What do circular innovator firms look like in Emilia- Romagna? A cluster analysis of firms innovating in the circular economy

Elisa Chioatto ()
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Elisa Chioatto: University of Ferrara

Economia Politica: Journal of Analytical and Institutional Economics, 2025, vol. 42, issue 2, No 4, 405-440

Abstract: Abstract Innovation is widely recognized as a key driver in the transition to a circular economy. However, empirical evidence on firm-level adoption of circular innovations remains limited, particularly when considering the heterogeneity among firms, sectors, and levels of knowledge capacity across different geographical regions. This study examines the characteristics of circular innovator firms in Emilia-Romagna, aiming to identify which firms are best positioned to capitalize on circular innovations and which face structural barriers. Using cluster analysis on a dataset of 1564 small and medium enterprises, the research categorizes firms based on their level of innovativeness, distinguishing between non-innovators, traditional innovators, and circular innovators. The findings reveal that the main clusters adopting traditional and circular innovations are both characterized by R&D investments and international market orientation. However, distinct patterns emerge regarding firm size: while larger firms tend to prioritize traditional innovation, smaller and younger firms exhibit a stronger propensity for adopting circular innovations.

Keywords: Circular innovation; Circular economy; Eco-Innovation; Regional economies; Small and medium enterprises (search for similar items in EconPapers)
JEL-codes: Q50 Q55 R10 (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s40888-025-00367-0

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