Advancing to a Circular Economy: three essential ingredients for a comprehensive policy mix

Abstract

Material resources exploitation and the pressure on natural ecosystems have raised concerns over potential future resource risks and supply failures worldwide. Interest in the concept of Circular Economy has surged in recent years among policy makers and business actors. An increasing amount of literature touches upon the conceptualisation of Circular Economy, the development of ‘circular solutions’ and circular business models, and policies for a Circular Economy. However, relevant studies on resource efficiency policies mostly utilise a case-by-case or sector-by-sector approach and do not consider the systemic interdependencies of the underlying operational policy framework. In this contribution, a mapping of the existing resource policy framework in the European Union (EU) is undertaken, and used as a basis for identifying policy areas that have been less prominent in influencing material resource efficiency. Employing a life cycle approach, policies affecting material efficiency in the production and consumption stages of a product have been found to be poorly utilised so far in the EU. Taking this as a point of departure, three policy areas that can contribute to closing material loops and increasing resource efficiency are thoroughly discussed and their application challenges are highlighted. The three policy areas are: (1) policies for reuse, repair and remanufacturing; (2) green public procurement and innovation procurement; and (3) policies for improving secondary materials markets. Finally, a potential policy mix, including policy instruments from the three mentioned policy areas—together with policy mixing principles—is presented to outline a possible pathway for transitioning to Circular Economy policy making.