Impact of the circular economy on biodiversity, climate and well-being in Belgium: an exploratory study by VITO
In a recent study commissioned by the Federal Public Service for Public Health, Food Chain Safety and Environment, a multidisciplinary team of VITO experts investigated the impact of the circular economy on biodiversity, climate and well-being in Belgium. The transition to a circular economy implies a fundamental systemic shift: effects are felt across the economy, the environment and social well-being, and these influences continuously interact. This interconnectedness is still insufficiently visible today, making it challenging to accurately assess the impact of circular measures. The study therefore focuses on identifying suitable modelling approaches for complex policy questions, with special attention to systems thinking and the planetary boundaries of our economy.
Objectives of the study
The study had the following objectives:
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to conduct a broad inventory of existing literature on the transition to a circular economy and its relationship with climate change, biodiversity, well-being and prosperity;
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to design and validate a qualitative model to graphically structure these relationships;
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to translate the model into an indicative simulation model that can compare the impact of policy measures in different scenarios.
Literature review and modelling approaches
VITO experts began with an extensive literature review of different methods such as input-output analysis, life-cycle assessment and system dynamics modelling. System dynamics models are particularly well suited to transparently illustrate the complex interactions, feedback loops and long-term effects of policy measures. They provide insight into the key levers for policy aimed at the transition to a circular economy.
Causal Loop Diagram
Based on insights from the literature and stakeholder input, the researchers developed a Causal Loop Diagram (CLD). The diagram shows the relationships between circular measures, system indicators and societal objectives, and illustrates how social, technological and economic factors influence one another. This enables policymakers to better assess the effects of their choices, set priorities and make well-founded decisions.
Although the focus in this first phase is on the influence of the circular economy on climate change, biodiversity and socio-economic aspects, the intention is to expand this to other domains in the future, such as health and human rights.
Test case: car sharing
In consultation with the commissioning authority, car sharing in a hypothetical city was chosen as a test case to evaluate the feasibility of the method and test quantifiability. The case was used to reason back to a more general base model for the circular economy. A causal loop diagram was developed for this purpose during a co-creation process with relevant stakeholders and experts.
Base models
Based on the causal loop diagram and the model for the test case, VITO developed two generic base models:
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one for product-based circular economy strategies, focusing on reuse, repair and extending product lifetimes;
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one for service-based circular economy strategies, centred on services such as shared use of products or functional sales.
These models allow the impact of circular measures on broader societal objectives to be demonstrated, including indirect effects and dynamic feedback loops.
Impact of the study
Societal impact
The project increased awareness among stakeholders and policymakers about the added value of systems thinking in circular policy development. The model supports the identification of side effects, leverage points and tipping points.
Scientific and policy impact
The study demonstrates that system dynamics models are valuable tools for structuring and evaluating policy measures in the circular economy, even in a design phase and with limited data.
Future developments
The study highlights the value of systems thinking and system dynamics modelling for policy development related to the circular economy. Several development directions are conceivable for further policy support:
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thematic deepening: adding more detail to model structures;
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thematic broadening: integrating new elements and sectors;
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validation: adjusting model structure and behaviour using additional data, expertise and recommendations.
The study shows that system dynamics models are a valuable instrument for policymakers. They make it possible to map side effects, leverage points and potential tipping points of circular measures. For the Federal Public Service for Public Health, this research represents an important step toward developing policy tools that support the transition to a sustainable and circular society.
