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The Ecological Criteria of Circular Growth and the Rebound Risk of Closed Loops

Balint Horvath (), Miriam Bahna () and Csaba Fogarassy ()
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Balint Horvath: Climate Change Economics Research Centre, Szent István University, Páter Károly 1, 2100 Godollo, Hungary
Miriam Bahna: Doctoral School of Management and Business Administration, Szent István University, Páter Károly 1, 2100 Godollo, Hungary
Csaba Fogarassy: Climate Change Economics Research Centre, Szent István University, Páter Károly 1, 2100 Godollo, Hungary

Sustainability, 2019, vol. 11, issue 10, 1-15

Abstract: The implementation practices of the circular economy (CE) put a strong emphasis on preventing material losses in economic processes. The general interpretation of the concept focuses on closing technological and biological cycles by reintegrating end-of-life products into production and consumption systems. Thus, “closed loops” have become a trademark of circular transition. However, this limited perception fails to cover the essence of the CE. Besides closure, the utility of material loops can be prolonged, and a conscious consumer attitude may even prevent the creation of unnecessary material flows. This paper aims at proving that the preference of closed loops would result in deadweight losses in the long run. The conducted analysis ranks EU member states according to the most anticipated material flow indicators. Then, the study presents a new methodology to measure circular efficiency based on the available ecological capacity of the countries. The outcomes show that the poorly performing actors are in fact not far from a sustainable operation. Meanwhile, the countries with the most efficient material flow values present the widest development gap to reach the ideal level of circularity.

Keywords: circular growth; rebound effect; ecological footprint; circular indicators; closed loops (search for similar items in EconPapers)
JEL-codes: Q Q0 Q2 Q3 Q5 Q56 O13 (search for similar items in EconPapers)
Date: 2019
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