Construction waste management based on the principles of circular economy

Abstract

It was determined that construction belongs to the fundamental structure of economic activity, that is, to the types of activity that are immanently inherent and ensure the existence of humanity. Analysis of the state of the construction industry in Ukraine at the beginning of 2022 revealed that the industry’s contribution to the creation of GDP in the last ten years did not exceed 3%, which is half the average figure in EU countries. It is emphasized that until 2022, the industry demonstrated positive dynamics (except 2013-2014); at the same time, no dependence was observed between the dynamics of the specific weight of the industry in GDP, physical volumes of construction, gross added value, and the contribution of the industry to the amount of taxes paid. A trend in construction industry entities’ organizational and legal structure was revealed: an increase in the number of enterprises and a decrease in the number of individual entrepreneurs. The peculiarities of taxation explain the trend and the institutional structure of Ukraine’s socio-economic and political environment. It is noted that the factors of demand, supply, and institutional environment influence the functioning and development of the construction industry. It was determined that the full-scale Russian military invasion caused enormous damage to buildings and infrastructure, one of the consequences of which was the actualization of the issue of disposal of construction waste. The thesis that construction and demolition waste management should be based on circular economy principles is substantiated. It is proposed to analyze the construction waste disposal process using A. Pigou’s concept of externalities: construction waste is a negative externality, the elimination of which is possible through state regulation using a system of instruments of institutional, administrative, and economic influence. It is noted that construction waste management based on the principles of the circular economy, considering positive foreign experience, will make it possible to effectively use limited financial resources, reduce the negative impact of waste on the environment, and create acceptable social conditions for people’s lives. Keywords: construction industry, circular economy, negative externalities, construction and demolition waste, construction waste management.