Abstract:

This study analyses the transformation of industrial parks to eco-industrial parks from a new institutionalist theoretical perspective. The worsening climate crisis has made the existing Linear Economic (LE) system dysfunctional; thus, a need for systemic change has emerged across the globe. As a result of this need, the idea of Circular Economy (CE) has gained popularity. The CE particularly aims to replace the linearity in economic actions originating from the LE’s “take-make-use-dispose” logic with the circularity of economic actions constructed through a “recycle-reuse-reduce” logic. At this point, the transformation of industrial parks to eco-industrial parks in line with the CE principles constitutes a useful case to see how the idea of the CE can be institutionalized. The study argues that the market actors cannot effectively initiate this transformation due to their short-run interest calculations and path-dependence on the existing LE system. On the other hand, the state with its strong institutional power could play a catalyst role accelerating this transformation process. In particular, the state could provide regulative, financial, technological, and societal network support to the market actors to deal with their dependence on the LE system. However, the state should become entrepreneurial, but not interventionist in this process. It should have a horizontal governance approach and put infrastructural help, communication, networks and learning at the centre. This means that the state should become a path-opener but not the dominator of the mentioned transformation process. Therefore, rather than obsessive ideological debates over the state versus the market, the focal point should be the proper functionality of the state and market in the establishment of a sustainable circular system to cope with the worsening climate crisis.

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