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Prep 1 · Economics
The environment as a source of ideas and opportunities · The social, cultural and environmental environment

Collaborative, circular, social, and solidarity economy

A cell phone with a broken screen can end up in a drawer, in a landfill, or at the repair stall around the corner. These are different ways of organizing the economy, and the difference is measured in the resources the planet has left. Which path is best for society? We answer it at the end of the page.

Linear economy versus circular economy

Natural resources are scarce, and economics studies how we produce, distribute, and consume under that scarcity. The linear model uses up resources and generates waste; the circular model aims for each resource to go around more times. This diagram shows the life cycle of school clothing, in the order in which it happens:

Circular economy cycle for school clothing with the stages in order: produce, use, repair, reuse, and recycle. Produce Use Repair Reuse Recycle
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Explain the difference between a linear economy (make → use → dispose) and a circular economy using the example of a cell phone: what happens to it in each model when…

Explain the difference between a linear economy (make → use → dispose) and a circular economy using the example of a cell phone: what happens to it in each model when you stop using it?

Solve
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The diagram shows the circular economy cycle applied to clothes in the school locker, but one of the stages is covered with a question mark. a) State which stage is…

The diagram shows the circular economy cycle applied to clothes in the school locker, but one of the stages is covered with a question mark.

Produce Use ? Reuse Recycle
  1. a) State which stage is missing between 'use' and 'reuse' (extending the garment's life by repairing it) and explain why it is the preferred option before recycling.
  2. b) Go through the cycle with a school hoodie: what happens to it at each stage if the system works well?
Solve

The three Rs and their hierarchy

Hierarchy of the three Rs: reduce and reuse as priorities and recycle as the last option. 1. Reduce 2. Reuse 3. Recycle

One way to measure impact is the ecological footprint: the area of the planet (in global hectares) needed to produce what we consume and absorb our waste. Calculating it in full is complex, so to compare two specific options we use a simpler measure: how many bottles are used and how much impact it costs to make each one.

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The ecological footprint measures the impact we generate. Calculate this comparison: one single-use plastic bottle per day during the school year ($200$ days) versus a…

The ecological footprint measures the impact we generate. Calculate this comparison: one single-use plastic bottle per day during the school year ($200$ days) versus a reusable steel bottle that lasts $5$ school years.

  1. a) How many plastic bottles does each option consume over $5$ school years ($1,000$ days)?
  2. b) If manufacturing the steel bottle is equivalent to $30$ plastic bottles, from which day onwards is it worth using the reusable one? Explain your calculation.
Solve

Collaborative, social, and solidarity economy, and local development

Three circles summarizing the collaborative economy (sharing), the social and solidarity economy, and local development (money nearby). Collaborativesharing Social andsolidarity Localmoney nearby

A cooperative is a business whose members are at the same time workers or users: each person has one vote, decisions are made in an assembly, and the profits (surpluses) are shared among the members or reinvested. A business owned by an investor, by contrast, makes decisions to maximize the owner's profit.

Let's see how money that circulates nearby "multiplies" with an example using illustrative figures.

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The sharing economy consists of sharing underused resources. Classify these examples as sharing economy or not and justify your answer: (a) a neighborhood board game…

The sharing economy consists of sharing underused resources. Classify these examples as sharing economy or not and justify your answer: (a) a neighborhood board game library; (b) buying a drill that you will use twice in your life; (c) the school textbook program; (d) renting a vacation apartment managed by a company with $200$ apartments.

Solve
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A local greengrocer is considering turning into a worker cooperative: the employees would be owners and make decisions in an assembly, sharing the profits among…

A local greengrocer is considering turning into a worker cooperative: the employees would be owners and make decisions in an assembly, sharing the profits among themselves.

  1. a) Compare its objectives with those of a chain greengrocer owned by an investor: what changes in decisions regarding prices, wages, and suppliers?
  2. b) Analyse two advantages and two difficulties of the cooperative model for this specific case.
Solve

Externalities, the SDGs, and real cost

The SDGs help direct small projects toward measurable goals. A uniform and book exchange point can support "sustainable cities and communities" and "responsible production and consumption," and it is measured with a number each month (items exchanged, kilos reused).

A school clothing exchange project contributes to two SDGs: sustainable cities and responsible consumption. School project(clothing exchange) SDG:sustainable cities SDG:responsible consumption
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The Sustainable Development Goals (SDGs) are $17$ global targets (no poverty, clean energy, sustainable cities, responsible consumption and production…). Choose two SDGs…

The Sustainable Development Goals (SDGs) are $17$ global targets (no poverty, clean energy, sustainable cities, responsible consumption and production…). Choose two SDGs that fit this school project: 'a school uniform and textbook exchange hub'. Explain what the project contributes to each one and how you would measure it (what number you would record each month).

Solve
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A 'fast fashion' chain sells T-shirts for $\$80$ that last $10$ washes; a local brand sells T-shirts for $\$400$ that last $100$ washes. a) Calculate the cost per wash…

A 'fast fashion' chain sells T-shirts for $\$80$ that last $10$ washes; a local brand sells T-shirts for $\$400$ that last $100$ washes.

  1. a) Calculate the cost per wash for each T-shirt and discuss which one is truly "cheaper".
  2. b) Analyse what other costs do not appear in the price of the $\$80$ T-shirt (environmental and social) and who pays for them.
Solve
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Every year your school generates whole cupboards of lost property, abandoned books, and broken sports equipment. Design a circular system for the school: what is…

Every year your school generates whole cupboards of lost property, abandoned books, and broken sports equipment. Design a circular system for the school: what is collected, how it is sorted (repair, reuse, recycle), who manages it, and how it is funded. Provide two indicators to check that it works (kg reused, % of material recovered…).

Solve

Back to the beginning: repairing the phone screen applies the circular model: it extends its useful life, saves raw materials, and avoids waste, as opposed to the linear path of throwing it away.

Summary

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