Reconciling Circularity and Growth: The Model of Qualitative Economic Growth

Sergio Focardi and Frank J. Fabozzi
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Sergio Focardi: DIME, University of Genoa, Genoa, Italy
Frank J. Fabozzi: Carey Business School, Johns Hopkins University, Maryland, USA

Journal of Economic Analysis, 2025, vol. 4, issue 2, 178-198

Abstract: In response to the twin environmental crises of climate change and resource depletion, the circular economy has emerged as a key strategy to reduce waste, minimize the extraction of virgin materials, and promote reuse, repair, and recycling. However, the circular economy, as currently conceived, does not inherently support continuous economic growth in the conventional sense. At the same time, modern societies — grounded in ideals of progress, innovation, and rising living standards — rely on economic growth to sustain social stability, employment, and investment. In this paper, Focardi and Fabozzi argue that integrating qualitative economic growth with circularity offers a viable pathway to decoupling economic progress from the depletion of natural resources. Qualitative growth refers to economic progress driven by increased quality, functionality, and complexity of products, services, infrastructure, and institutions rather than the sheer output volume. To illustrate how qualitative growth and circularity can complement each other in practice, the paper highlights initiatives in Ljubljana, Slovenia, Vitoria-Gasteiz, Spain, and Amsterdam, Netherlands, where circular economy strategies have been combined with urban greening, infrastructure regeneration, and resource-efficient policies to enhance both environmental sustainability and quality of life.

Keywords: Circular Economy; Qualitative Growth; Economic Complexity; Sustainability; Decoupling of Economic Growth from the Use of Natural Resources (search for similar items in EconPapers)
Date: 2025
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