Biases and Nudges in the Circular Economy: A Review

The circular economy transition requires consumers to make further efforts in their waste disposal behaviors, by increasing waste sorting, repairing and reusing products, and reducing the amount of waste produced. The literature has identified several barriers to consumers’ adoption of these practices. In this paper, we posit that such barriers can be ultimately linked to well-known decisional biases and proceed to offer a review. In doing so, we categorize biases into “cognitive”, referring to deviations from normatively correct behavior, and “motivational”, encompassing behavior driven by desirability concerns. We also survey the existing behavioral policies addressing the identified biases, focusing on “nudges”, that is, interventions leveraging biases to improve welfare. In our review, we call attention to the importance of recognizing the relevant bias behind specific behaviors to identify the best interventions to implement. By offering a conceptual link between biases and circular economy practices, we also lay the groundwork for future experimental investigation.