Upstream economic instruments as circular economy drivers

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School of Business | Bachelor's thesis
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Date

2022

Department

Taloustieteen laitos

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Mcode

Degree programme

Taloustiede

Language

en

Pages

21

Series

Abstract

Municipal waste streams are expected to grow significantly in the nearest future. To address this issue, European policymakers are proposing new waste management reforms and waste-related directives that could alleviate the social burden of waste accumulation. The main basis of these policy guidelines is the promotion of recycling and the prevention of waste at its source. In this literature review, I briefly investigate the rationale for proposed circularity from an economic perspective. After that, the main focus of this thesis is on the producers of goods that act as decision-makers and through their choices can either support material circularity and waste prevention or conversely neglect socially preferable production methods. I find that social and private interests are not always aligned, and this contradiction can be addressed through the implementation of economic instruments. The main findings suggest that social efficiency can be improved, and conflicting interests can be corrected through instruments that mostly have the Pigouvian nature. Lastly, I finish my thesis with a brief discussion examining the potential risks and shortcomings of proposed market interventions.

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Thesis advisor

Stryjan, Miri

Keywords

waste management, recycling, economic instrument, Pigouvian, circular economy, taxation, extended producer responsibility, EPR

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https://urn.fi/URN:NBN:fi:aalto-202205153210

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[kand] Kauppakorkeakoulu / BIZ