- Item type
- Study and report
- Publication year
- 2025
- Note
In response to grand challenges, the linear economic model (make, use, dispose) is increasingly contested by a circular economic model. A circular economy operates on the principles of reduce, reuse, recycle, and recover, enabled by technological innovations, novel business models, and stakeholder collaboration. Positive impact the circular economy promises is often offset when circular products cannot fully replace linear products due to being inferior in quality or price, while often targeting a different market. The simultaneous production of linear and circular products leads to additional production and is widely coined 'circular economy rebound'. Systemic innovation in terms of products, services, business models, and ecosystems is understood as a key aspect in circular economy rebound mitigation. However, extant literature mainly describes phenomena related to the circular economy and rebound effects, while largely neglecting descriptive and prescriptive accounts of systemic innovation and external enablement in the context of the circular economy. For instance, businesses lack guidance on how to utilize digital technologies and systems thinking to innovate for and develop a well-functioning circular economy while considering rebound effects. Additionally, current literature to a great extent remains in a descriptive mode largely focusing on circular business models, failing to apply a systemic view, including circular products, services, and ecosystems, or an external enablement view. Current literature rarely makes the leap to bridging the gap between theory and practice through dedicated research approaches such as design science research. In consequence, scholars, new ventures, and established firms lack knowledge and guidance on how to innovate within the circular economy guardrails to deliver on its impact promises. The purpose of this dissertation is to advance knowledge of the theoretical issues linked to a circular economy and its underlying systems as well as external enablers such as artificial intelligence as a digital technology. Based on these theoretical aspects, this dissertation aims to provide prescriptive guidance on how to innovate for and develop a well-functioning circular economy by bridging the gap between theory and practice through applying design science research approaches. This is accomplished by three separate but interrelated manuscripts underlying this dissertation. The first manuscript adopts an inductive and descriptive qualitative research approach, conducting 55 semi-structured interviews with artificial intelligence and circular economy experts, as well as new ventures that utilize AI-enabled circular economy business models. Using the Gioia-method for data analysis, the first manuscript develops a general model of the circular economy enablement through artificial intelligence as a digital technology and external enabler. Additionally, it introduces a typology of circular economy enabling artificial intelligence business models. The second manuscript addresses the intricate but often fragmented design of circular systems, encompassing circular product design, product-service system design, circular business model design, and collaborative ecosystem design, leading to circular economy rebound. This study uses a qualitative, inductive design science research approach, including 31 semi-structured interviews and a workshop with circular design experts and entrepreneurs. Through the Gioia-method of data analysis, the manuscript presents a process blueprint of circular systems design targeted at circular economy rebound mitigation. The third manuscript leverages 37 semi-structured interviews with entrepreneurs and experts in the domains of cascading and repurposing. Through a design science approach and structured data analysis using the Gioia-method the manuscript develops five design principles following a context, intervention, mechanism, outcome (CIMO) logic. The design principles inform entrepreneurs operating in the CE on how different key stakeholders can engage in productive partnerships to operationalize cascading and repurposing business models effectively.
