Journal of Environmental Treatment Techniques  
2020, Volume 8, Issue 2, Pages: 872-833  
J. Environ. Treat. Tech.  
ISSN: 2309-1185  
Journal web link: http://www.jett.dormaj.com  
Modeling of Factors of Development of Cyclic  
Economy at the Meso Level  
1
1
2
Irina V. Zhukovskaya *, Marina V. Shinkevich , Anzhelika V. Vasilyeva , Maxim V.  
3
4
5
Zinchenko , Natalia V. Berezina , Natalia F. Popova  
1
Department of Logistics and Management, Kazan National Research Technological University, Kazan, Russian Federation  
Department of Economy and Management of Organization, Amur State University, Blagoveshchensk, Russian Federation  
Department of Economic Theory and Public Administration, Amur State University, Blagoveshchensk, Russian Federation  
2
3
4
Department of Finance, Credit and Economic Security, Chuvash State University, Cheboksary, Russian Federation  
5
Department of Legal Regulation of Economic Activity, Financial University under the Government of the Russian Federation, Moscow, Russian  
Federation  
Received: 18/12/2019  
Accepted: 19/03/2020  
Published: 20/02/2020  
Abstract  
The article presents modeling of factors of development of a cyclical economy at the mesoscale. The relevance of the article is due  
to the fact that the issues of the development of a cyclical economy and its influence on trends in the industrial sector have not yet been  
fully resolved and require additional study and systematization of the factors that determine it. The purpose of the article is to  
summarize theoretical approaches to managing the cyclical economy at the mesoscale and to analyze its implementation. As the main  
research methods, the article used methods of description, comparison, generalization, analysis and synthesis, descriptive statistics, and  
regression analysis. Based on a synthesis of theoretical approaches, the basic principles of managing a cyclical economy are identified.  
The article provides a systematization of the trends of cyclical economics and industrial production for the mesoscale of the economic  
system. The obtained results of the regression analysis allow calculating the growth of industrial production based on the elasticity  
factors of the model using indicators of the cyclic economy, which can be used to develop environmental monitoring programs and  
projects for introducing the fundamentals of the cyclic economy in industrial enterprises.  
Keywords: Cyclical economy, Industrial production, Mesoeconomic system, Gross value added, Ecology, Rational use of natural  
resources, Modeling  
1
Introduction1  
A generalization of theoretical approaches to the  
concept of a cyclical economy and the principles of its  
management;  
The mega economics entering the active phase of the  
formation of a new technological structure posed new urgent  
problems and tasks for the scientific community, the solution  
of which cannot be found under the conditions of the linear  
model currently in force in most economies. Given the  
shortage of material resources, volatility in the market for raw  
materials prices, significant costs for warehousing and freight  
forwarding services in the production and sale of products, the  
potential of a linear economy will soon reach its limit [1].  
These issues are becoming relevant not only for mega and  
macroeconomic systems, but are also of paramount  
importance for the development of mesoeconomics, as an  
integral part of the national economic system. As an example  
of trends in the development of a cyclical economy, the  
experience of the mesosystem (regional industrial complex)  
can be considered, where the problems of resource  
Analysis of trends in the main aspects of the  
development of a cyclical economy at the mesoscale;  
Building a regression model of the influence of the  
parameters of the cyclical economy on the growth of the  
formed gross value added of the industrial sector of the  
mesoeconomic system.  
The problems of forming sustainable economic relations  
are addressed in the studies of the following authors: S.K.  
Sahu & K. Narayanan [3], C. Carpenter [4], M.E. Narandja, S.  
Howes and B. Fattahi [5]. The issues of the management  
methodology for achieving the sustainability of the  
functioning of the mega and macroeconomic economies are  
the subject of works: Y. He and B. Lin [6], K.  
Andriuskevicius [7], N. Edmonson [8], Zh. Wang [9] and  
others. Thus, the cyclical economy can be characterized as a  
system, the achievement of sustainable development of which  
is dictated by the balance and unity of the social,  
environmental and economic subsystems, which also include  
issues of material and technical production and consumption  
of products (Figure 1).  
conservation, achieving  
a
balance of production,  
environmental and economic subsystems are considered as  
key to achieving sustainable development of the  
mesoeconomics [2]. The purpose of the article is to generalize  
theoretical approaches to the issues of managing the cyclical  
economy at the mesoscale and to analyze its implementation  
for the mesoeconomics. The objectives of the article are:  
Corresponding author: Irina V. Zhukovskaya, Department  
of Logistics and Management, Kazan National Research  
Technological  
University,  
Kazan,  
Russia.  
