Understanding the Circular Economy: Overview of the Issues

Gustavo Ferro

No 809, CEMA Working Papers: Serie Documentos de Trabajo. from Universidad del CEMA

Abstract: Abstract: This essay tries to synthesize a recent discussion on circular economics, aiming to clarify the concept, its relationship with the notion of “decoupling”, and how technology, business, and economic policy influence it. In essence, circular economy means turning waste into something valuable. The concept encompasses some previous notions, such as bioeconomy. Technology of Fourth Industrial Revolution helps to decoupling growth from resource use. The reach of decoupling is disparate between growth optimistic and growth pessimistic thinkers. Business models comprehended in circular economy vary from eliminating waste, maximizing use extension of capital and durable consumption goods, until recovering materials and energy from process and products, turning goods into services by sharing, and replacing property by lease or pay-per-use models. Policies to induce or incentivize circular economy includes fiscal incentives through taxation and subsidization, command and control measures, and voluntary coordination efforts at the international level. / Resumen: Este ensayo procura sintetizar una discusión reciente sobre la economía circular, apuntando a clarificar ese concepto, su relación con la noción de “desacople” y cómo es influenciada por la tecnología, los negocios y la política pública. En esencia, la economía circular significa tornar desperdicios en algo valioso. El concepto abarca y supera algunas nociones previas como bioeconomía. La tecnología de la Cuarta Revolución Industrial aporta al desacople entre el crecimiento y los recursos. El alcance del desacople enfrenta a los optimistas con los pesimistas del crecimiento. Los modelos circulares de negocios incluyen eliminar desperdicio, maximizar la vida útil de los bienes durables, recuperar materiales y energía de procesos y productos, transformar bienes en servicios a través de su uso compartido y reemplazar su propiedad por alquiler o pago por el uso. Las políticas para inducir o incentivar la economía circular incluyen medidas fiscales, regulatorias y esfuerzos internacionales de coordinación voluntaria.

Keywords: Circular economy; Fourth Industrial Revolution; Business; Public policy (search for similar items in EconPapers)
JEL-codes: Q20 Q50 (search for similar items in EconPapers)
Pages: 15 pages
Date: 2021-09
New Economics Papers: this item is included in nep-env and nep-isf
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Persistent link: https://EconPapers.repec.org/RePEc:cem:doctra:809

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