Income inequality and circular materials use: an analysis of European Union economies and implications for circular economy development
ISSN: 0025-1747
Article publication date: 3 July 2023
Issue publication date: 5 September 2024
Abstract
Purpose
The purpose of the research was to evaluate the relationship between income and the recycled materials used in order to rate the business related to circular repair services under the burden of economic development in the countries of the European Union.
Design/methodology/approach
The analytical processes explore data from 2010 to 2020. The countries were divided into clusters according to economic maturity (Human Development Index (HDI), real Gross domestic product (GDP) per capita). Subsequently, the relationships were evaluated through the income indicators (for the 13 population groups), and the circular materials use rate indicator. The three indicators decomposed into five specific metrics were employed. The commonly applied characteristics of the descriptive analysis, Pearson's correlation coefficient and the panel regression analysis were engaged in the investigation.
Findings
The results demonstrated the vast disparities between income and circular materials use. In the more economically developed countries, their levels were twice higher as the less-developed countries. However, there is a meaningful positive relationship between them. The greatest attention was paid to the panel regression analysis applied to the relationship between income and circular economy (CE) use. The results showed that in a majority of the cases (different income categories), there is a significant positive relationship. When comparing the outcomes of the regression models between the groups of the countries according to their economic development, a closer relationship was clearly demonstrated in the countries with a lower level of development (Bulgaria, Romania, Croatia, Hungary).
Research limitations/implications
Besides the specific strengths, the study also shows some limitations identified mainly on the data side. The latest data on the consumption of circular materials come from 2020, so they do not cover the period related to the pandemic crisis. It is believed that there may have been some changes in income during the pandemic, and they may have harmed CE. Furthermore, there is to note that some limitations occur in the analytical process. The incompleteness of the data can also be included here as certain data is not available; hence, it was estimated directly by the Eurostat statistical authority.
Practical implications
At the same time, the following are currently considered among the primary barriers: financial restrictions, insufficient infrastructure, weak government support and obstacles on the global market. Consumers, industry leaders and the government are the most influential stakeholder groups in overcoming barriers. Higher demand for repair services will also initiate further development of business activities in this area at various regional levels. Progress in the repair services economy will continue to require extensive efforts in the future. Systematic coordination of activities at multiple levels of government together with manufacturers, designers, educational institutions, community institutions and individuals will be essential.
Social implications
Socioeconomic characteristics such as sex, age and education represent crucial predictors of consumer behavior. Therefore, the authors would like to focus future research on analyzing these characteristics and examine all the conceptual frameworks of consumer behavior and its positioning in detail within CE and the strategies related to the repair service. Discussing this issue through follow-up research will allow for solving complex transformational and political tasks related to the repair service strategies within CE. It will also inspire the discussion frameworks and multidisciplinary solutions to this issue affecting the fields of human geography, sociological, ethnographic and political sciences.
Originality/value
In less-developed countries, wage change can have a more substantial impact on the development of the CE. Also, a closer relationship between business in the field of repair services with income and the use of circular materials was manifested in the same way.
Keywords
Acknowledgements
This work was supported by Tomas Bata University in Zlín with the project no. RO/FaME/2022/05.
Expression of concern: The publisher of Management Decision is issuing an Expression of Concern for the following article Skare, M., Gavurova, B. and Rigelsky, M. (2023), “Income inequality and circular materials use: an analysis of European Union economies and implications for circular economy development”, Management Decision, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/MD-11-2022-1620, which was submitted to the guest-edited special issue ‘Navigating the role of circular economy in entrepreneurship: Opportunities and challenges’. An investigation by the publisher found a number of articles with multiple concerns, including but not limited to compromised editorial handling and reviewing, undisclosed conflicts of interest, and lack of suitability for the scope of the journal. As a result of these concerns and as trust in the content is central to the integrity of the publication process, the Editor-in-Chief and publisher have taken the decision to publish an Expression of Concern for all articles within this special issue. The journal has not been able to confirm whether the authors were aware of these concerns. The authors of this article would like to note that they do not agree with the content of this notice. An investigation is ongoing and is currently unresolved. Further information will be provided by Management Decision as it becomes available.
Citation
Skare, M., Gavurova, B. and Rigelsky, M. (2024), "Income inequality and circular materials use: an analysis of European Union economies and implications for circular economy development", Management Decision, Vol. 62 No. 9, pp. 2641-2665. https://doi.org/10.1108/MD-11-2022-1620
Publisher
:Emerald Publishing Limited
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