How to successfully apply industrial symbiosis

Limor Hatsor () and Artyom Jelnov

MPRA Paper from University Library of Munich, Germany

Abstract: The premise of industrial symbiosis (IS) is that advancing a circular economy that reuses byproducts as inputs in production is valuable for the environment. We challenge this premise in a simple model. Ceteris paribus, IS is an environmentally friendly approach; however, implementing IS may introduce increased pollution into the market equilibrium. The reason for this is that producers’ incentives for recycling can be triggered by the income gained from selling recycled waste in the secondary market, and thereby may not align with environmental protection. That is, producers may boost production (and subsequent pollution) to sell byproducts without internalizing the pollution emitted in the primary industry or the recycling process. We compare the market solution to the social optimum and identify a key technology parameter (the share of reused byproducts) that may have mutual benefits for firms, consumers, and the environment.

Keywords: circular economics; industrial symbiosis; pollution; environmental policy (search for similar items in EconPapers)
JEL-codes: L11 Q5 Q52 Q53 (search for similar items in EconPapers)
Date: 2024
New Economics Papers: this item is included in nep-ene and nep-env
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://mpra.ub.uni-muenchen.de/122612/1/MPRA_paper_122612.pdf original version (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:122612

Access Statistics for this paper

More papers in MPRA Paper from University Library of Munich, Germany Ludwigstraße 33, D-80539 Munich, Germany. Contact information at EDIRC.
Bibliographic data for series maintained by Joachim Winter ().