Abstract
The European Union (EU) remains one of the leading-edge jurisdictions on the planet in legislating and enforcing the circular economy, a token of its forthright environmental awareness. Still, given that the level of economic development across the EU member states is heterogenous, this concern, however generous it may be, looks too beyond “their” means and too ahead of “its” times. What the European policymakers seem to disregard is that top-down institutional constructions, as is the case with the EU’s overambitious environmental legislation, can end up in severe distortions. Imposing/importing an institutionalized arrangement without due preparation may fuel resistance to (even positive) change, as the biases it engenders translate into considerable costs and selective benefits. The present article attempts a novel approach within the literature, where the failure to achieve recycling targets is usually considered the fault of private businesses. Instead, our study explains suboptimal environmental results by the institutionalization of spiraling governmental interventions in markets, meant to make the arbitrarily set recycling/reuse targets artificially viable. Subject to EU rules, Romania’s packaging waste recycling market is a textbook case in revealing this outcome predicted by economic theory, as our statistical data suggest. The conclusion is that it is equally perilous to neglect the calibration of legislative targets according to institutional and economic development as it is to reject environmental claims based on their costs.
Highlights
The theoretical and applied dimensions pertaining to sustainable development, as to the whole sustainability science, are relatively delicate, given the fact that one can count a few hundred definitions that are attached to the core concept [1], with all this variety not necessarily contributing to clarity [2]
Are all member states able to create or, in the case of European Union (EU) regulation, enforce and respect, the environmental directives imposed? We argue that the degree of compliance with EU environmental regulation is strongly influenced by the development level of a country, and the lack of compliance that we currently witness is attributed to a mismatch between the levels of economic development of the member states and the EU’s bureaucratically set targets
After we explain the link between institutions and circularity, we review the legal framework devoted to circular economy in the European Union
Summary
The theoretical and applied dimensions pertaining to sustainable development, as to the whole sustainability science, are relatively delicate, given the fact that one can count a few hundred definitions that are attached to the core concept [1], with all this variety not necessarily contributing to clarity [2]. As pointed out in several bodies of the economic literature, there is no irreconcilable conflict between “free-market economics” and “environmental/sustainability economics” [7,8], but, on the contrary, as we try to re-emphasize in this paper: it is the missing role of social institutions (and of legislation/policies thereof) in economic processes that is conducive to a gap between environmental ends and means. Such situation may be called “institutional mismatch” [9]. The present study (i) starts with a dual-track literature review (both theoretical and empirical), emphasizing the steps forward as well as the blank spots in the scientific works devoted to this subject, Sustainability 2020, 12, x FOR PEER REVIEW Sustainability 2020, 12, 9440 of 22 3 of 22 theoretical and empirical), emphasizing the steps forward as well as the blank spots in the scientific twhoernk(siid) eitvfootleldowtos twhiitshsuabbjreicetf, sthuervne(yii)ofitthfoellroewlesvawnitthEUa blergieifslsautirovneyanodf tdheegrreeleevoafnimt EpUlemleegnistlaattiioonn, (ainiid) cdoengcrleuedoinf gimwpiltehmthenetqautiioten,il(liuiis)tcroanticvleu/dininstgruwcittihvethceasqeuoitfeRilolumsatrnaitai.ve/instructive case of Romania
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