Digitalization as a driving force of business models of a closed-cycle economy

Introduction. New cyclical business models can develop at all stages of the product lifecycle. Digitalization can lead to breakthrough innovations, new business models and new ways of cooperation and, thus, accelerate the economic transition to more resource-saving and closed production systems.

Goal. The study of the features of digitalization as a driving force of business models of the closed-cycle economy.

Materials and methods. There is little empirical research on the stimulating role of digitalization in a closed-loop economy. To eliminate this gap, the article explores the role of digitalization in simplifying cyclical business models based on an empirical analysis of a data set of 599 Russian manufacturing firms and 296 industrial service providers.

Results and discussion. While relatively few Russian firms rely on new business models to implement their resource efficiency strategy, we believe that this share is higher for companies with a strong focus on digital technologies in the manufacturing sector. This suggests that digitalization can indeed become the driving force behind the introduction of cyclical business models.

Conclusion. The integration of cyclicity into business models is a key lever for the transition to a closed-loop economy. Despite the fact that it is widely recognized that digitalization causes disruptions in a wide range of areas, there is not enough literature linking this concept with the closed-loop economy and confidence-building measures as a means of contributing to disruptions in the closed-loop operation. This article examines this gap by conceptualizing cyclical disruption, which can become a key factor in accelerating the transition to a closed-loop economy. There is a wide range of DTS that can contribute to the breach of mutual responsibility and innovative ways of doing circular business discussed in this article.

1. Official website of the Association of Innovative Regions of Russia. Available from: https://www.i-regions.org/ [Accessed 19 June 2023].

2. Rating of Russian regions on scientific and technological development. Available from: https://ria.ru/20211025/tekhnologii1756053678.html?in=t [Accessed 24 May 2023].

3. Official website of the Ministry of Economic Development of the Stavropol Territory. Available from: http://www.stavinvest.ru [Accessed 26 April 2023].

4. Lapaev S. P., Lapaeva L. V. Sources of financing for innovative development of the region. Vestnik Orenburgskogo gosudarstvennogo universiteta = Bulletin of the Orenburg State University. 2021;132:312-320. (In Russ.).

5. Cherkovets V. N. On the issue of the institutional environment of innovative development. Novyj universitet = New university. 2019;10:57-61. (In Russ.).

6. Official website of the Ministry of Economic Development of the Stavropol Territory). Available from: http://www.stavinvest.ru. [Accessed: 12 June 2023].

7. Borovskaya L. V. Institutional environment and features of its formation as a result of institutional changes. Vestnik Voronezhskogo gosudarstvennogo universiteta = Bulletin of Voronezh State University. 2020;26:5-12. (In Russ.).

8. Kochetkova S. A. Public-private partnership: a textbook. M.: Publishing House of the Academy of Natural Sciences, 2019. Р. 174. (In Russ.).

9. Semenova N. N. Public-private partnership in the innovative development of the Russian Economy. Ekonomika. Nalogi. Pravo = Economy. Taxes. Right. 2022;3:59-69. (In Russ.).

10. Kashirin A. I. Innovative Business: Venture and Business Angel Investing: Textbook. M: ID Case RANKhiGS; 2020. Р. 260. (In Russ.).

11. Official website of the Stavropol Krai Development Corporation. Available from: https://razvitie-stav.ru/ [Accessed 29 May 2023].