Arranz, C.F.A, Kwong, C. and Sena, V. (2023) The effect of consumption and production policies on circular economy business models: a machine learning approach. Journal of Industrial Ecology, 38 (8). pp. 1493-1502. ISSN 1088-1980
Abstract
The circular economy (CE) is attracting increasing interest, as it can bring environmental, social, and economic benefits. However, policymakers and scholars appear to concentrate more on the production side of CE, while consumption, and particularly policies that affect consumption have received less attention and their effect is ambiguous. This paper investigates the effect of CE consumption policies on circular economy business models (CEBMs) in firms, but also examines the interplay this type of policies have with CE production policies to have a broader picture of the circular economy policy framework and the relevance of each type of policy on firms. While previous studies assume rational and passive consumer behavior, this paper borrows from a natural resource-based view and stakeholder theory, arguing that consumers have a proactive attitude toward the consumption of environmentally friendly products. Moreover, we use institutional theory as an analytical framework for modeling the effects of a particular policy framework on the CEBM. Our analysis combines classical econometric methods with machine learning approaches, employing data from the EU. The results show that CE policies aimed at promoting consumption have a direct and positive effect on CEBMs. This paper also confirms that a wide portfolio of CE policies on production and consumption has a greater effect on the development of CEBMs, due to the complementarity of CE consumption and production policies. Moreover, we show that in interaction with CE production policies, CE policies on consumption have an even greater effect on CEBMs in firms than would have been anticipated.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © 2023 The Authors. Journal of Industrial Ecology published by Wiley Periodicals LLC on behalf of International Society for Industrial Ecology. This is an open access article under the terms of the Creative Commons Attribution License, (http://creativecommons.org/licenses/by/4.0/) which permits use, distribution and reproduction in any medium, provided the original work is properly cited. |
Keywords: | Circular Economy; Consumption Policy; Machine Learning; ANN; K-means Cluster; Industrial Ecology |
Dates: |
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Institution: | The University of Sheffield |
Academic Units: | The University of Sheffield > Faculty of Social Sciences (Sheffield) > Management School (Sheffield) |
Funding Information: | Funder Grant number ECONOMIC & SOCIAL RESEARCH COUNCIL ES/W007231/1 |
Depositing User: | Symplectic Sheffield |
Date Deposited: | 10 Mar 2023 17:09 |
Last Modified: | 03 Oct 2024 15:51 |
Status: | Published |
Publisher: | Wiley |
Refereed: | Yes |
Identification Number: | 10.1111/jiec.13397 |
Related URLs: | |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:197205 |