Analyzing cause and effect relationships among drivers and barriers to circular economy implementation in the context of an emerging economy

The circular economy (CE) concepts have attained great attention to achieve sustainable development goals. However, the implementation of CE requires identifying its drivers and barriers. These drivers and barriers further require identification of the pathways to execute the implementation plan. To address this gap, this study explores the drivers and barriers of CE implementation to evaluate their cause and effect relationships and implementation pathways in the context of the Pakistani manufacturing industry – an emerging economy. The results show that resource efficiency sits at the top of the list of internal drivers. Among the external drivers, support from parent company, social responsibility, and international competition and push appear as equally important drivers of CE. The results on the external barriers show a significant role of all three barriers: lack of government policies, lack of industrial support, and lack of supply chain integration and effects of supply chain complexity. Reduction of cost exhibits its multi-faceted effect on profitability/market share and customer-supplier relationship, and lack of expertise affects profit and market demand level. The study provides valuable guidelines for managers and policymakers to develop strategic approaches for CE adoption and transition manufacturing organizations of emerging and developing economies to sustainability.