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Circular Economy Approach: The benefits of a new business model for European Firms

Author

Listed:
  • Carlo Bellavite Pellegrini

    (Dipartimento di Politica Economica, DISCE, & Centro Studi Economia Applicata (CSEA), Università Cattolica del Sacro Cuore)

  • Laura Pellegrini

    (Dipartimento di Politica Economica, DISCE, & Centro Studi Economia Applicata (CSEA), Università Cattolica del Sacro Cuore)

  • Claudia Cannas

    (Centro Studi Economia Applicata (CSEA), Università Cattolica del Sacro Cuore)

Abstract

This study investigates the relationship between Firms’ Performance and the adoption of a Circular Economy (CE) Approach. Considering different “recovery-recycling” models embraced by European countries between 2003 and 2016, the empirical analysis aims to highlight benefits related to CE approach. Specifically, we built a sample of panel data, which involved 60 European listed companies producing several types of packaging (including plastic, glass, cardboard and metal), and raw materials (glass and paper). Over the last decades, the increasing attention to Circular Economy issues in Europe has been followed by an important regulation’s activity aimed to define a common policy on the production and treatment of waste. However, European countries due to their different economic conditions, experienced more or less effectively benefits of CE models which are still under-explored. Our empirical findings confirm previous economic literature (Ferreira N. et al. 2014; CIWM, 2016), pointing out better Perfomances for European companies adopting “Extended Producer Responsability” (ERP) scheme, such as PRO's Competition model. Empirical evidences suggested a positive and highly significant impact on Firms’ Performance as results of more competition among recovery organizations which can be justified by lower costs for companies joining collective recovery schemes.

Suggested Citation

  • Carlo Bellavite Pellegrini & Laura Pellegrini & Claudia Cannas, 2021. "Circular Economy Approach: The benefits of a new business model for European Firms," DISCE - Quaderni del Dipartimento di Politica Economica dipe0018, Università Cattolica del Sacro Cuore, Dipartimenti e Istituti di Scienze Economiche (DISCE).
    • Handle: RePEc:ctc:serie5:dipe0018
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    More about this item

    Keywords

    Circular Economy; Firms’ Perfomance; Extended Producer Responsability (ERP); Stock Return;
    All these keywords.

    JEL classification:

    • C23 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Models with Panel Data; Spatio-temporal Models
    • Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development
    • 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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