[go: up one dir, main page]
More Web Proxy on the site http://driver.im/
IDEAS home Printed from https://ideas.repec.org/a/bla/bstrat/v29y2020i6p2450-2464.html
   My bibliography  Save this article

Barriers to the circular economy in European small and medium‐sized firms

Author

Listed:
  • Jose García‐Quevedo
  • Elisenda Jové‐Llopis
  • Ester Martínez‐Ros
Abstract
The concept of the circular economy (CE) is currently gaining impetus as a way to move towards sustainable, low‐carbon, resource‐efficient, and competitive economies. However, despite the potential benefits of CE activities, their implementation remains relatively rare. We use a cross‐sectional survey of European small and medium‐sized firms (SMEs) to identify the main barriers firms face to promote the CE, focusing specifically on the following: those related to a lack of resources (human and financial) and capabilities (expertise) and those related to the regulatory framework (administrative procedures and the costs of meeting the regulations). Our results indicate that it is the complexity of administrative/legal procedures and the costs of meeting regulations/legal standards that constitute the most significant barriers, whereas the lack of human resources is also perceived to be an obstacle by firms engaged in CE activities. Those obstacles may be considered revealed barriers, and it is only when the firms become involved in these activities that they actually perceive them. Furthermore, when we consider the breadth of CE activities, administrative procedures and regulations once again emerge as the most significant obstacles. Finally, we stress the need to distinguish between different CE activities given that the perception of barriers differs substantially across these activities. Firms undertaking a disruptive innovation redesigning products and services to minimize the use of materials are more likely to perceive all barriers as important. However, firms implementing such activities as minimizing waste, replanning energy usage, and using renewable energy only perceive those obstacles related to administrative procedures and regulations.