E-mail:  
irina.zh072@yandex.ru.  
8
27  
Journal of Environmental Treatment Techniques  
2020, Volume 8, Issue 2, Pages: 872-833  
Economic subsystem:  
-
Production  
Sphere of  
-
consumption  
Cyclic economy  
Ecological  
subsystem  
Social subsystem  
Figure 1: The structural components of a cyclical economy  
Achieving these goals becomes possible due to the  
solidification of business models of key partners in industrial  
and economic activities, as well as consumers in the process  
of use and disposal of products [12]. Thus, the basic principles  
of managing a cyclical economy are: the unity of all  
subsystems of society, open business models, cooperation  
between manufacturers, suppliers and consumers throughout  
the chain of creation, use and disposal of products, the  
introduction of innovative technologies in production and  
management.  
plays a paramount role in the supply chains of final products  
in the development of a cyclical economy.  
National culture is one of the most documented levels of  
culture in the literature of authors of different directions, the  
cultural dimension, fueled, in some cases, by an ethno-  
historical perspective. In this sense, Kulholn and Strodtbek,  
two anthropologists who developed the very first  
proportionate approach to culture, drawing inspiration from  
the works that philosophers and sociologists have used for  
centuries. Their works include studies of human nature, the  
relationship between man and nature, good and bad, time and  
space.  
Edward T. Hall also focuses on communication features  
found in cultures based on four dimensions, namely, the  
context of communication, space management, the  
relationship to time and the structure of community flows. We  
can also note the study of Hofstede (1980-1991), which  
focuses on the collective characteristics of citizens of the  
country. This author considers culture as a kind of collective  
programming of the brain, consisting in distinguishing people  
from different nations. G. Hofstede’s model uses 5 key  
characteristics of national culture: the distance of power, the  
level of individualism (collectivism), the predominance of  
male or female principles, the desire to evade the uncertainty  
of the external environment, and the orientation toward long-  
term relationships.  
2
Research Methodology  
The methodological basis of the study was the methods of  
comparison, description, descriptive statistics, correlation and  
regression modeling, visualization method. Based on the  
methods of description and comparison, an analytical analysis  
of the assessment of the influence of national culture in  
economic systems from the point of view of the formation and  
development of key components of a cyclical economy is  
presented.  
Using the correlation and regression analysis, the  
influence of the parameters of the cyclical economy at the  
mesoscale on the growth of gross value added of the industrial  
sector is determined, which allows using the obtained model  
for forecasting trends in the industrial complex and  
mesoeconomics in general, which can be applied in the  
development of programs and projects for improving the  
competitiveness of mesoeconomic systems.  
The distance of power characterizes the degree to which  
less influential members of organizations and institutions (for  
example, families) accept and expect that power is distributed  
unevenly.  
The visualization method allowed us to give a graphical  
representation of the regression model, clearly demonstrating  
the influence of indicators of the cyclical economy on the  
formation of gross value added, which allows us to visualize  
this relationship.  
Individualism is the degree to which people feel  
independence, not interdependence, as members of larger  
whole. Individualism does not mean selfishness. This means  
that individual choices and decisions are expected.  
Collectivism does not mean intimacy. This means that a  
person “knows his place” in life, which is determined socially.  
With a metaphor from physics, people in an individualistic  
society are more like atoms flying in a gas, while in  
collectivist societies they are more like atoms fixed in a  
crystal.  
3
Results and Discussion  
We believe that the type of national culture that prevails in  
economic systems and influences the formation of a model of  
thinking is important in matters of the development of a  
cyclical economy. Moreover, in the context of the  
globalization of economic systems, intercultural interaction  
8
28  
Journal of Environmental Treatment Techniques  
2020, Volume 8, Issue 2, Pages: 872-833  
Masculinity is the degree to which the use of force is  
supported in society. In male society, men must be tough.  
Men must be from Mars, women from Venus. Victory is  
important for both sexes. The quantity is important, and the  
large is beautiful. In female society, gender is emotionally  
closer.  
abroad face a serious problem of cultural differences, which  
play a key role in international economic relations. Changes in  
the structure of the 20th century international industrial  
organization, which aroused research interest among  
economists, also led to a significant amount of work in  
business literature. Indeed, many factors that influence the  
restructuring of industry are related to business. Examples  
include assembly line innovation and implementation,  
scientific management, modularity, lean manufacturing, and  
on-time production. While terminology such as “task trading”,  
“vertical specialization”, and “production sharing” is used in  
economic literature, business literature focuses on “supply  
chains.” This is combined with conditions from political  
economists and development theorists, which include “value  
chains”, “global product chains” and “global production  
networks”. Of these, the supply chain provides the most  
relevant perspective for a practicing business. Networks of  
firms are considered from the point of view of the main  
company, and the supply chain ontology takes various  
dimensions to orient the company with its network  
environment (for example, direct extended supply chains,  
horizontal levels or degrees of separation, and vertical  
structures within each tier). For too long, many companies  
have shown tunneling in their approach to doing business in  
emerging markets such as China, India, Brazil, and Russia.  
