Addressing Socioeconomic Inequalities towards a Circular and Sharing Economy: An Exploratory Study in Chicago

While socioeconomic inequalities have been well recognized as a major challenge of sustainability and resiliency, most formal research has focused on income inequalities. Inadequate attention has been paid to the spending... [ view full abstract ]

While socioeconomic inequalities have been well recognized as a major challenge of sustainability and resiliency, most formal research has focused on income inequalities. Inadequate attention has been paid to the spending side. Decreases in spending on the same level of services and goods contribute to increases in real value of income. In other words, a higher income level combined with higher living costs may not lead to improved quality of life, which, unfortunately, has been the case in the U.S. Since the 1970s, the real hourly compensation has been stagnant despite continued growth in economic productivity (Dresser, 2016). Meanwhile, the U.S. has experienced faster growth in inequality than other advanced economies (Bernstein, 2013). Researchers attribute the alarming inequality status to a combination of the quality of life and the formal job, which includes health and social benefits as a package (Dresser, 2016). Economic strategists like Claudia Juech (2015) at the Rockefeller Foundation advocates for “decoupling formal employment from pension, health, and welfare schemes” and “combining various types of formal and informal work” (The Rockefeller Foundation, n.d.). System-wide innovations in job creation and material management are needed.

This presentation discusses a regional system-thinking approach that involves the flows of goods, services, materials, people, finance, and information through an urban system when addressing socioeconomic inequalities. Specifically, we propose to focus on a “circular” and “sharing” system model (CSSM) that maintains the utility of all materials through either re-circulating discarded materials or sharing underutilized resources in an economic system. An exploratory study is undertaken in a case study in Chicago based on a Strengths, Weaknesses, Opportunities, and Threats (SWOT) analysis, both quantitatively and qualitatively. Further, we develop applicable metrics that can measure (1) the extent of inequalities in both outcome and opportunities that capture economic, social, and environmental aspects; and (2) the progress of socioeconomic inequalities. In a scenario analysis, we compare the baseline of socioeconomic inequalities in Chicago to projected scenarios, e.g., if the environmental and socioeconomic inequalities in Chicago will decrease if a CSSM is adopted as in leading cities. We conclude by suggesting policy levers in support of system innovation and citizen behavior changes through the CSSM implementation.