Policies for a More Dematerialized EU Economy: Theoretical Underpinnings, Political Context and Expected Feasibility

26 Pages Posted: 24 May 2016

See all articles by Andrea Bigano

Andrea Bigano

RFF-CMCC European Institute on Economics and the Environment; CMCC - Centro Euro-Mediterraneo sui Cambiamenti Climatici; Ca' Foscari University of Venice

Alexander Sniegocki

Warszawski Instytut Studiów Ekonomicznych (WISE)

Jacopo Zotti

Fondazione Eni Enrico Mattei (FEEM)

Date Written: May 24, 2016

Abstract

Economic activities affect the environment through a multiplicity of channels. Besides generating GHG emissions that induce climatic changes, every modern economy is connected to the environment throughout a continuous flow of materials. To generate economic wealth, a modern economy demands natural resources, and produces a continuous flow of waste. The scarcity of natural resources and the negative externalities arising along the life cycle of the resources from the extraction of the resources to their transformation, the use of the final products and eventually the final disposal of the latter seem natural motivations for the current policy push towards a more dematerialized and a more circular economy. The EU in particular appears to be approaching a new frontier of the environmental policy. The main contribution of this paper is a qualitative assessment of this strategy. To this aim, we first investigate the theoretical and political rationale for the EU to foster dematerialization, and on this basis, we provide an economic assessment of the effective feasibility of the initiative. From a theoretical economics point of view, the paper provides an overview of the main externalities arising from materials’ extraction, use and disposal. In a policy perspective, the paper reviews the state of affairs of the major world countries (USA, Japan and China in particular) on this issue, and contextualizes the EU action in a global perspective. This paper investigates whether in this policy field the EU can globally play a decisive role by itself or its role may be limited to providing a good example for other countries to follow, as in the case of the reduction of GHG emissions. In the second part of the paper we discuss some of the most promising policies put forward by the DYNAMIX project. On the basis of the qualitative policy assessment performed in DYNAMIX, we illustrate why these measures might be worth serious consideration. A discussion regarding the political economy of the policies under scrutiny complements the analysis of their effectiveness and efficiency.

Keywords: Dematerialization, Absolute Decoupling, Resource Efficiency, Policy Mixes, Qualitative Assessment

JEL Classification: H23, O44, Q01, Q32

Suggested Citation

Bigano, Andrea and Sniegocki, Alexander and Zotti, Jacopo, Policies for a More Dematerialized EU Economy: Theoretical Underpinnings, Political Context and Expected Feasibility (May 24, 2016). FEEM Working Paper No. 39.2016, Available at SSRN: https://ssrn.com/abstract=2783690 or http://dx.doi.org/10.2139/ssrn.2783690

Andrea Bigano (Contact Author)

RFF-CMCC European Institute on Economics and the Environment ( email )

Via Bergognone, 34
Milan, 20144
Italy

CMCC - Centro Euro-Mediterraneo sui Cambiamenti Climatici ( email )

via Augusto Imperatore, 16
Lecce, I-73100
Italy

Ca' Foscari University of Venice ( email )

Dorsoduro 3246
Venice, Veneto 30123
Italy

Alexander Sniegocki

Warszawski Instytut Studiów Ekonomicznych (WISE) ( email )

Al. Jerozolimskie 99 lok. 18
Warszawa, 02-001
Poland

Jacopo Zotti

Fondazione Eni Enrico Mattei (FEEM) ( email )

C.so Magenta 63
Milano, 20123
Italy

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