BEYOND LINEAR MODELS: FACTORS DRIVING ENVIRONMENTAL ACTION AND CIRCULAR ECONOMY TRANSITION IN WESTERN BALKAN BUSINESSES

Abstract

This article employs a probit model to analyze the determinants influencing businesses in the Western Balkans to mitigate their environmental impact and assess the feasibility of transitioning to a circular business model. It relies on primary survey data gathered in all Western Balkan countries by professional research agencies in 2022, with a representative sample of approximately 200 businesses per country. The findings reveal that factors such as being an exporting, foreign, innovative, and loan-receiving company increase the likelihood of businesses in the Western Balkans taking measures to reduce their environmental impact. Moreover, being an exporting and loan-receiving company emerges as influential in fostering the belief that a shift to a circular business model is attainable. These insights have profound implications for policymakers and businesses aiming to promote sustainable practices and circular economy initiatives within the Western Balkans. Additionally, this article contributes to policy development and knowledge on environmental and circular practices in developing economies.