The Functional Economy: A Critical Review of the Model Based on Case Studies and a Consumer Survey

Details

Supervisors

Kestemont, Marie-Paule

Faculty

Louvain School of Management

Degree label

Master [120] en sciences de gestion

Abstract

Although the concept of functional economy, i.e. the idea of using a product as a service rather than owning it, has been around since the 1980s, the model still plays a marginal role in the overall economy today and a key question is to understand the reasons why. More specifically, the objective of this thesis is to derive a sound conceptual framework, to understand the underlying conditions for the model success or failure and finally, to examine the current attitude of consumers towards the environment and the functional economy concept. This is addressed by (i) presenting a review of the literature on the subject, (ii) an analysis of several case studies and (iii) the results of a consumer survey. The conclusions identify three main elements: (i) a lack of clear practical guidelines in the theoretical framework of the functional economy model, (ii) the existence of specific business characteristics that favor or not the model implementation and (iii) the current relative reluctance of many consumers to at least some of the model practical applications.