New consumption and production models for a circular economy
Economists have long attempted to understand the dichotomy between the finite quantity of natural resources and the seemingly unlimited human needs and wants. This contrast normally would resolve throughout free market actions and related materials pricing. However, modern societies and their embedded economic systems have proved to be unable to address natural resources scarcity in a satisfactory way. The tension between scarcity and human wants is expected to intensify as we anticipate the significant changes, which are bound to occur in the near future. Most notably, the world population, which in mid 2014 stands at 7.2 billion, is projected to increase by almost one billion people by 2025, and to reach 9.6 billion by 2050, as reported by the Food and Agriculture Organization of the United Nations (FAO) in 2015. At the same time, large and fast growing economies such as China and India, in spite of the recession declines in recent years, are still growing at high rates of 6.8% and 7.4% respectively. This will surely lead to increasing wealth. A major effect of these two trends will be a higher demand and consumption of food, manufactured goods and energy sources, adding pressure to the world economic system and the environment. Overarching these issues are the threat of climate change and the mounting concern to manage sustainably the increasing amounts of waste produced worldwide. Contemporary consumerism (i.e. the production and consumption patterns prevailing in high income countries) does not appear to be an economic model able to address all these challenges simultaneously. Hence, a transition from the current ecologically untenable modes of consumption and production towards new and more sustainable models seems a desirable and much needed objective. Under these circumstances, the passage from a linear take produce consume discard material flow system to a circular and regenerative model could play a central role in paving the way for transition to a more sustainable economic system that uses resources in a more efficient way, reducing the overall generation of wastes and facilitating the recovery of unavoidable wastes as the source of resources for the production of new products. Hence, a new circular paradigm is gaining momentum and is being propelled through the growing popularity of various, and often complementary, new economic models, e.g. peer to peer provisioning networks, alternative agro food arrangements, community energy schemes, worker owner cooperatives and initiatives to facilitate less resource intensive lifestyles, as described by Cohen (2013) However, these emerging innovations and models are cutting against incumbent socio technical systems in critical areas, such as energy consumption, food supply and mobility. It requires a major undertaking to successfully scale up these innovations to a level where they might begin to challenge dominant socio technical practices. Against this background, in this editorial we address some issues associated with this sustainability transition, drafting the possible contours of the new paradigm of the approaching circular economy and the role that new consumption and production models might play in creating favourable conditions for such a transition. Back in 1990, Pearce and Turner introduced the concept of a circular economy into mainstream economic theory. In their well known textbook on environmental economics, the authors addressed the interlinkage between the environment and the production/consumption economic model. In their newly proposed circular scheme, the environment provides amenity values, is a resource base and a sink for economic activities, and is also a fundamental life support system. Within the model, production is aimed at producing consumer goods (and capital goods, which in turn, produce consumption in the future) The purpose of consumption is to increase consumer's utility and/or enhance social welfare. However, at each stage of the supply chain, waste is produced. To some extent this waste might be recycled and reconverted into resources, reducing the need to mine virgin resources and, through this, the economy becomes circular. Yet, not all waste can be recycled or is recyclable, partly owing to missed opportunities and partly owing to basic physical and thermo dynamical laws. The amount of waste that can be recycled depends crucially on the capacity of the environment to assimilate residuals from the economic system. Once the assimilative capacity is exceeded, environmental damage occurs. This model is also fit to account for the finitude of resources. In fact, the environment provides a resource base, which functions as an input for the economy, both in terms of renewable resources and exhaustible resources. Many biological resources are renewable and can be harvested for economic purposes with no or limited impact, as long as the harvest does not exceed the annual yield. More problems arise in the case of exhaustible resources (e.g. fossil fuels and metals) where the physical stock, by definition, will be gradually depleted as the resources are extracted and brought into the economic system. Resource depletion, however, is possible both for exhaustible and renewable resources, this depending crucially on harvest and yield respective magnitudes. Bearing this in mind, new production and consumption models would have to consider in this circular scheme two further dimensions, namely reduce and reuse. Reduction can be achieved both on the production side (producing with less) as well as on the New consumption and production models for a circular economy 652281WMR0010.1177/0734242X16652281Waste Management ResearchEditorial editorial2016
Waste management research the journal of the International Solid Wastes and Public Cleansing Association, ISWA