Definition of Circular and Linear Economy

This approach should be understood in opposition to that of economy linear. These are two different models when assessing everything related to the economy: obtaining raw materials, manufacturing of products, waste disposal, business profits and the role of consumers.

General scheme of the linear economy

If we take as a reference a good of consumption determined, this normally presents a linear type process. Thus, first some raw materials are extracted, then these materials are modified or refined, Subsequently, a product is manufactured in an industrial way and, finally, the product is acquired by a consumer.

The process does not end here, since the consumer stops using the purchased product, which becomes waste. This system is like a line with a beginning and an end.

The linear economy is based on two great principles:

1) permanent economic growth and consequent environmental deterioration and

2) constant consumption.

This model is not the only one possible and, in fact, the circular economy is presented as an alternative.

General outline of the circular economy

If we take a product as a reference (for example, a vehicle, a mobile phone, a pants or a computer) the app of this proposal would be the following:

1) the consumer does not part with the product that he acquired in his day when he decides to buy a new one, Rather, it repairs the product (for example, by inserting a new chip or any other upgrade),

2) As a consequence of point number 1, less waste is produced and, on the other hand, the manufacturing company does not have to manufacture more products and therefore money is saved in the production,

3) As a consequence of point number 2, the manufacturing company does not need to obtain so many raw materials and

4) If the product can be repaired, the cost of repairing is less than buying a new one.

The model described above is less polluting than the linear one, it generates economic benefits from the innovation and it does not imply a price increase for the final consumer.

It is a circular economy because the waste that is generated is not totally eliminated but instead returns to the production process to make new products or for other purposes.

The proposal for a circular economy is currently in an incipient stage. In any case, it is a system that can be applied to all types of business sectors. For many economists, the circular economy could be a solution to stop the contamination of the planet.

Photos: Fotolia - dukesn / popaukropa

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