Assessing the Impacts of Urban Circular

Economy Practices on Economic Growth,

Environmental Sustainability, and Social
Benefits: A Case Study Analysis

Adriana Salles(B) , Camila Cervantes , and Luís Bragança

ISISE, ARISE, Department of Civil Engineering, University of Minho, Guimarães, Portugal

[email protected]

Abstract. The urban circular economy is a highly effective approach to both waste
management and the utilization of resources. Many cities have already adopted
best practices based on circular economy principles. However, implementing such
practices requires multi-stakeholder engagement, new business models, and col-
laboration between cities. Some successful strategies exist, ranging from urban
agriculture and waste-to-energy to sharing economies, industrial symbiosis, and
sustainable mobility, as well as eco-design, waste prevention, and the extension of
product life. By adopting circular economy practices, cities can support economic
growth, reduce environmental impact, and create social benefits, thereby moving
towards a more sustainable future. In this regard, this study aims to analyze cir-
cular economy practices at the urban circularity level, by assessing their impacts
on economic growth, environmental sustainability, and social benefits. To achieve
this goal, a literature review is conducted to identify the most widely adopted
circular strategies in cities. Comprehensive data collection, encompassing quan-
titative and qualitative measures, including economic indicators, environmental
metrics, social assessments, and stakeholder feedback on the implementation pro-
cess. Then the case study of Amsterdam is selected to demonstrate how urban
circularity can be effective in achieving a balance between economic growth,
environmental sustainability, and social benefits. Finally, this study also provides
insights into the potential of urban circularity as an effective tool for sustainable
urban development.

Keywords: Urban Circular Economy · Sustainable Urban Development ·

Economic Growth · Environmental Sustainability · Social Benefits

1 Introduction
Cities are dynamic and complex entities shaped by a diverse array of actors, organi-
zations, and networks. Considering cities as crucial players in the global shift towards
sustainability, city managers, including policymakers, urban planners, and mayors, have
the potential to take the lead in addressing urban sustainability challenges and com-
bating climate change [1, 2]. In this regard, local governments possess comprehensive

© The Author(s) 2024

V. Ungureanu et al. (Eds.): CESARE 2024, LNCE 489, pp. 482–490, 2024.
https://doi.org/10.1007/978-3-031-57800-7_44
 Assessing the Impacts of Urban Circular Economy Practices 483

knowledge of their surroundings and have the authority to govern and make decisions
regarding urban planning, water management, waste disposal, and public transportation
[1].
Urged by the impending exhaustion of natural resources and the growing burden on
landfills, innovative eco-cities are proactively adopting waste reduction or zero-waste
programs. [1]. As a result, the zero-waste objective was incorporated into European
Union policy in 2013, and this initial plan has evolved into a comprehensive strategy for
advancing the circular economy (CE) across Europe [3].
Accordingly, the urban circular economy, as opposed to the traditional linear econ-
omy of “take, make, dispose”, represents a paradigm shift towards a more resource-
efficient model of “reduce, reuse, recycle, and remanufacture”. The circular economy
(CE) approach is rooted in the understanding that the Earth operates as a closed, cir-
cular system with finite resources, and emphasizes the need for a harmonious coex-
istence between the economy and the environment [4]. This transformative approach
holds immense promise for addressing the pressing sustainability challenges facing cities
worldwide. Thus, cities can foster economic growth, enhance environmental protection,
and promote social equity by minimizing waste generation and maximizing resource
utilization.
Even though circular economy practices in cities have shown promising results, their
implementation faces many challenges. Shifting an economic model from the traditional
linear process to the circular one necessitates the active participation and dedication of
multiple stakeholders, including producers, consumers, and policymakers [4]. Collabo-
rative value creation among these actors plays a crucial role in ensuring the success and
sustainability of this economic model, which is expected to bring about positive impacts
on the social fabric of communities, the sufficiency of the economy, and the preservation
of the natural environment.
This study aims to comprehensively assess the impacts of circular economy prac-
tices on economic growth, environmental sustainability, and social benefits at the urban
circularity level. By examining these key areas, the study aims to provide a holistic
understanding of the impacts and potential benefits associated with the implementation
of circular economy practices within urban contexts. Through this analysis, valuable
insights can be gained to inform decision-making and policy development towards more
sustainable and resilient urban environments. A literature review will be conducted to
identify the most widely adopted circular strategies in cities, followed by comprehen-
sive data collection encompassing quantitative and qualitative measures. Finally, a case
study is presented to demonstrate the implementation of a circular economy in the urban
environment.