The Chinese are very hardworking, but they admire the  
objective, effective way of doing business in the West.  
Chinese managers improved their managerial skills, and many  
traveled to western countries for short-term management  
training.  
The desire to avoid uncertainty is connected with the  
tolerance of society to uncertainty and uncertainty. Prevention  
of uncertainty has nothing to do with risk prevention or the  
following rules. This is due to anxiety and distrust in the face  
of the unknown and, conversely, to the desire to have constant  
habits and rituals and to know the truth. Long-term orientation  
deals with change. In a culture oriented to a long time, the  
basic idea of the world is that it is in motion, and preparation  
for the future is always necessary. In a culture focused on a  
short time, the world is essentially the way it was created, so  
the past provides a moral compass, and sticking to it is  
morally good. Let us present an assessment of supply chain  
management (SCM) in a cyclical economy in terms of the  
characteristics of the national culture that dominates economic  
systems (Table 1).  
It is worth noting that an increasing number of terms are  
used by individuals and organizations that appear to be more  
appropriate, comprehensive or advanced than DRM. Such  
terms include demand chain management (to distinguish it  
from the type of management in which “supply” begins and  
controls the chain of actions), as well as value chain or value  
chain management.  
Supply chains can be managed as a whole through a  
dominant member or, alternatively, through a system of  
partnerships that require well-developed cooperation and  
coordination. Therefore, the formulation of supply chain goals  
is not an easy task, since all partners must agree on the choice  
of indicators, the definition of indicators and target values.  
The existing performance indicators used by most companies  
have a number of problems that prevent them from effectively  
measuring the overall performance of the supply chain.  
Participants in the supply chain should begin by jointly  
identifying winners and executors of orders for the supply  
chain, as they provide the intended direction for control  
actions to improve supply chain performance.  
However, in China there is  
a young hardworking  
generation that is ready to educate and learn on its own. They  
are proud to work for foreign firms and adapt to new  
challenges. China is developing railway ties with European  
countries, it should be noted that trains go to other countries.  
Thus, any political instability can greatly affect  
transcontinental freight transport. In order to successfully  
manage international railways, a logistics service company  
has to deal with various railway operators, customs regimes  
and laws. Brazil has traditional supply chain management,  
which involves some fairly standard trade-offs.  
Despite globalization spanning the global economy,  
enterprises and individual entrepreneurs doing business  
Table 1: Distinctive characteristics of supply chain management in a traditional and cyclical economy  
Supply Chain Management in a Cyclical  
Economy  
Reduction of stocks of resources, semi-finished  
products and finished products is carried out  
jointly  
Parameter Characteristics  
Specifics of Inventory Management  
Creating a value chain  
Traditional Management  
Each participant in the supply chain  
independently reduces inventory  
The desire to reduce the costs of a local Cost optimization not for individual participants  
enterprise  
in the creation of value, but for the entire chain  
Contract Planning Horizon  
Information flow management and  
monitoring  
Short-term Contracts  
Concentration of efforts on current  
transactions  
Strategic Partnership  
Long-term planning  
Joint planning system  
Unity Management Philosophy  
The number of suppliers in the  
network  
Based on one-time transactions  
Missing  
Large in order to reduce the risk of  
supply disruption  
Long-term contractual relations  
Unified  
Minimum in order to strengthen coordination  
Mechanism of economic and ethical  
coordination required  
Joint distribution  
Distribution channel management  
Reward and risk sharing system  
Minimum or none  
Individual for each company  
Longer with a focus on the formation  
of stocks in case of instability in  
demand.  
A system of flexible response to demand,  
minimization of products in the chain  
The speed of operations  
8
29  
Journal of Environmental Treatment Techniques  
2020, Volume 8, Issue 2, Pages: 872-833  
Achieving savings in the provision of services, and direct  
sales. The true winners of the supply chain are those who can  
break these standard compromises with unconventional  
approaches. This is certainly the case, except that:  
the masculinity index, the value of which amounted to 66  
points out of 100. For comparison: in India - 56, in Brazil -  
49, in Russia - 36.  
