Natural resources, and the materials derived from them, represent the physical basis
for the economic system. Recent decades have witnessed an unprecedented growth in
demand for these resources, which has triggered interest from policy makers in transitioning
to a more resource efficient and circular economy. This report presents a typology
of five circular business models that could support the transition to a more resource
efficient and circular economy: circular supply, resource recovery, product life extension,
sharing, and product service system models. It reviews the current market penetration
and assesses the potential scalability of each business model. Environmental potential
is also discussed, as well as risks and unintended consequences that could result
from a more widespread adoption of these business models. The report provides a broad
set of policy approaches that could help alleviate some of the barriers that currently
hinder the widespread adoption of circular business models.
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