2 Literature Review
The methodological approach for this study consists of a critical review of the literature
on CE implementation in the urban environment. The aim is to identify the most widely
adopted CE practices in cities. The literature review was conducted using the Artifi-
cial Intelligence (AI) Tool Research Rabbit (https://researchrabbitapp.com/). Research
Rabbit allows the searching in multiple academic databases, including Scopus, Web of
Science, and ProQuest.
484 A. Salles et al.

A first search was conducted by using the keywords: “urban circularity”, “case
studies”, “circular economy in the urban environment”, and “circular economy in the
built environment”. Then, to complement the first analysis was added the sentence “case
studies in circular economy practices in the urban environment”. “In this initial search,
the articles were screened to identify those relevant to the research question. By skimming
the titles and abstracts to assess their relevance, a total of 20 articles were selected.
Figure 1 illustrates the relationship between the articles.

Fig. 1. Connections between articles. Source: https://researchrabbitapp.com/.

A second search was conducted to investigate “similar works,” “earlier works,” and
“later works.” A total of 1,537 articles were identified as “similar works,” with 117
categorized as “earlier works” and an additional 293 classified as “later works.” Upon
thorough examination, 33 were identified for in-depth analysis.

2.1 Overall Analysis: Cities and the Circular Economy

Cities are the cornerstones of human life and their sustainable futures. Thus, in any
conceptualization of a circular city, these issues must be considered. With the grow-
ing profile of the CE and its potential to engage different stakeholders, alongside the
recognition of the importance of cities for addressing sustainability challenges, there is
a pressing need to understand what a future circular city might look like [1].
 Assessing the Impacts of Urban Circular Economy Practices 485

Furthermore, urban systems hold a unique potential for circularity, shaped by their
distinct social, economic, and environmental factors. CE strategies must be tailored to
the specific realities of each context, ensuring their effectiveness and alignment with
local priorities. Numerous reports have been published documenting successful efforts
to identify and harness this potential, leading to the development of tailored circular
economy implementation strategies for various urban systems [2].
The development of a CE within cities, provinces, or regions entails the integration
and redesign of four key systems. These systems include the industrial system, which
involves transitioning from small to large companies and phasing out heavily polluting
enterprises in favor of light economic activities such as high-tech industries, tourism,
or culture. Additionally, the infrastructure system delivering essential services, such
as transportation, communication, water recycling, clean energy, and electrical power
lines, needs to be reconfigured. The cultural framework and social system also require
adaptation to support the principles of a circular economy [5].
Vanhuyse (2023) [6] put forth an urban circularity assessment framework that offers
city governments and other stakeholders the ability to formulate a comprehensive CE
strategy that encompasses different scales, ranging from local to global concerns. This
framework is based on a hierarchical approach, starting with a strategic CE vision and
sustainability targets at the highest level. These goals then guide the establishment of
institutional arrangements, CE strategies, and the management of urban stocks and
flows. Moreover, this framework establishes links to the triple bottom line, ensuring
that economic, environmental, and social aspects are considered in the development and
implementation of CE strategies.

2.2 Benefits

Pomponi and Moncaster (2017) [7] emphasized the environmental benefits of circularity,
noting its potential to reduce greenhouse gas emissions and conserve natural resources.
According to Geissdoerfer et al. (2017) [8], the circular economy is a powerful tool
for sustainable development, emphasizing its ability to minimize waste and optimize
resource flows. Additionally, the CE holds the potential to comprehend and implement
transformative new patterns, enabling society to attain heightened sustainability and
well-being while minimizing or eliminating material, energy, and environmental costs
[5].
Several cities have embraced CE as an aspirational concept. While future-oriented,
multidisciplinary, and systemic perspectives hold the potential for CE to simultane-
ously address economic and social issues, empirical data on circular cities is lacking
[1]. Munaro et al. (2020) [9] conducted a comprehensive review of circular economy
applications, identifying initiatives for circular cities and the transition to a sustainable
built environment.
Hysa et al. (2020) [10] recognized the circular economy as a new governance model
for sustainability transitions, requiring strategic reframing and institutional design.
Çimen (2021) [11] examined the relationship between circular economy and sustainable
development goals, demonstrating its potential to contribute to multiple dimensions of
sustainability.
486 A. Salles et al.

