Abstract
A trend arises among industrial and government sectors to transition from the conventional economic system to the new Circular Economy. Its benefit of material security, resource efficiency, and economic growth has attracted government institutions and business sectors to adopt the new trend. However, its challenge falls on the real complexities of economic systems. Adoption of the Circular Economy requires careful consideration of possible challenges. Previous works have aimed to identify the drivers of Circular Economy through surveys based on the frequency of data. The results provided useful information for the decision making of the transition. However, it is also limiting as it does not address a plausible chain-like effect of the drivers which can aid stakeholders determine which course of action is necessary for an efficient transition. Hence, this study is focused in determining these causal drivers by using the DEMATEL approach. DEMATEL is a methodology that identifies the cause and effect relationship between drivers, of which, it can then determine the top causal driver. The study uses a case study in the Philippines to illustrate the capability of the methodology of determining the causality between drivers of Circular Economy. The results of the case study were able to identify ‘economic attractiveness’, with a net cause/effect value of 1.22, and ‘consumer demand’, with a net cause/effect value of 0.87, as the main causal driver while ‘company culture’, with a net cause/effect value of -1.22, as the main effect. The result implies that the improvement in the circular business models and increase in customer awareness are the top priority for the transition. The application of this work is intended to provide researchers an alternative approach in identifying the critical causal drivers of Circular Economy.