Suggested Citation

  • Jose García‐Quevedo & Elisenda Jové‐Llopis & Ester Martínez‐Ros, 2020. "Barriers to the circular economy in European small and medium‐sized firms," Business Strategy and the Environment, Wiley Blackwell, vol. 29(6), pages 2450-2464, September.
    • Handle: RePEc:bla:bstrat:v:29:y:2020:i:6:p:2450-2464
    DOI: 10.1002/bse.2513
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/bse.2513
    Download Restriction: no
    File URL: https://libkey.io/10.1002/bse.2513?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Lionel Nesta & Francesco Vona & Francesco Nicolli, 2012. "Environmental Policies, Product Market Regulation and Innovation in Renewable Energy," Working Papers 2012.90, Fondazione Eni Enrico Mattei.
    2. 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.
    3. Hölzl, Werner & Janger, Jürgen, 2014. "Distance to the frontier and the perception of innovation barriers across European countries," Research Policy, Elsevier, vol. 43(4), pages 707-725.
    4. Pierre Blanchard & Jean-Pierre Huiban & Antonio Musolesi & Patrick Sevestre, 2013. "Where there is a will, there is a way? Assessing the impact of obstacles to innovation," Industrial and Corporate Change, Oxford University Press and the Associazione ICC, vol. 22(3), pages 679-710, June.
    5. Alfonso Aranda-Usón & Pilar Portillo-Tarragona & Luz María Marín-Vinuesa & Sabina Scarpellini, 2019. "Financial Resources for the Circular Economy: A Perspective from Businesses," Sustainability, MDPI, vol. 11(3), pages 1-23, February.
    6. Horbach, Jens & Rammer, Christian & Rennings, Klaus, 2012. "Determinants of eco-innovations by type of environmental impact — The role of regulatory push/pull, technology push and market pull," Ecological Economics, Elsevier, vol. 78(C), pages 112-122.
    7. Carrión-Flores, Carmen E. & Innes, Robert, 2010. "Environmental innovation and environmental performance," Journal of Environmental Economics and Management, Elsevier, vol. 59(1), pages 27-42, January.
    8. Giulio Cainelli & Massimiliano Mazzanti & Sandro Montresor, 2012. "Environmental Innovations, Local Networks and Internationalization," Industry and Innovation, Taylor & Francis Journals, vol. 19(8), pages 697-734, November.
    9. García-Quevedo, José & Segarra-Blasco, Agustí & Teruel, Mercedes, 2018. "Financial constraints and the failure of innovation projects," Technological Forecasting and Social Change, Elsevier, vol. 127(C), pages 127-140.
    10. Claudia Ghisetti & Susanna Mancinelli & Massimiliano Mazzanti & Mariangela Zoli, 2017. "Financial barriers and environmental innovations: evidence from EU manufacturing firms," Climate Policy, Taylor & Francis Journals, vol. 17(0), pages 131-147, June.
    11. Giovanni Marin & Alberto Marzucchi & Roberto Zoboli, 2015. "SMEs and barriers to Eco-innovation in the EU: exploring different firm profiles," Journal of Evolutionary Economics, Springer, vol. 25(3), pages 671-705, July.
    12. Nesta, Lionel & Vona, Francesco & Nicolli, Francesco, 2014. "Environmental policies, competition and innovation in renewable energy," Journal of Environmental Economics and Management, Elsevier, vol. 67(3), pages 396-411.
    13. Kannan Govindan & Mia Hasanagic, 2018. "A systematic review on drivers, barriers, and practices towards circular economy: a supply chain perspective," International Journal of Production Research, Taylor & Francis Journals, vol. 56(1-2), pages 278-311, January.
    14. P. Mohnen & F. Palm & S. Loeff & A. Tiwari, 2008. "Financial Constraints and Other Obstacles: are they a Threat to Innovation Activity?," De Economist, Springer, vol. 156(2), pages 201-214, June.
    15. Pellegrino, Gabriele & Savona, Maria, 2017. "No money, no honey? Financial versus knowledge and demand constraints on innovation," Research Policy, Elsevier, vol. 46(2), pages 510-521.
    16. Yasemin Y. Kor & Joseph T. Mahoney & Steven C. Michael, 2007. "Resources, Capabilities and Entrepreneurial Perceptions," Journal of Management Studies, Wiley Blackwell, vol. 44(7), pages 1187-1212, November.
    17. Mohnen, Pierre & Roller, Lars-Hendrik, 2005. "Complementarities in innovation policy," European Economic Review, Elsevier, vol. 49(6), pages 1431-1450, August.
    18. Birger Wernerfelt, 1984. "A resource‐based view of the firm," Strategic Management Journal, Wiley Blackwell, vol. 5(2), pages 171-180, April.
    19. D’Este, Pablo & Iammarino, Simona & Savona, Maria & von Tunzelmann, Nick, 2012. "What hampers innovation? Revealed barriers versus deterring barriers," Research Policy, Elsevier, vol. 41(2), pages 482-488.
    20. Simona Iammarino & Francesca Sanna-Randaccio & Maria Savona, 2009. "The perception of obstacles to innovation. Foreign multinationals and domestic firms in Italy," Revue d'économie industrielle, De Boeck Université, vol. 0(1), pages 75-104.
    21. Hyytinen, Ari & Toivanen, Otto, 2005. "Do financial constraints hold back innovation and growth?: Evidence on the role of public policy," Research Policy, Elsevier, vol. 34(9), pages 1385-1403, November.
    22. 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.
    23. Frederique Savignac, 2008. "Impact Of Financial Constraints On Innovation: What Can Be Learned From A Direct Measure?," Economics of Innovation and New Technology, Taylor & Francis Journals, vol. 17(6), pages 553-569.
    24. 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.
    25. Carrión-Flores, Carmen E. & Innes, Robert & Sam, Abdoul G., 2013. "Do voluntary pollution reduction programs (VPRs) spur or deter environmental innovation? Evidence from 33/50," Journal of Environmental Economics and Management, Elsevier, vol. 66(3), pages 444-459.
    26. Korhonen, Jouni & Honkasalo, Antero & Seppälä, Jyri, 2018. "Circular Economy: The Concept and its Limitations," Ecological Economics, Elsevier, vol. 143(C), pages 37-46.
    27. Pelin Demirel & Gamze Ozturk Danisman, 2019. "Eco‐innovation and firm growth in the circular economy: Evidence from European small‐ and medium‐sized enterprises," Business Strategy and the Environment, Wiley Blackwell, vol. 28(8), pages 1608-1618, December.
    28. Ana-Maria Zamfir & Cristina Mocanu & Adriana Grigorescu, 2017. "Circular Economy and Decision Models among European SMEs," Sustainability, MDPI, vol. 9(9), pages 1-15, August.
    29. Costa-Campi, M.T. & García-Quevedo, J. & Martínez-Ros, E., 2017. "What are the determinants of investment in environmental R&D?," Energy Policy, Elsevier, vol. 104(C), pages 455-465.
    30. Alessandra Canepa & Paul Stoneman, 2008. "Financial constraints to innovation in the UK: evidence from CIS2 and CIS3," Oxford Economic Papers, Oxford University Press, vol. 60(4), pages 711-730, October.
    31. Pelin Demirel & Gamze Ozturk Danisman, 2019. "Eco-Innovation and Firm Growth in the Circular Economy: Evidence from European SMEs," SPRU Working Paper Series 2019-13, SPRU - Science Policy Research Unit, University of Sussex Business School.
    32. Horbach, Jens, 2008. "Determinants of environmental innovation--New evidence from German panel data sources," Research Policy, Elsevier, vol. 37(1), pages 163-173, February.
    Full references (including those not matched with items on IDEAS)

