Do Circular Economy Interventions Improve Institutional Sustainability? Micro-Level Evidence from Waste-to-Energy and Additive Manufacturing Systems

Abstract

This study examines whether circular economy interventions improve institutional sustainability within resource-constrained settings, using micro-level evidence from an integrated waste-to-energy and additive manufacturing system implemented in a large health and research institution in The Gambia. While the circular economy has gained prominence as a strategy for addressing environmental and resource challenges, empirical evidence on its institutional-level impacts particularly in developing countries remains limited. Drawing on circular economy theory, institutional economics, and the resource-based view, the study conceptualizes circular economy adoption as a multidimensional intervention influencing environmental performance, economic efficiency, and operational effectiveness. Using primary data derived from the implementation of the Greatwaste project, the analysis employs Ordinary Least Squares (OLS) regression models to estimate the relationship between circular economy adoption and institutional sustainability outcomes, while accounting for the moderating role of institutional capacity. The findings indicate that circular economy interventions significantly improve environmental performance, including measurable reductions in greenhouse gas emissions, and enhance economic efficiency through cost savings in energy and material use. More importantly, the results reveal a strong positive effect on institutional sustainability, suggesting that circular economy adoption functions as a mechanism of organizational transformation rather than merely a technical solution. The analysis further shows that institutional capacity significantly moderates these relationships, with stronger impacts observed in contexts with better infrastructure, technical expertise, and coordination mechanisms. The study contributes to the literature by providing micro-level empirical evidence on integrated circular economy interventions in a Sub-Saharan African context and by demonstrating their multidimensional impact on institutional performance. The findings underscore the importance of combining technological innovation with institutional capacity development to achieve sustainable and scalable outcomes.