Thus, summarizing, the following features of the Russian  
national culture should be pointed out: a high imperious  
distance in the governance structure and a desire to avoid  
uncertainty, which indicates a closed and traditional economic  
system, a weak susceptibility to dynamism, innovation, which,  
as a result, complicates the perception of the new managerial  
paradigms - a cyclical economy.  
1
) Brazil's geographic space and population as a whole  
mean that the distribution of goods is fragmented across many  
channels.  
2
) Taxes are high compared to logistics costs, and tax  
policies are complex and unstable. Companies often make  
taxes decisive when making key decisions in the supply chain.  
3
) Demand for many products is concentrated in the last  
Some researchers believe that we are entering a new era in  
socio-economic history. For management, this means that  
traditional, proven ways of doing business must change and  
new principles must be adopted. Openness, partnership,  
resource sharing and global operations are key principles in  
this new era. Similar principles also play an important role in  
supply chain management.  
1) National culture has a significant impact on the success  
of cooperation between companies in the supply chain.  
2) Companies integrated into international supply chains  
should: understand what foreign employers expect from them,  
feel free to discuss emerging cross-cultural problems with  
their superiors, and strive not only for inter-functional or inter-  
organizational, but also for inter-cultural coordination, that is,  
coordination between corporate and national culture.  
week of the month. This leads to chaos in warehouses and  
increases transportation costs.  
These difficulties in the aggregate create problems that are  
not similar to those encountered in any other market,  
developed or developing. A review and comparative analysis  
of possible approaches to assessing the development of  
informal institutions (Figure 2) used in the works of Russian  
scientists is carried out. The analysis indicates that in the  
process of supply chains in Russia they use a high score of  
power distance and the desire to avoid uncertainty, strict rules,  
regulations and / or laws for managing flows in comparison  
with other countries. Thus, the Russian economy has the  
highest value of the uncertainty avoidance index - 95 points  
out of 100. For comparison: the value of this indicator in  
Brazil was 76, India - 40, China - 30. One of the highest is the  
power distance indicator - 93 points out of 100. It should be  
noted that in all developing countries under consideration, this  
indicator was high: in China - 80, in India - 77, in Brazil - 69,  
which allows us to talk about the unification of common  
features in the interaction between higher and lower levels of  
government in a hierarchy ical structures. The individualism  
index for the considered national cultures was insignificant,  
the lowest value was noted in China - 20 points out of 100,  
then - in Brazil - 38, in Russia - 39, India - 48. A characteristic  
feature of Chinese national culture, in contrast to other  
economic systems under consideration, was the dominance of  
3) Countries where strong individualism and  
a
confrontational approach prevail may be in a less favorable  
position. In this case, the chances of success of a partnership  
in the supply chain can be increased by creating a national  
culture focused on cooperation and using tools that will help  
determine the goals of the partnership and its optimal “depth”.  
4) The company measures and controls labor costs and  
production results, stimulates the growth and improvement of  
production, and also improves the structure of reproduction  
and distribution of resources.  
Power distance  
The desire to avoid uncertainty  
Individualism index  
Masculinity  
95  
93  
80  
77  
76  
69  
66  
56  
49  
48  
40  
39  
38  
36  
30  
20  
China  
India  
Brazil  
Russia  
Figure 2: Supply chain assessments  
8
30  
Journal of Environmental Treatment Techniques  
2020, Volume 8, Issue 2, Pages: 872-833  
Issues of the development of a cyclical economy are  
receiving more and more attention in the management of  
mesoeconomic systems. One example of this management  
initiative is regional industrial complexes, presented as  
mesosystems. About 50% (48.2% in 2018) of the generated  
gross regional product accounted for industrial production,  
while this indicator increases annually [11].  
Let us analyze the main indicators of a cyclical economy  
using the example of a mesosystem. A positive trend is  
characterized by fixed capital investments aimed at protecting  
the environment and rational use of natural resources, which  
increased from 4058.5 million rubles in 2014 to 5820.9  
million rubles in 2018 (an increase of 43.4%) . Over a five-  
year period, water losses during transportation decreased from  
characterized by annual growth trends. The total number of  
pollutant emissions into the atmosphere increased from 617.5  
thousand tons in 2014 to 768.4 thousand tons in 2018 (an  
increase of 24.4%), while the increase was noted as due to  
emissions from mobile sources and stationary [13].  
