IDEAS home Printed from https://ideas.repec.org/a/gam/jresou/v13y2024i5p65-d1390506.html
   My bibliography  Save this article

Chemical Leasing (Ch.L.) and the Sherwood Plot

Author

Listed:
  • Georgios Karakatsanis

    (Department of Research, EVOTROPIA Ecological Finance Architectures Private Company (P.C.), 190 Syngrou Avenue, 17671 Kallithea, Greece
    Department of Water Resources and Environmental Engineering, School of Civil Engineering, National Technical University of Athens (NTUA), 9 Heroon Polytechneiou St., 15870 Zografou, Greece)

  • Christos Makropoulos

    (Department of Water Resources and Environmental Engineering, School of Civil Engineering, National Technical University of Athens (NTUA), 9 Heroon Polytechneiou St., 15870 Zografou, Greece)

Abstract

Although the Circular Economy (CE) has made remarkable technological progress by offering a wide range of alternative engineering solutions, an obstacle for its large-scale commercialization is nested in the adoption of those business and financial models that accurately depict the value generated from resource recovery . Recovering a resource from a waste matrix conserves natural reserves in situ by reducing demand for virgin resources, as well as conserving environmental carrying capacities by reducing waste discharges. The standard business model for resource recovery is Industrial Symbiosis (IS), where industries organize in clusters and allocate the process of waste matrices to achieve the recovery of a valuable resource at an optimal cost. Our work develops a coherent microeconomic architecture of Chemical Leasing (Ch.L.) contracts within the analytical framework of the Sherwood Plot (SP) for recovering a Value-Added Compound (VAC) from a wastewater matrix. The SP depicts the relationship between the VAC’s dilution in the wastewater matrix and its cost of recovery. ChL is engineered on the SP as a financial contract, motivating industrial synergies for delivering the VAC at the target dilution level at the market’s minimum cost and with mutual profits. In this context, we develop a ChL market typology where information completeness on which industry is most cost-efficient in recovering a VAC at every dilution level determines market dominance via a Kullback–Leibler Divergence (D KL ) metric. In turn, we model how payoffs are allocated between industries via three ChL contract pricing systems, their profitability limits, and their fitting potential by market type. Finally, we discuss the emerging applications of ChL financial engineering in relation to three vital pillars of resource recovery and natural capital conservation.

