The puzzle of the informal economy and the circular economy

Abstract

Proponents present the circular economy as an alternative to traditional, linear systems that use natural resources indiscriminately. The puzzle guiding this perspective piece is that the circular economy model needs further investigation in more diverse, unstructured contexts. With economic growth at the top of the agenda for Global South countries, testing the relevance of the circular economy in these contexts is important. There remain questions about whether the adoption and upscaling of circular principles and practices can contribute to economic development in contexts where social factors, such as high inequality, collide with environmental factors, such as high natural biodiversity. Another blind spot concerns how the structural conditions in Global South countries, such as vast informal economies, hinder this transition, and what new forms of organisation can facilitate the implementation of innovative circular practices. This perspective calls for greater attention from the academic community to help fill in some of the missing pieces in the puzzle of the informal economy and the circular economy.