emerging technologies. As trade agreements move into new areas, governments will often rely on knowledge and expertise from businesses to negotiate complex regulatory changes. Zink, T., Geyer, R., Startz, R.: Toward estimating displaced primary production from recycling: A case study of U.S. aluminum. NBER Working Pap NO. Impact of circular economy network building: resilience strategy to climate action Chun-Chien Lin, Yu-Chen Chang International Journal of Climate Change Strategies and Management ISSN: 1756-8692 Article publication date: 4 April 2023 Downloads 0 pdf (652 KB) Abstract 1. Heinrich, T.: Resource depletion, growth, collapse, and the measurement of capital. China Financial News Network.http://www.cfen.com.cn/dzb/dzb/page_2/201911/t20191119_3424831.html.Accessed 20 Aug2021, Shan H J (2008) Reestimating the capital stock of China:19522006. Econ. an updated comparison of the limits to growth with historical data. The benefits of a circular economy are clear and trade negotiators have therefore turned their attention to its application. a society or other partner) holds exclusive rights to this article under a publishing agreement with the author(s) or other rightsholder(s); author self-archiving of the accepted manuscript version of this article is solely governed by the terms of such publishing agreement and applicable law. Posted on July 3, 2023 In this new world of sustainability and innovation, eco-consciousness meets strategic thinking. : Industrial ecology: goals and definitions, in: Ayres, R.U., Ayres, L. In a circular economy, more of this material would be used again in some form. Econ. North Point Press, New York, USA (2002), Meadows, D.H., Meadows, D.L., Randers, J., Behrens, W.W.I. Recycl. J. J. Econ. conventions in order to allow comparability between industries Brada, J.C.: The distribution of income between labor and capital is not stable: But why is that so and why does it matter? Statistika. Ecol Econ 4th edn 7174, Lu Z N, Yang Y, Wang J (2014) Factor decomposition of carbon productivity chang in China's main industries: based on the laspeyres decomposition method. The Policy 32, 183190 (2007). It not only reduces the environmental impact of products but also promotes responsible consumer The circular economy puts a big focus on services, maintenance, and refurbishment of assets. 18BGL183) and the Social Science Foundation of Beijing (Grant No. International trade encompasses multiple actors and agreements that are tangled and overlapping, which has led analysts to label the trade regime a spaghetti bowl of agreements. A woman drinking bottled water. This is a preview of subscription content, access via Int. and Recycl. 3. Energy Policy 131(131), Gao G, Wang K, Zhang C et al (2019) Synergistic effects of environmental regulations on carbon productivity growth in Chinas major industrial sectors. J. Accessed 19 April 2021. 145, 3845 (2018), Matos, F.J.F., Silva, F.J.F. 28 Not to speak about social externalities Springer Neth 95(12). non-renewable resources. But creating a circular business isnt simple. The circular economy could be the new way of thinking needed to reverse the damaging effects of climate change . Understanding how policymakers can encourage and promote trade in services through different policy levers will be needed. It remains nowadays that, while the price of a consumer good Other trade negotiations have focused on the circular economy as a means to keep materials in use, such as the EU-Vietnam Free Trade Agreement provision for remanufactured goods. Prod. Environ. Sci. 64(2), 114 (1974), Sraffa, P.: Production of Commodities by Means of Commodities: Prelude to a Critique of Economic Theory. Edward Elgar Publishing. sustainability - both J Cleaner Prod 165(165), Zaidi S A H, Hussain M, uz Zaman Q (2021) Dynamic linkages between financial inclusion and carbon emissions: Evidence from selected OECD countries. ESG. Ecol. The global consumer sector is expected to grow 5 percent a year for the next two decades. Additionally, they can be used to further advance the knowledge and understanding of what diverse, lower-impact and upcycled ingredients can mean in practice. We stated that Gartner is predicting that 80% of hardware vendors product portfolio will be linked to circular initiatives by 2030, up from 20% in 2023. : Natural capitalism: Path to sustainability? J. Ind. 96(3), 4764 (2016), Asif, F.M.A., Rashid, A., Bianchi, C., Nicolescu, C.M. Ecol. How to create a circular economy and what are the benefits foreseen? Thats where your shopping habits make an impact. To move society towards sustainability both socially and ecologically and accelerate the transition to a circular economy, would however require such a tax shift. Int. It is relevant to trade in services, trade in food products, trade in second-hand goods, trade in goods for refurbishment and remanufacturing, trade in materials for recycling, and trade in secondary raw materials, among others. In 2015, as part of a major study with the Ellen MacArthur Foundation, we demonstrated that such an approach could boost Europes resource productivity by 3 percent by 2030, generating cost savings of 600 billion a year and 1.8 trillion more in other economic benefits. increase the resilience and adaptability of supply chains. Develop. Meanwhile, the proposed indices demonstrate varying effects, with the resource efficiency indices outperforming the economic efficiency indices. From protecting human health to better jobs, the circular economy offers benefits beyond just the environment. Smaller-scale interventions can allow governments and businesses to demonstrate circular principles in action identifying challenges, building consensus, and attracting investments. Palgrave Macmillan, New York (2010). https://hbr.org/2016/02/how-businesses-can-support-a-circular-economy. COM 614 (2015). Clean. What are the indicators of progress toward a more circular economy? Accessed 14 March 2021. The world is less and less circular - but these The present research does not involve or utilize any Human Participants and/or Animals. For more information about our privacy practices please visit our website. The existing frameworks can offer an initial structure and help both public and private actors embed circular economy considerations in trade agreements and trade-related policies. and consumption of materials and fossil energies and other Zink, T., Maker, F., Geyer, R., Amirtharajah, R., Akella, V.: Comparative life cycle assessment of smartphone reuse: Repurposing vs. refurbishment. However, the beginnings of change are starting to happen. The role of the rebound effect. Resour. J. Can a more circular economy be economically profitable? 145, 7589 (2018), Keen, S.: A monetary Minsky model of the Great Moderation and the Great Recession. If material is not included in the articles Creative Commons licence and your intended use is not permitted by statutory regulation or exceeds the permitted use, you will need to obtain permission directly from the copyright holder. The earths resources are precious and finite. Home What we offer Browse our areas of investment and support Circular economy theme Area of investment and support Circular economy theme The EPSRC circular economy theme aims to support and drive research and innovation relevant to the transition to a circular economy across the councils remit. Conserv. By using this website you agree to our. Ellen Macarthur Foundation. societally and ecologically - and accelerating the transition to Trade policies, agreements and international cooperation funding can be significant instruments to stimulate and incentivise more regenerative agricultural production while strengthening partnerships and commitments between countries. The same principle works for electronic waste: shifting from small-scale recycling to best smelting processes or liquid-chemical extraction techniques multiplies yields. As part of the initiative, UNECE has been exploring the role of blockchain technology for end-to-end traceability in global textile and leather value chains.

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