Ecosystem Approach to Shaping a Circular Economy: Barriers and Incentives for Investment Support

Abstract

The aim of the study was to determine the configuration of financial, institutional, technological and coordination factors associated with the transition from fragmented resource-reuse practices toward more sustainable inter-organizational interaction. A mixed empirical design combined panel analysis of 27 European Union countries for 2022–2024 with a survey of 210 industrial enterprises in Germany, Poland, Italy, Spain, the Czech Republic, the Netherlands and Ukraine. Ukraine was considered separately because of incomplete statistical comparability and war-related conditions. Circular material use in the European Union increased from 11.5% to 12.2%, while substantial cross-country differences persisted. The panel model revealed positive associations with corporate environmental investments, resource productivity and municipal waste recycling. In the survey, the strongest positive relationship was between investment activity and ecosystem interaction, ? = 0.61, whereas financial barriers showed the strongest negative association, ? = –0.58. Financial incentives were positively associated with investment activity, ? = 0.54. Among enterprises with low ecosystem interaction, 8.7% reported high investment activity, compared with 55.2% among those with high interaction. Financing was more frequently used as a strategy-validation mechanism when decisions incorporated confirmed material flows, demand, partners and risk-sharing arrangements. The threshold-like differences were consistent with a descriptive phase-transition interpretation but did not establish a universal threshold or causal mechanism.