Unconventional path dependence: How adopting product take-back and recycling systems contributes to future eco-innovations

Haiyan Wang*, Donato Masi, Lalitha Dhamotharan, Steven Day, Ajay Kumar, Tong Li, Gurmeet Singh

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review


Eco-innovation (EI) allows organizations to achieve environmental and economic gains but the conditions for successful EI to occur are unclear. This paper proposes that firms can improve their EI performance by adopting circular economy (CE) systems and technologies, such as product take-back and recycling. We thus explore an unconventional, systems- and technology-driven path dependence dynamic leading to higher EI performance because of prior CE commitments (instead of managerial initiatives directly aimed at fostering EI). An analysis of 724 firms shows that the adoption of such technologies and systems puts firms on a sustainability path: firms benefit from making further changes to improve the functioning of these systems, which in turn create the conditions and capabilities for future EIs. Environmental supply chain policies thus mediate the relationship as the firm adopting take-back and recycling needs to involve outside partners in their administration. Neither environmental management systems nor data protection policies act as mediators. This is the first quantitative study that considers take-back and recycling and EI scores with a cross-national-cross-sectorial sample size. The results indicate that firms should see the introduction of CE systems and technologies as an opportunity for EI.

Original languageEnglish
Pages (from-to)707-717
Number of pages11
JournalJournal of Business Research
Early online date17 Jan 2022
Publication statusPublished - Mar 2022

Bibliographical note

© 2022, Elsevier. Licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International http://creativecommons.org/licenses/by-nc-nd/4.0/

Funding Information:
Haiyan Wang is grateful for funding from the National Natural Science Foundation of China (Grant No. 91746202; 71433006).


  • Circular economy
  • Eco-innovation
  • Environmental management systems
  • Environmental supply chains


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