IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v14y2022i15p9492-d878597.html
   My bibliography  Save this article

Leveraging Blockchain and Smart Contract Technologies to Overcome Circular Economy Implementation Challenges

Author

Listed:
  • Nallapaneni Manoj Kumar

    (School of Energy and Environment, City University of Hong Kong, Kowloon, Hong Kong)

  • Shauhrat S. Chopra

    (School of Energy and Environment, City University of Hong Kong, Kowloon, Hong Kong)

Abstract

Adopting a circular economy (CE) has rapidly emerged among policymakers and business community stakeholders to promote material circularization and ensure sustainable development. While the inclination for a paradigm shift away from the linear economy is evident, many challenges have been quoted in the literature regarding its implementation. Lately, it has become common to propose Information and Communication Technologies (ICT)-based approaches to address these challenges. However, they do not question the practicality of the solutions in the context of CE. This paper aims to find an appropriate digital solution for CE implementation, which is not possible without a complete understanding of the existing challenges. A thorough literature review broadly classified the challenges under five barrier categories: Technological, Financial, Infrastructural, Institutional, and Societal, which was followed up with an investigation into the failure of ICT solutions to address CE challenges. Among the various technologies, blockchain and smart contract technologies show some promise as data-driven decision-making tools; however, they are not without their limitations when applied in the context of CE. This perspective explores the role of blockchain smart contract technology-scape in overcoming CE challenges and presents a circular economy blockchain (CEB) architecture development. The findings suggest that CEB may enable CE business models that improve trust and transparency in supply-chain networks, shared and performance economy platforms, stakeholder participation, and governance and management of organizations. Ultimately, this study highlights critical areas for research and development for the blockchainification of CE .

