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The economic implications of increased product longevity

Cooper, Tim; Qasim, Saira

FG Transdisziplinäre Nachhaltigkeitsforschung in der Elektronik

Interest in product longevity has increased across Europe in recent years. To date, however, little attention has been paid to the implications for national economies if a higher proportion of consumer durables were to be designed and manufactured for longer lifetimes, average lifetimes increased, and product replacement cycles slowed. This lack of knowledge is problematic for several reasons. First, it is important that the implications of increased product longevity for traditional economic goals such as growth, low unemployment and a satisfactory balance of trade are understood. Second, if public policy support is required for such a strategy on environmental grounds, the economic implications need to be understood in order to leverage support from governments’ finance and economics departments. This paper reviews the current state of knowledge on product lifetimes from the perspective of economics, drawing upon literature from academia, public bodies and policy organisations, and including recent studies on the circular economy. It concludes that the evidence base on the macroeconomic implications of increased product lifetimes is inadequate, while noting that studies have identified potential growth, employment and trade benefits. There is also inadequate understanding of how microeconomics might be applied to product lifetimes. Too few economists have engaged with this topic; a research agenda is urgently required.