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Circular Use of Materials: Drivers of the Circularity Rate in the European Union

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  • Reni Pantcheva

Abstract

In the transition to a greener economy, countries need suitable indicators to follow progress on sustainability. One such metric, the ‘circularity rate’, indicates the share of recovered resources used in the economy which substitute for primary raw materials. The current paper analyses 27 European Union member countries to study the effects of selected waste management and resource efficiency indicators as well as several socio-economic determinants on the circularity rate. Results indicate that four factors emerge as equally important – GDP per capita, research and development expenditure, resource productivity and environmental tax revenues, where past values of R&D expenditure and resource productivity are especially useful in predicting the circularity rate. The research findings also emphasise the importance of adequate environmental taxation policy and its role in driving circularity. Finally, suggestions for future research on the topic are made to expand the model and allow for comparisons with other countries on their path to a circular economy.

Suggested Citation

  • Reni Pantcheva, 2023. "Circular Use of Materials: Drivers of the Circularity Rate in the European Union," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 3, pages 148-161.
    • Handle: RePEc:bas:econst:y:2023:i:3:p:148-161
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    References listed on IDEAS

    as
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    JEL classification:

    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q53 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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