    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. Pinget, Amandine, 2016. "Spécificités des déterminants des innovations environnementales : une approche appliquée aux PME [Specificities of determinants for environmental innovation : an approach applied to SMEs]," MPRA Paper 80108, University Library of Munich, Germany.
    2. Amandine Pinget & Rachel Bocquet & Caroline Mothe, 2015. "Barriers to Environmental Innovation in SMEs: Empirical Evidence from French Firms," Post-Print hal-01300837, HAL.
    3. Giovanni Marin & Alberto Marzucchi & Roberto Zoboli, 2014. "SMEs and Barriers to Eco-Innovation in EU: A Diverse Palette of Greens," SEEDS Working Papers 0614, SEEDS, Sustainability Environmental Economics and Dynamics Studies, revised Apr 2014.
    4. Giovanni Marin & Alberto Marzucchi & Roberto Zoboli, 2015. "SMEs and barriers to Eco-innovation in the EU: exploring different firm profiles," Journal of Evolutionary Economics, Springer, vol. 25(3), pages 671-705, July.
    5. Zahler, Andrés & Goya, Daniel & Caamaño, Matías, 2022. "The primacy of demand and financial obstacles in hindering innovation," Technological Forecasting and Social Change, Elsevier, vol. 174(C).
    6. Grazia Cecere & Nicoletta Corrocher & Maria Luisa Mancusi, 2020. "Financial constraints and public funding of eco-innovation: empirical evidence from European SMEs," Small Business Economics, Springer, vol. 54(1), pages 285-302, January.
    7. de-Oliveira, Fernando & Rodil-Marzábal, Óscar, 2019. "Structural characteristics and organizational determinants as obstacles to innovation in small developing countries," Technological Forecasting and Social Change, Elsevier, vol. 140(C), pages 306-314.
    8. Aldieri, Luigi & Kotsemir, Maxim & Vinci, Concetto Paolo, 2017. "Jacobian spillovers in environmental technological proximity: the role of Mahalanobis index on European patents within the Triad," MPRA Paper 77274, University Library of Munich, Germany.
    9. Jaureguy, Micaela Vidal & Bianchi, Carlos & Blanchard, Pablo, 2023. "Financial and knowledge barriers to innovation: Complementary and substitution effects on innovative effort," Research Policy, Elsevier, vol. 52(7).
    10. Claudia Ghisetti & Massimiliano Mazzanti & Susanna Mancinelli & Mariangela Zoli, 2015. "Do financial constraints make the environment worse off? Understanding the effects of financial barriers on environmental innovations," SEEDS Working Papers 0115, SEEDS, Sustainability Environmental Economics and Dynamics Studies, revised Jan 2015.
    11. Garrido-Prada, Pablo & Lenihan, Helena & Doran, Justin & Rammer, Christian & Perez-Alaniz, Mauricio, 2021. "Driving the circular economy through public environmental and energy R&D: Evidence from SMEs in the European Union," Ecological Economics, Elsevier, vol. 182(C).
    12. Ghisetti, Claudia & Pontoni, Federico, 2015. "Investigating policy and R&D effects on environmental innovation: A meta-analysis," Ecological Economics, Elsevier, vol. 118(C), pages 57-66.
    13. Alessandra Colombelli & Jackie Krafft & Francesco Quatraro, 2021. "Firms’ growth, green gazelles and eco-innovation: evidence from a sample of European firms," Small Business Economics, Springer, vol. 56(4), pages 1721-1738, April.
    14. Gabriele Pellegrino, 2015. "Barriers to innovation: can firm age help lower them?," Working Papers 2015/3, Institut d'Economia de Barcelona (IEB).
    15. Brian Chi-ang Lin & Siqi Zheng & Nicolò Barbieri & Claudia Ghisetti & Marianna Gilli & Giovanni Marin & Francesco Nicolli, 2016. "A Survey Of The Literature On Environmental Innovation Based On Main Path Analysis," Journal of Economic Surveys, Wiley Blackwell, vol. 30(3), pages 596-623, July.
    16. Hölzl, Werner & Janger, Jürgen, 2014. "Distance to the frontier and the perception of innovation barriers across European countries," Research Policy, Elsevier, vol. 43(4), pages 707-725.
    17. Pavla Matulova & Petra Maresova & Mohammad Ali Tareq & Kamil Kuča, 2018. "Open Innovation Session as a Tool Supporting Innovativeness in Strategies for High-Tech Companies in the Czech Republic," Economies, MDPI, vol. 6(4), pages 1-13, December.
    18. Pellegrino, Gabriele & Savona, Maria, 2013. "Is money all? Financing versus knowledge and demand constraints to innovation," MERIT Working Papers 2013-029, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).
    19. Vicente Salas-Fumás & Javier Ortiz, 2019. "Innovations’ Success and Failure in the Business Cycle," Sustainability, MDPI, vol. 11(15), pages 1-22, August.
    20. Massimiliano Mazzanti & Giovanni Marin & Susanna Mancinelli & Francesco Nicolli, 2015. "Carbon dioxide reducing environmental innovations, sector upstream/downstream integration and policy: evidence from the EU," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 42(4), pages 709-735, November.

    More about this item

    Statistics

    Access and download statistics

    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:bla:bstrat:v:29:y:2020:i:6:p:2450-2464. 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: Wiley Content Delivery (email available below). General contact details of provider: http://onlinelibrary.wiley.com/journal/10.1002/(ISSN)1099-0836 .

    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.