Abstract
Our analysis focuses on a novel theoretical model which explains the relationship between pollution and output as well as recycling and output in the context of the Environmental Kuznets Curve (EKC) framework. Our model incorporates habit formation on recycling in a circular economy model and we find that the EKC is characterized by a downward sloping curve, while the recycling output curve by an increasing curve, results which are both in agreement with the general patterns of these curves supported by the literature.
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