Suggested Citation

  • Nallapaneni Manoj Kumar & Shauhrat S. Chopra, 2022. "Leveraging Blockchain and Smart Contract Technologies to Overcome Circular Economy Implementation Challenges," Sustainability, MDPI, vol. 14(15), pages 1-18, August.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:15:p:9492-:d:878597
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/14/15/9492/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/14/15/9492/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Vasileios Rizos & Arno Behrens & Wytze Van der Gaast & Erwin Hofman & Anastasia Ioannou & Terri Kafyeke & Alexandros Flamos & Roberto Rinaldi & Sotiris Papadelis & Martin Hirschnitz-Garbers & Corrado , 2016. "Implementation of Circular Economy Business Models by Small and Medium-Sized Enterprises (SMEs): Barriers and Enablers," Sustainability, MDPI, vol. 8(11), pages 1-18, November.
    2. Pazaitis, Alex & De Filippi, Primavera & Kostakis, Vasilis, 2017. "Blockchain and value systems in the sharing economy: The illustrative case of Backfeed," Technological Forecasting and Social Change, Elsevier, vol. 125(C), pages 105-115.
    3. de Vries, Bert J.M. & Petersen, Arthur C., 2009. "Conceptualizing sustainable development: An assessment methodology connecting values, knowledge, worldviews and scenarios," Ecological Economics, Elsevier, vol. 68(4), pages 1006-1019, February.
    4. Alex Pazaitis & Primavera De Filippi & Vasilis Kostakis, 2017. "Blockchain and Value Systems in the Sharing Economy: The Illustrative Case of Backfeed," The Other Canon Foundation and Tallinn University of Technology Working Papers in Technology Governance and Economic Dynamics 73, TUT Ragnar Nurkse Department of Innovation and Governance.
    5. John A. Mathews & Hao Tan, 2011. "Progress Toward a Circular Economy in China," Journal of Industrial Ecology, Yale University, vol. 15(3), pages 435-457, June.
    6. Yong Geng & Murray Haight & Qinghua Zhu, 2007. "Empirical analysis of eco-industrial development in China," Sustainable Development, John Wiley & Sons, Ltd., vol. 15(2), pages 121-133.
    7. Alex Pazaitis & Primavera de Filippi & Vasilis Kostakis, 2017. "Blockchain and value systems in the sharing economy: The illustrative case of Backfeed," Post-Print hal-01676881, HAL.
    8. Joseph Guiltinan, 2009. "Creative Destruction and Destructive Creations: Environmental Ethics and Planned Obsolescence," Journal of Business Ethics, Springer, vol. 89(1), pages 19-28, May.
    9. de Jesus, Ana & Mendonça, Sandro, 2018. "Lost in Transition? Drivers and Barriers in the Eco-innovation Road to the Circular Economy," Ecological Economics, Elsevier, vol. 145(C), pages 75-89.
    10. Luca Berchicci & Wynand Bodewes, 2005. "Bridging environmental issues with new product development," Business Strategy and the Environment, Wiley Blackwell, vol. 14(5), pages 272-285, September.
    11. Andrew M. King & Stuart C. Burgess & Winnie Ijomah & Chris A. McMahon, 2006. "Reducing waste: repair, recondition, remanufacture or recycle?," Sustainable Development, John Wiley & Sons, Ltd., vol. 14(4), pages 257-267.
    12. Kirchherr, Julian & Reike, Denise & Hekkert, Marko, 2017. "Conceptualizing the circular economy: An analysis of 114 definitions," Resources, Conservation & Recycling, Elsevier, vol. 127(C), pages 221-232.
    13. Fenna Blomsma & Geraldine Brennan, 2017. "The Emergence of Circular Economy: A New Framing Around Prolonging Resource Productivity," Journal of Industrial Ecology, Yale University, vol. 21(3), pages 603-614, June.
    14. Kirchherr, Julian & Piscicelli, Laura & Bour, Ruben & Kostense-Smit, Erica & Muller, Jennifer & Huibrechtse-Truijens, Anne & Hekkert, Marko, 2018. "Barriers to the Circular Economy: Evidence From the European Union (EU)," Ecological Economics, Elsevier, vol. 150(C), pages 264-272.
    15. Korhonen, Jouni & Honkasalo, Antero & Seppälä, Jyri, 2018. "Circular Economy: The Concept and its Limitations," Ecological Economics, Elsevier, vol. 143(C), pages 37-46.
    16. John A. Mathews & Hao Tan, 2016. "Circular economy: Lessons from China," Nature, Nature, vol. 531(7595), pages 440-442, March.
    17. Marcus Linder & Mats Williander, 2017. "Circular Business Model Innovation: Inherent Uncertainties," Business Strategy and the Environment, Wiley Blackwell, vol. 26(2), pages 182-196, February.