2.3 Challenges and Barriers

Despite the promising evidence, implementing circular economy practices in cities
presents significant challenges. Multi-stakeholder engagement, the development of
new business models, and collaboration between cities are crucial for successful
implementation.
The CE implementation at the city level faces several barriers that include the need for
CE adaptation of design and technology, access to material information, and additional
investment for CE business models [12].
Pomponi and Moncaster (2017) [7] emphasized the importance of stakeholder
engagement in shaping circular economy policies, while Munaro (2020) [3] stressed
the need for new business models that align with circular principles. Furthermore, they
indicate the lack of awareness and understanding of the CE among stakeholders in the
construction value chain as a significant issue [9]. Hysa et al. (2020) [4] highlighted the
importance of collaboration between cities to share knowledge and best practices, while
Çimen (2021) [11] emphasized the role of government policies in promoting circularity.
According to Williams et al. (2022) [13] the absence of circular urban systems of
provision in cities stands as the primary obstacle to the adoption of circular practices.
The implementation of such systems faces two major challenges: political and eco-
nomic factors. The authors also highlighted the current conceptualizations of the CE to
incorporate a social dimension [13].
The CE agenda primarily focuses on businesses, fostering their competitiveness by
valorizing waste for circular advantage and value creation, reflecting the growth-oriented
narrative of the cradle-to-cradle framework. However, this approach may increase busi-
ness control over resources and diminish citizen autonomy. Additionally, applying CE
principles in businesses is a distinct undertaking from adopting CE in cities [1].
To address these barriers and facilitate the transition to a CE at the city level, Lee et al.
(2016) proposed several strategies. One such strategy is the sourcing of materials locally,
which reduces the need for long-distance transportation and promotes regional circularity
[14]. Another important strategy is the adoption of clean transportation methods, which
helps to minimize the environmental impact of logistics and contribute to a more sus-
tainable CE. In addition, the implementation of public policies and financial incentives
that promote material reuse, efficient waste collection, and the development of a robust
recovery market are crucial factors in facilitating the circular economy transformation
at the city level [15].

3 Discussion
Recognizing the significance of cities in addressing sustainability challenges, the urban
systems possess distinct social, economic, and environmental factors that make them
unique in terms of their potential for circularity. Hence, to ensure effectiveness and align-
ment with local priorities, circular economy strategies must be tailored to the specific
realities of each context. This has led to the development of tailored circular economy
implementation strategies for various urban systems.
The primary objective of this study is to conduct a comprehensive assessment of the
effects of circular economy practices on economic growth, environmental sustainability,
 Assessing the Impacts of Urban Circular Economy Practices 487

and social benefits specifically at the urban circularity level. A comprehensive analysis
of the literature revealed the primary strategies and their relationship with economic
growth, environmental sustainability, and social benefits, to promote circularity within
urban environments. Thus, the analysis provided a better understanding of how circular
economy practices can be used to stimulate economic growth, protect the environment,
and create social benefits in urban environments. Also, the main challenges and barriers
to implementing circular economy practices in urban environments.
The subsequent section delves into the Case Study of Amsterdam, exploring the
applicability of CE practices within the city’s unique context.

4 Case Study: Amsterdam

Since the 1980s, the Netherlands has been actively promoting policies related to the CE,
with a particular focus on increasing recycling rates and reducing the amount of unsorted
(household) waste that ends up in landfills [12].
The discussions surrounding the concept of the CE first emerged in Amsterdam in
2013. Recognizing its potential, the Amsterdam municipality included the CE concept in
its sustainability agenda in 2015. In 2016, an action agenda was launched with the ambi-
tious goal of positioning the city as a frontrunner in circularity. The Strategic Advisor
for Sustainability in Amsterdam highlighted the significance of a comprehensive action
program that prioritizes circularity, making the CE agenda even more impactful [1].
This agenda emphasized the importance of collaboration among various stakeholders,
including local businesses, companies, and citizens [1, 12, 16].
Within this action agenda, two material streams, organics, and construction, were
prioritized. For the organic stream, specific objectives were identified, including the
establishment of a biorefinery hub, the promotion of cascading organic residues (such
as biomass production), and the extraction of valuable resources like phosphate from
waste residues. To measure progress, a clear target was set: achieving a 65% organic
separation rate by the year 2020 [16].
Furthermore, Amsterdam’s spatial plan primarily focused on strategic priorities such
as job creation and housing for a growing population. However, it also recognized the
importance of waste/bio-clusters in the port area, facilitating local circular actions. To
support these initiatives, the Circular Innovation Program provided financial incentives
[13]. The spatial plan also emphasized the utilization of residual heat and the preser-
vation of green spaces within the city, both crucial for achieving circular development
(CD). These efforts were further bolstered by the Sustainability Strategy and the Cir-
cular Vision and Roadmap, which outlined specific CD goals. The implementation of
these goals was carried out through the Learning by Doing program [13]. Policymakers
acknowledge the intricate nature of the CE and recognize its complexity [1]. Despite
Amsterdam’s pioneering position in this field, it is essential the need for “experimen-
tation” due to the relatively new territory of CE and the existence of unknowns. While
there are currently limited policy instruments, there is at least some framework in place.
In terms of financing, an opportunistic approach is taken, focusing on providing support
and incentives to existing projects that show promise and align with the city’s goals. This
488 A. Salles et al.

