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Recycling under a material balance constraint

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  • Pittel, Karen
  • Amigues, Jean-Pierre
  • Kuhn, Thomas

Abstract

In this paper we analyze the dynamic implications of recycling for resource use, the level of economic activity and the long-run development of the economy. In contrast to former approaches, we take explicit account of the circulation of matter in the economy. We consider virgin resources and recycled wastes as essential inputs to production. These material inputs either end up as waste after consumption or are bound in the capital stock-depending on the utilization of the produced output. As accumulating wastes can be recycled and again be employed in production, the waste stock serves as a source of valuable inputs in our model. We focus on the implications of recycling-related market failures and the integration of material balances on the dynamics of the economy. It is shown that a market for waste and subsidies to resource extractors and recycling firms can restore optimality in the decentralized economy.

Suggested Citation

  • Pittel, Karen & Amigues, Jean-Pierre & Kuhn, Thomas, 2010. "Recycling under a material balance constraint," Munich Reprints in Economics 19357, University of Munich, Department of Economics.
    • Handle: RePEc:lmu:muenar:19357
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    References listed on IDEAS

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    1. Christian Scholz & Georg Ziemes, 1999. "Exhaustible Resources, Monopolistic Competition, and Endogenous Growth," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 13(2), pages 169-185, March.
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    7. Karen Pittel, 2006. "A Kuznets Curve for Recycling," CER-ETH Economics working paper series 06/52, CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich.
    8. repec:bla:scandj:v:104:y:2002:i:4:p:605-20 is not listed on IDEAS
    9. Thomas Kuhn & Karen Pittel & Thomas Schulz, 2003. "Recycling for sustainability - a long run perspective?," International Journal of Global Environmental Issues, Inderscience Enterprises Ltd, vol. 3(3), pages 339-355.
    10. Di Vita, Giuseppe, 2001. "Technological change, growth and waste recycling," Energy Economics, Elsevier, vol. 23(5), pages 549-567, September.
    11. Poul Schou, 2000. "Polluting Non-Renewable Resources and Growth," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 16(2), pages 211-227, June.
    12. Karen Pittel, 2002. "Sustainability and Endogenous Growth," Books, Edward Elgar Publishing, number 2776.
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    Cited by:

    1. Lafforgue, Gilles & Lorang, Etienne, 2022. "Recycling under environmental, climate and resource constraints," Resource and Energy Economics, Elsevier, vol. 67(C).
    2. Voosholz, Frauke, 2014. "The influence of different production functions on modeling resource extraction and economic growth," CAWM Discussion Papers 72, University of Münster, Münster Center for Economic Policy (MEP).
    3. Knut Einar Rosendahl & Diana Roa Rubiano, 2019. "How Effective is Lithium Recycling as a Remedy for Resource Scarcity?," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 74(3), pages 985-1010, November.
    4. Agliardi, Elettra & Kasioumi, Myrto, 2023. "Closing the loop in a duopolistic circular economy model," International Journal of Production Economics, Elsevier, vol. 262(C).
    5. Lafforgue, Gilles & Rouge, Luc, 2019. "A dynamic model of recycling with endogenous technological breakthrough," Resource and Energy Economics, Elsevier, vol. 57(C), pages 101-118.
    6. Zhou, Sophie, 2020. "Innovation and the macroeconomy," Other publications TiSEM 2225a10d-0121-4ff7-91fe-2, Tilburg University, School of Economics and Management.
    7. Fabre, Adrien & Fodha, Mouez & Ricci, Francesco, 2020. "Mineral resources for renewable energy: Optimal timing of energy production," Resource and Energy Economics, Elsevier, vol. 59(C).
    8. Diana Roa & Knut Einar Rosendahl, 2023. "Policies for Material Circularity: the Case of Lithium," Circular Economy and Sustainability, Springer, vol. 3(1), pages 373-405, March.
    9. Reyer Gerlagh & Etienne Lorang, 2024. "Material Source and Waste Taxes in Competitive Equilibrium," CESifo Working Paper Series 11091, CESifo.
    10. Levin, Mark (Левин, Марк), 2018. "Research of Economic Models of Innovations Aimed at Overcoming the Deficit of Natural Resources [Исследование Экономических Моделей Инноваций, Направленных На Преодоление Дефицита Природных Ресурсо," Working Papers 021803, Russian Presidential Academy of National Economy and Public Administration.
    11. Kiyoka Akimoto & Koichi Futagami, 2018. "Transition from a Linear Economy toward a Circular Economy in the Ramsey Model," Discussion Papers in Economics and Business 18-09, Osaka University, Graduate School of Economics.
    12. Meran, Georg, 2023. "Is green growth possible and even desirable in a spaceship economy?," Ecological Economics, Elsevier, vol. 213(C).
    13. Compagnoni, Marco & Stadler, Manfred, 2021. "Growth in a circular economy," University of Tübingen Working Papers in Business and Economics 145, University of Tuebingen, Faculty of Economics and Social Sciences, School of Business and Economics.
    14. Zhou, Sophie & Smulders, Sjak, 2021. "Closing the loop in a circular economy: Saving resources or suffocating innovations?," European Economic Review, Elsevier, vol. 139(C).
    15. Peter Birch Sørensen, 2017. "The Basic Environmental Economics of The Circular Economy," EPRU Working Paper Series 17-04, Economic Policy Research Unit (EPRU), University of Copenhagen. Department of Economics.

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