    18. Östlin, Johan & Sundin, Erik & Björkman, Mats, 2008. "Importance of closed-loop supply chain relationships for product remanufacturing," International Journal of Production Economics, Elsevier, vol. 115(2), pages 336-348, October.
    19. Will McDowall & Yong Geng & Beijia Huang & Eva Barteková & Raimund Bleischwitz & Serdar Türkeli & René Kemp & Teresa Doménech, 2017. "Circular Economy Policies in China and Europe," Journal of Industrial Ecology, Yale University, vol. 21(3), pages 651-661, June.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Luis E. Ruiz & Ana C. Pinho & David N. Resende, 2022. "3D Printing as a Disruptive Technology for the Circular Economy of Plastic Components of End-of-Life Vehicles: A Systematic Review," Sustainability, MDPI, vol. 14(20), pages 1-19, October.
    2. Vimal K.E. K & Sivakumar K & Jayakrishna Kandasamy & Vaibhav Venkat & Raghuraman Srinivasan Mani, 2023. "Barriers to the adoption of digital technologies in a functional circular economy network," Operations Management Research, Springer, vol. 16(3), pages 1541-1561, September.
    3. Caferra, Rocco & D'Adamo, Idiano & Morone, Piergiuseppe, 2023. "Wasting energy or energizing waste? The public acceptance of waste-to-energy technology," Energy, Elsevier, vol. 263(PE).
    4. Manoj Kumar, Nallapaneni & Chopra, Shauhrat S., 2023. "Integrated techno-economic and life cycle assessment of shared circular business model based blockchain-enabled dynamic grapevoltaic farm for major grape growing states in India," Renewable Energy, Elsevier, vol. 209(C), pages 365-381.
    5. Syed Mithun Ali & Andrea Appolloni & Fausto Cavallaro & Idiano D’Adamo & Assunta Di Vaio & Francesco Ferella & Massimo Gastaldi & Muhammad Ikram & Nallapaneni Manoj Kumar & Michael Alan Martin & Abdul, 2023. "Development Goals towards Sustainability," Sustainability, MDPI, vol. 15(12), pages 1-11, June.
    6. Tuğba Yeğin & Muhammad Ikram, 2022. "Performance Evaluation of Green Furniture Brands in the Marketing 4.0 Period: An Integrated MCDM Approach," Sustainability, MDPI, vol. 14(17), pages 1-32, August.
    7. Shuchih Ernest Chang & Erik Chiaway Chang & Yijou Chen, 2022. "Blockchain Meets Sharing Economy: A Case of Smart Contract Enabled Ridesharing Service," Sustainability, MDPI, vol. 14(21), pages 1-23, October.
    8. Andrés Fernández-Miguel & Maria Pia Riccardi & Valerio Veglio & Fernando E. García-Muiña & Alfonso P. Fernández del Hoyo & Davide Settembre-Blundo, 2022. "Disruption in Resource-Intensive Supply Chains: Reshoring and Nearshoring as Strategies to Enable Them to Become More Resilient and Sustainable," Sustainability, MDPI, vol. 14(17), pages 1-13, August.
    9. Altaf Hossain Molla & Hilal Shams & Zambri Harun & Mohd Nizam Ab Rahman & Hawa Hishamuddin, 2022. "An Assessment of Drivers and Barriers to Implementation of Circular Economy in the End-of-Life Vehicle Recycling Sector in India," Sustainability, MDPI, vol. 14(20), pages 1-25, October.
    10. Tuğba Yeğin & Muhammad Ikram, 2022. "Developing a Sustainable Omnichannel Strategic Framework toward Circular Revolution: An Integrated Approach," Sustainability, MDPI, vol. 14(18), pages 1-25, September.
    11. Samuel Chukwudi Agunyai & Lere Amusan, 2023. "Implications of Land Grabbing and Resource Curse for Sustainable Development Goal 2 in Africa: Can Globalization Be Blamed?," Sustainability, MDPI, vol. 15(14), pages 1-18, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Gilbert Silvius & Aydan Ismayilova & Vicente Sales-Vivó & Micol Costi, 2021. "Exploring Barriers for Circularity in the EU Furniture Industry," Sustainability, MDPI, vol. 13(19), pages 1-25, October.
    2. Hervé Corvellec & Alison F. Stowell & Nils Johansson, 2022. "Critiques of the circular economy," Journal of Industrial Ecology, Yale University, vol. 26(2), pages 421-432, April.
    3. Yamoah, Fred A. & Sivarajah, Uthayasankar & Mahroof, Kamran & Peña, Iker González, 2022. "Demystifying corporate inertia towards transition to circular economy: A management frame of reference," International Journal of Production Economics, Elsevier, vol. 244(C).
    4. Gabi Försterling & Ronald Orth & Benjamin Gellert, 2023. "Transition to a Circular Economy in Europe through New Business Models: Barriers, Drivers, and Policy Making," Sustainability, MDPI, vol. 15(10), pages 1-40, May.
