136 6 Summary and Implications
Second, decoupling economic growth from resource consumption soundstempting. In a circular economy material should be re-used over and over again in
order to avoid exploitation of raw material. This means economic growth needs to
be covered by reused material. This only works as long as the efficiency of reused
material is higher than the amount of material needed for economic growth. It
seems unlikely that the amount of reused material suffices for economic growth.
There are major uncertainties such as if material innovations have the ability to
compensate for the increasing demand for reused material in order to enable
growth. Further unknown is the amount of possible lifecycles certain material has
and if customers are going to accept buying products made of reused material. The
uncertainties regarding the ability to grow with solely reused material is seen as
the second downside of the concept.
Third, the concept of a circular economy seems convincing, but benefits foreconomy, ecology, and society are not yet proven. One question remains open and
can only be answered after a couple of years: Compared to a linear economy, is a
circular economy really beneficial for economy, ecology, and society? As the concept
is in such an early stage, there is not enough information to answer the question.
Organizations, governments, and society haven’t gained enough experience with
the concept so far. However, a few years from now, an assessment is required to
answer the questions raised above. Besides the potential benefit, literature and this
study also identify enormous challenges that have to be overcome. Transforming
today’s linear economy (‘take, make, and dispose’) into a circular economy requires
high efforts (e.g. switching costs, innovation costs) and the assessment of benefits
vs. costs. In order to assess advantages and disadvantages of a circular economy in
comparison to a linear economy, it is necessary to include the three dimensions:
economy, ecology, and society. A cost-benefit analysis is required for each of the
three dimensions to answer the question.
In order to evaluate the economical dimension, a look at the organizationalperformance is useful. Profitability measures are the most commonly used financial
measures to assess a company’s performance (Brown and Laverick 1994). To assess
the environmental dimension, one option is to calculate the carbon footprint of a
circulatable product. Carbon footprint is commonly used to define the amount of
direct and indirect CO 2 emission associated with human production and consump-
tion activities (Wiedmann and Minx 2008). While this measure is limited to CO 2
emission, there are also other options, such as a life cycle assessment or evaluation,
which is a combination of life cycle assessment and economic valuation. The life
cycle evaluation includes both environmental and social impacts in the evalua-
tion (Craighill and Powell 1996). Methods measuring the well-being of societies
(societal dimension) are, for example, the gross domestic product or the OECD