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Optimisation of the Circular Economy Based on the Resource Circulation Equation

Author

Listed:
  • Sanhong Liu

    (Business School, Shaoxing University, Shaoxing 312000, China)

  • Ying Xie

    (School of Management, Cranfield University, Cranfield MK43 0AL, UK)

  • Wen Liang

    (School of Accounting, Hangzhou Dianzi University, Hangzhou 310018, China)

Abstract

The lack of effective evaluation methods and implementation guidelines has led to frequent obstacles in the process of circular economy in enterprises. The efficiency equation for resource circulation can effectively evaluate the efficiency of an enterprise’s circular economy resource circulation from three perspectives: input, circulation, and output. Additionally, it delves into each link to identify weak points, offering guidance for optimising the enterprise’s circular economy. Utilising a value flow analysis within the context of a circular economy, this paper evaluates circular economy efficiency using a resource circulation efficiency equation. It conducts factor analysis across three dimensions: resource input, resource circulation, and waste output. This analysis aims to evaluate the corresponding resource productivity, added value output rate, and environmental efficiency. Factor decomposition techniques were then employed to identify the underlying factors contributing to poor circular economy outcomes. Furthermore, based on the relationships among three resource circulation indicators, this paper forecasts the potential advantages of integrating circular economy improvement measures and proposes practical optimisation approaches. The enhanced resource circulation efficiency resulting from the proposed optimisation approaches was validated through a case study with an aluminium company.

Suggested Citation

  • Sanhong Liu & Ying Xie & Wen Liang, 2024. "Optimisation of the Circular Economy Based on the Resource Circulation Equation," Sustainability, MDPI, vol. 16(15), pages 1-23, July.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:15:p:6514-:d:1446130
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    References listed on IDEAS

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    1. Thuy Thanh Tran & Christian Herzig, 2020. "Material Flow Cost Accounting in Developing Countries: A Systematic Review," Sustainability, MDPI, vol. 12(13), pages 1-18, July.
    2. Davide Aloini & Riccardo Dulmin & Valeria Mininno & Alessandro Stefanini & Pierluigi Zerbino, 2020. "Driving the Transition to a Circular Economic Model: A Systematic Review on Drivers and Critical Success Factors in Circular Economy," Sustainability, MDPI, vol. 12(24), pages 1-14, December.
    3. Akira Higashida, 2020. "Supply chain MFCA implementation: emphasizing evidence on coordination," Sustainability Accounting, Management and Policy Journal, Emerald Group Publishing Limited, vol. 12(4), pages 695-718, March.
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    1. Gianni Betti & Francesca Gagliardi & Andrea Mecca & Angelo Riccaboni & Cristiana Tozzi, 2025. "Sustainability and Circularity of the Agri-food Systems: How to Measure It? A First Attempt on the Italian System," Sustainability, MDPI, vol. 17(7), pages 1-17, April.

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