Insights from Circular Economy Literature: A Review of Extant Definitions and Unravelling Paths to Future Research

Omar Alhawari, Usama Awan, M. Khurrum S. Bhutta and M. Ali Ülkü
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Omar Alhawari: College of Business, Ohio University, Copeland Hall, Athens, OH 45701, USA
Usama Awan: Industrial Engineering and Management, The Lappeenranta-Lahti University of Technology LUT, P.O. Box 20, FI-53851 Lappeenranta, Finland
M. Khurrum S. Bhutta: College of Business, Ohio University, Copeland Hall, Athens, OH 45701, USA
M. Ali Ülkü: Centre for Research in Sustainable Supply Chain Analytics, Rowe School of Business, Dalhousie University, Halifax, NS B3H 4R2, Canada

Sustainability, 2021, vol. 13, issue 2, 1-22

Abstract: The circular economy (CE) has become one of the prominent topics in both natural science and management literature over the last few decades. CE is a dual-loop regenerative system that focuses on the effective and efficient utilization of resources in the ecosystem, which is beneficial to environmental and economic performance optimization. Dual CE initiatives allow firms to increased resource eco-efficiency, as well as resource effectiveness. CE has profound consequences for economic and operational advantage. This reinforces the need for reflection on the definition that may provide guidelines to assess and advance the depth and diversity of the field. We aim to provide a definitional analysis of the CE and suggest future research streams to advance the existing literature. For this purpose, we employed a systematic literature review to collect related publications in the CE. As a result of this, a total of 91 papers were selected, studied, and analyzed. We proposed a sound definition of a circular economy that includes the main identified elements, organizational planning processes, customers and society, utilization of the ecosystem, and economic resource flows. Moreover, future direction agenda, in CE research, is suggested considering three research streams: (1) circular design as value creation and capture, (2) antecedents of key activities, and (3) consequences of key processes. There is limited empirical research conducted on CE, and much of the existing research focuses on theoretical, conceptual, and normative. A few empirical research studies are mainly cross-sectional in their focus and are confined to developing and emerging economies. We hope this study’s findings will extend the field of CE, in which some of the most influential information regarding CE literature is provided. This study suggests that the development of CE initiatives plays an important role in the growing digital transformation in the value chain. There have been limited research studies in the interface of circular economy and Industry 4.0. Future research studies may investigate the extent to which digital transformation can increase the implementation of CE, and their influence on digital performance management.

Keywords: circular economy; ecosystem; circular design; value creation; digital performance (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (38)

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