    5. Bauwens, Thomas & Hekkert, Marko & Kirchherr, Julian, 2020. "Circular futures: What Will They Look Like?," Ecological Economics, Elsevier, vol. 175(C).
    6. Chedrak Chembessi & Christophe Beaurain & Geneviève Cloutier, 2022. "Analyzing Technical and Organizational Changes in Circular Economy (CE) Implementation with a TOE Framework: Insights from a CE Project of Kamouraska (Quebec)," Circular Economy and Sustainability,, Springer.
    7. Moritz Böhmecke‐Schwafert & Marie Wehinger & Robin Teigland, 2022. "Blockchain for the circular economy: Theorizing blockchain's role in the transition to a circular economy through an empirical investigation," Business Strategy and the Environment, Wiley Blackwell, vol. 31(8), pages 3786-3801, December.
    8. Malik, Ashish & Sharma, Piyush & Sharma, Piyush & Vinu, Ajayan & Karakoti, Ajay & Kaur, Kamalpreet & Gujral, Harpreet Singh & Munjal, Surender & Laker, Benjamin, 2022. "Circular economy adoption by SMEs in emerging markets: Towards a multilevel conceptual framework," Journal of Business Research, Elsevier, vol. 142(C), pages 605-619.
    9. D. D’Amato, 2021. "Sustainability Narratives as Transformative Solution Pathways: Zooming in on the Circular Economy," Circular Economy and Sustainability,, Springer.
    10. Graziela Darla Araujo Galvão & Steve Evans & Paulo Sergio Scoleze Ferrer & Marly Monteiro de Carvalho, 2022. "Circular business model: Breaking down barriers towards sustainable development," Business Strategy and the Environment, Wiley Blackwell, vol. 31(4), pages 1504-1524, May.
    11. Concepción Garcés-Ayerbe & Pilar Rivera-Torres & Inés Suárez-Perales & Dante I. Leyva-de la Hiz, 2019. "Is It Possible to Change from a Linear to a Circular Economy? An Overview of Opportunities and Barriers for European Small and Medium-Sized Enterprise Companies," IJERPH, MDPI, vol. 16(5), pages 1-15, March.
    12. Chembessi Chedrak & Gohoungodji Paulin & Juste Rajaonson, 2023. "“A fine wine, better with age”: Circular economy historical roots and influential publications: A bibliometric analysis using Reference Publication Year Spectroscopy (RPYS)," Journal of Industrial Ecology, Yale University, vol. 27(6), pages 1593-1612, December.
    13. Georgios Lanaras-Mamounis & Anastasios Kipritsis & Thomas A. Tsalis & Konstantinos Ι. Vatalis & Ioannis E. Nikolaou, 2022. "A Framework for Assessing the Contribution of Firms to Circular Economy: a Triple-Level Approach," Circular Economy and Sustainability,, Springer.
    14. Jing Shao & Cedric Aneye & Alyona Kharitonova & Wei Fang, 2023. "Essential innovation capability of producer‐service enterprises towards circular business model: Motivators and barriers," Business Strategy and the Environment, Wiley Blackwell, vol. 32(7), pages 4548-4567, November.
    15. Nan-Hua Nadja Yang & Ana Carolina Bertassini & Jéssica Alves Justo Mendes & Mateus Cecílio Gerolamo, 2021. "The ‘3CE2CE’ Framework—Change Management Towards a Circular Economy: Opportunities for Agribusiness," Circular Economy and Sustainability,, Springer.
    16. Julian Kirchherr & Andrea Urbinati & Kris Hartley, 2023. "Circular economy: A new research field?," Journal of Industrial Ecology, Yale University, vol. 27(5), pages 1239-1251, October.
    17. Julian Kirchherr & Thomas Bauwens & Tomás B. Ramos, 2023. "Circular disruption: Concepts, enablers and ways ahead," Business Strategy and the Environment, Wiley Blackwell, vol. 32(3), pages 1005-1009, March.
    18. Iordanis Eleftheriadis & Evgenia Anagnostopoulou, 2024. "Developing a Tool for Calculating the Carbon Footprint in SMEs," Sustainability, MDPI, vol. 16(5), pages 1-23, February.
    19. D'Amato, D. & Korhonen, J., 2021. "Integrating the green economy, circular economy and bioeconomy in a strategic sustainability framework," Ecological Economics, Elsevier, vol. 188(C).
    20. Gutberlet, Melissa & Preuss, Lutz & Thorpe, Andrea Stevenson, 2023. "Macro level matters: Advancing circular economy in different business systems within Europe," Ecological Economics, Elsevier, vol. 211(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:14:y:2022:i:15:p:9492-:d:878597. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.