In 2018, hydrocarbons (including volatile organic  
compounds) accounted for the largest share in the structure of  
pollutant emissions in gross atmospheric emissions in 2018 -  
56.1% (45.4% in 2014), Carbon monoxide - 17.2% (26 , 4%),  
nitrogen oxides - 12.1% (12.2%), sulfur dioxide - 8.7%  
(10.3%), solids - 4.6% (4.6%) (Figure 3) [13]. The  
analysis of the dynamics of the main indicators of industrial  
development in the cyclical economy showed that the growth  
rates of the main macroeconomic indicators - the gross value  
added of the industry, the balanced financial result,  
investments in fixed assets exceeded the growth of indicators  
of the cyclical economy - investments in fixed assets aimed at  
protecting the environment and rational use natural resources  
and current costs for environmental protection (average  
growth rate was 114.6%, respectively, 1 22% and 100.1%  
versus 109.4% and 99.4%). In addition, the ratio of  
environmental protection costs to the balanced financial result  
of industrial enterprises was characterized by a decrease, so if  
in 2014 the value of the indicator was 7.8%, then in 2018 it  
was 3.4%. The share of investments in fixed assets aimed at  
protecting the environment and rational use of natural  
resources in the total investment of industrial enterprises  
increased from 1.9% to 2.7% for the analyzed period [10, 11].  
To identify the dependence of industrial production  
development trends and indicators of a cyclical economy, we  
use the method of regression analysis. As a dependent  
variable, we propose to take the gross value added of the  
industrial sector, independent ones - investments in fixed  
assets aimed at protecting the environment and rational use of  
natural resources and current costs for protecting the  
environment.  
6
1.65 million m3 to 51.88 million m3 (decrease by 15.8%);  
water use - from 724.46 million m3 to 663.39 million m3  
decrease by 8.4%); discharge of polluted wastewater - from  
(
4
3
39.42 million m3 to 296.19 million m3 (a decrease of  
2.6%). Positive dynamics is also noted in the volume of  
reverse and sequential water supply, where the value of the  
indicator increased by 202% - from 4635.05 to 5569.33  
million m3. However, against the background of positive  
improvements in the introduction of a cyclical economy,  
negative trends were also observed associated with an increase  
in emissions of atmospheric pollutants from stationary sources  
by 34.1% in 2014-2018; freshwater withdrawal from natural  
water sources and reforestation for the indicated period  
practically did not change. At the same time, the capture and  
neutralization of air polluting substances emanating from  
stationary sources decreased by 8.2%. The share of energy  
resources produced using renewable energy sources in the  
total volume of energy resources decreased from 8.7% in 2014  
to 6.8% in 2018 (Table 2) [13]. Thus, despite the introduction  
of the fundamentals of a cyclical economy, there are negative  
trends and inconsistent trends in its formation and  
development on the meso-control of the management of the  
economic system, which complicates the transition to a  
sustainable economy. One of the negative factors holding  
back the development of a cyclical economy is the excessive  
environmental impact of the industrial complex, which is  
Table 2: The main indicators of the cyclical economy of the mesosystem (for example, a regional industrial complex)  
Environmental protection in the Republic of Tatarstan, 2019 [13])  
(
Indicator  
2014  
058,5  
2015  
2016  
2017  
2018  
Investments in fixed assets aimed at protecting the environment and  
rational use of natural resources, million rubles  
Current expenses for environmental protection, million rubles  
Emissions of air polluting substances from stationary sources,  
thousand tons  
4
6574,6  
4566,6  
5225,6  
5820,9  
12973,5 9961,8  
10861,3 11755,3 12676,4  
2
93,6  
293,6  
338,3  
285,9  
393,6  
Capture and neutralization of air polluting substances emanating  
from stationary sources, thousand tons  
4
26,6  
437,3  
495,1  
463,2  
391,6  
3
Freshwater withdrawal from natural water sources, mln. m  
Water losses during transportation, mln m  
786,66  
61,65  
775,12  
53,65  
792,32  
48,92  
784,30  
47,96  
768,38  
51,88  
3
Water use, mln. m3  
724,46  
720,40  
744,19  
692,28  
663,39  
Volume of reverse and sequential water supply, mln. m3  
Contaminated wastewater discharge, mln. m  
Reforestation, ha  
4635,05 4794,36 5251,51 5347,77 5569,33  
3
439,42  
2580  
382,48  
2128  
325,21  
1923  
319,71  
2839  
296,19  
2406  
The share of energy resources produced using renewable energy  
sources in the total volume of energy resources,%  
8
,7  
10,3  
7,8  
9,5  
6,8  
8
31