Interview with Annukka Berg, Researcher at the Finnish Environment Institute (Syke), on Circular Economy Solutions

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Q: Can you tell us about the relationship between your consumption habits and the sharing economy?

A: The sharing economy represents a new consumption model that places less burden on the general economy. However, it may require changing certain established consumption habits. For instance, items like sewing machines or recording equipment are not available for immediate use as they need to be rented or shared. The younger generation might be more adaptable to this model compared to older generations who are used to owning things. For instance, some Finns purchase summer cottages that they only use during specific times, leaving them idle for the rest of the year, even though they might be far away. Despite additional transportation costs, older individuals may resist changing their consumption patterns due to familiarity. Promoting the sharing economy requires effort in overcoming this resistance.

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From a policy perspective, developing such business models entails understanding various challenges consumers face when engaging in the sharing economy, and advocates need to proactively address potential difficulties. Unlike traditional economies, the sharing economy is more community-based. Examples include neighborhood car-sharing or borrowing a drill from a neighbor. Finland's Oodi Library also offers many items for rent.

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Q: What do you believe is the development potential of the sharing economy? If businesses are interested in moving in this direction, what advantages could attract them, or what issues might they encounter?

A: Given the increasing global population, compared to a linear economy, a circular economy is essential to reduce resource consumption. However, the sharing economy doesn't always necessarily decrease natural resource consumption and may even create unnecessary demands, such as festival clothing. Thus, this is a consideration when offering services.

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A study on the product life cycle in Northern Europe found that while the region hasn't substantially reduced natural resource consumption, recycling and reuse efforts have been successful. The sharing economy not only saves on transportation costs but also provides flexibility and the ability to handle unexpected situations. This emerging sustainable economic model is favorable for the environment, economy, and even provides new job opportunities.

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Note: Circular Economy emphasizes maximum resource reuse and waste reduction, promoting product cycles and material recycling for sustainable development. Linear Economy treats resources as cheap and unlimited, focusing on rapid production and consumption, leading to excessive resource depletion and environmental impact.

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Q: Could you share any intriguing sharing economy topics or business models that caught your attention?

A: Various sharing initiatives have emerged in Nordic countries in recent years, encompassing transportation, housing/accommodation, small capital goods sharing/leasing, and personal services. These plans might offer substantial benefits to consumers, with higher service quality or lower prices. Additionally, they have the potential to reduce CO2 emissions and local pollutants. However, differing lower prices or consumer demands could lead to increased service requirements, subsequently increasing carbon emissions. For example, in transportation, the overall impact on CO2 emissions depends on whether emissions are taxed, included in the EU emission trading system, or not monitored at all.