is achieved through policy instruments such as the sustainability fund. Furthermore, pol-
icymakers emphasize the concept of creating a “future-proof” city, placing importance
on resilience and adaptability rather than solely focusing on sustainability [1].
Moreover, Amsterdam is actively embracing a circular economy approach, evident
in the numerous experiments underway across the city [1]. One notable example is the
implementation of legislative “free zones” in the post-industrial area of Buiksloterham,
where partners are encouraged to test innovative waste collection and water sanitation
methods. In 2016, Amsterdam made a significant step forward by becoming a Fab City,
a movement dedicated to exploring the potential of new city dynamics enabled by dis-
tributed urban production systems powered by advanced technologies such as 3D printing
and smart and efficient mobility and food systems [17]. The city also houses the fully cir-
cular community of De Ceuvel, a participatory living lab of a self-sufficient community
that aspires to be “at the vanguard of circular living” [18]. Residents of De Ceuvel con-
tribute to the community’s sustainability by constructing self-build homes from recycled
materials and managing their own material, energy, and food resources. This initiative
aligns with the “Manifesto for a Circular Buiksloterham,” which emphasizes the core
themes of circularity, bio-based solutions, and smart innovation [1, 18].
These efforts demonstrate Amsterdam’s commitment to advancing the circular econ-
omy and its proactive approach to promoting sustainable and resource-efficient practices
[13].

5 Conclusion
Cities are the cornerstones of human life and their sustainable futures. As the circular
economy gains traction as a sustainable development paradigm, cities emerge as crucial
actors in shaping the future of this transformative concept. The CE’s potential to minimize
waste, optimize resource flows, and foster a more sustainable future resonates deeply
with the challenges faced by urban environments.
Furthermore, cities bear the responsibility of ensuring a sustainable future for their
inhabitants and the planet. The CE presents a promising pathway towards this goal,
offering a framework for resource-efficient and environmentally responsible urban
development.
However, implementing CE practices in cities presents unique challenges, demand-
ing multi-stakeholder collaboration, innovative business models, and effective partner-
ships between cities.
Despite the nascent stages of CE implementation at the city level, the growing interest
and the increasing number of cities embracing this paradigm offer a glimpse into the
future of a circular urban landscape.
The primary objective of this study was to conduct a comprehensive assessment of the
effects of circular economy practices on economic growth, environmental sustainability,
and social benefits specifically at the urban circularity level. A comprehensive analysis
of the literature revealed the primary strategies and their relationship with economic
growth, environmental sustainability, and social benefits, to promote circularity within
urban environments. The case study of Amsterdam was presented to illustrate the imple-
mentation of CE practices in an urban environment. Amsterdam’s unwavering dedica-
tion to the circular economy has propelled the city into a frontrunner position. Through
 Assessing the Impacts of Urban Circular Economy Practices 489

a comprehensive strategy that prioritizes collaboration, Amsterdam has successfully

implemented numerous initiatives to foster circular practices. These efforts serve as a
testament to the city’s visionary approach to sustainability and resource-efficient prac-
tices. Amsterdam stands as a beacon of hope, demonstrating the transformative potential
of the CE through its unwavering commitment and proactive initiatives.

Acknowledgments. This research received no external funding. The authors of this paper would
like to thank the European Union for funding and COST (European Cooperation in Science and
Technology) for supporting the COST Action CircularB CA21103 (www.circularb.eu).

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