Suggested Citation

  • Georgios Karakatsanis & Christos Makropoulos, 2024. "Chemical Leasing (Ch.L.) and the Sherwood Plot," Resources, MDPI, vol. 13(5), pages 1-36, May.
    • Handle: RePEc:gam:jresou:v:13:y:2024:i:5:p:65-:d:1390506
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2079-9276/13/5/65/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2079-9276/13/5/65/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Quentin Grafton, R. & Jotzo, Frank & Wasson, Merrilyn, 2004. "Financing sustainable development: Country Undertakings and Rights for Environmental Sustainability CURES," Ecological Economics, Elsevier, vol. 51(1-2), pages 65-78, November.
    2. Castelnuovo, Efrem & Galeotti, Marzio & Gambarelli, Gretel & Vergalli, Sergio, 2005. "Learning-by-Doing vs. Learning by Researching in a model of climate change policy analysis," Ecological Economics, Elsevier, vol. 54(2-3), pages 261-276, August.
    3. Georgios Karakatsanis & Nikos Mamassis, 2023. "Energy, Trophic Dynamics and Ecological Discounting," Land, MDPI, vol. 12(10), pages 1-43, October.
    4. Lozano, Rodrigo & Carpenter, Angela & Lozano, Francisco J., 2014. "Critical reflections on the Chemical Leasing concept," Resources, Conservation & Recycling, Elsevier, vol. 86(C), pages 53-60.
    5. Bolton, Roger, 1989. "Integrating economic and environmental models: Some preliminary considerations," Socio-Economic Planning Sciences, Elsevier, vol. 23(1-2), pages 25-37.
    6. Giovanni Dosi, 2000. "Finance, Innovation and Industrial Change," Chapters, in: Innovation, Organization and Economic Dynamics, chapter 21, pages 621-641, Edward Elgar Publishing.
    7. Oksana Mont & Pranshu Singhal & Zinaida Fadeeva, 2006. "Chemical Management Services in Sweden and Europe: Lessons for the Future," Journal of Industrial Ecology, Yale University, vol. 10(1‐2), pages 279-292, January.
    8. Maryam Keyhani & Atefeh Abbaspour & Ali Bahadori-Jahromi & Anastasia Mylona & Alan Janbey & Paulina Godfrey & Hexin Zhang, 2023. "Whole Life Carbon Assessment of a Typical UK Residential Building Using Different Embodied Carbon Data Sources," Sustainability, MDPI, vol. 15(6), pages 1-17, March.
    9. Vellinga, Nico & Withagen, Cees, 1996. "On the Concept of Green National Income," Oxford Economic Papers, Oxford University Press, vol. 48(4), pages 499-514, October.
    10. Philippe Marin, 2009. "Public-Private Partnerships for Urban Water Utilities : A Review of Experiences in Developing Countries," World Bank Publications - Books, The World Bank Group, number 2703.
    11. Greco, Marco & Grimaldi, Michele & Cricelli, Livio, 2016. "An analysis of the open innovation effect on firm performance," European Management Journal, Elsevier, vol. 34(5), pages 501-516.
    12. Georgios Karakatsanis & Nikos Mamassis, 2023. "Energy and the Macrodynamics of Agrarian Societies," Land, MDPI, vol. 12(8), pages 1-40, August.
    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. Valérie Revest & Alessandro Sapio, 2012. "Financing technology-based small firms in Europe: what do we know?," Small Business Economics, Springer, vol. 39(1), pages 179-205, July.
    2. Carboni, Oliviero A. & Medda, Giuseppe, 2021. "External R&D and product innovation: Is over-outsourcing an issue?," Economic Modelling, Elsevier, vol. 103(C).
    3. van der Ploeg, Frederick, 2010. "Why do many resource-rich countries have negative genuine saving?: Anticipation of better times or rapacious rent seeking," Resource and Energy Economics, Elsevier, vol. 32(1), pages 28-44, January.
    4. Claude Ménard, 2013. "Is Public-Private Partnership Obsolete? Assessing the Obstacles and Shortcomings of PPP," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-00653090, HAL.
    5. Luca Tacconi & Frank Jotzo & R. Grafton, 2008. "Local causes, regional co-operation and global financing for environmental problems: the case of Southeast Asian Haze pollution," International Environmental Agreements: Politics, Law and Economics, Springer, vol. 8(1), pages 1-16, March.
    6. Kirk Hamilton & Cees Withagen, 2007. "Savings growth and the path of utility," Canadian Journal of Economics/Revue canadienne d'économique, John Wiley & Sons, vol. 40(2), pages 703-713, May.
    7. Jean-Michel Dalle, 1995. "Dynamiques d'adoption, coordination et diversité : la diffusion des standards technologiques," Revue Économique, Programme National Persée, vol. 46(4), pages 1081-1098.
    8. Gérard Charreaux, 2002. "Variation sur le thème:"À la recherche de nouvelles fondations pour la finance et la gouvernance d'entreprise"," Revue Finance Contrôle Stratégie, revues.org, vol. 5(3), pages 5-68, September.
    9. Studart, Rogério, 2005. "The State, the markets and development financing," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL), April.
    10. García-Valiñas, María de los Ángeles & González-Gómez, Francisco & Picazo-Tadeo, Andrés J., 2013. "Is the price of water for residential use related to provider ownership? Empirical evidence from Spain," Utilities Policy, Elsevier, vol. 24(C), pages 59-69.
    11. Nguyen Thi Canh & Nguyen Thanh Liem & Phung Anh Thu & Nguyen Vinh Khuong, 2019. "The Impact of Innovation on the Firm Performance and Corporate Social Responsibility of Vietnamese Manufacturing Firms," Sustainability, MDPI, vol. 11(13), pages 1-14, July.
    12. Jayadev, Arjun & Bowles, Samuel, 2006. "Guard labor," Journal of Development Economics, Elsevier, vol. 79(2), pages 328-348, April.
    13. Abu Rashed, & Alam, Md. Mahmudul & Faisal, Fahim, 2019. "The Performance and Challenges of Public-Private Partnership (PPP) Projects in Bangladesh," OSF Preprints v2k3b, Center for Open Science.
    14. Cefis, Elena & Bartoloni, Eleonora & Bonati, Marco, 2020. "Show me how to live: Firms' financial conditions and innovation during the crisis," Structural Change and Economic Dynamics, Elsevier, vol. 52(C), pages 63-81.
    15. Tea Petrin & Dragana Radicic, 2023. "Instrument policy mix and firm size: is there complementarity between R&D subsidies and R&D tax credits?," The Journal of Technology Transfer, Springer, vol. 48(1), pages 181-215, February.
    16. Geir B. Asheim, 2003. "Green national accounting for welfare and sustainability:A Taxonomy Of Assumptions And Results," Scottish Journal of Political Economy, Scottish Economic Society, vol. 50(2), pages 113-130, May.
    17. Mino, Kazuo, 2004. "Weitzman's rule with market distortions," Japan and the World Economy, Elsevier, vol. 16(3), pages 307-329, August.
    18. Yezdi H. Godiwalla, 2018. "Global Organizational Innovation Strategy," International Journal of Social Science Studies, Redfame publishing, vol. 6(8), pages 45-53, August.
    19. Aleid E. Brouwer, 2004. "The inert firm; why old firms show a stickiness to their location," ERSA conference papers ersa04p165, European Regional Science Association.
    20. Halme, Minna & Anttonen, Markku & Kuisma, Mika & Kontoniemi, Nea & Heino, Erja, 2007. "Business models for material efficiency services: Conceptualization and application," Ecological Economics, Elsevier, vol. 63(1), pages 126-137, June.

    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:gam:jresou:v:13:y:2024:i:5:p:65-:d:1390506. 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: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    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.