Strategic Dynamics of Circular Economy Initiatives in Food Systems: A Game Theory Perspective

Abstract

This paper analyses how strategic interactions between actors influence the development of circular economy (CE) initiatives in food systems. Using a case study from Saint-Hyacinthe, a mid-sized and agri-food technopole in Québec (Canada), we investigate how cooperation, competition, and power asymmetries shape CE adoption across the supply chain. Drawing on game theory and a typology of management dynamics, the study identifies four patterns: negotiated management, constrained leadership, hierarchical relationships, and competitive behaviour. Empirical data were collected through two collaborative workshops involving public, private, and community-based actors, resulting in 244 coded entries across 12 boards. These allowed us to assess actors’ interests, attitudes, and capacities in relation to CE strategies at upstream, midstream, and downstream stages. The results show that strategies aligned with dominant interests and existing capacities are more likely to be supported, while those requiring structural change are tolerated or marginalized. Findings highlight the role of incentive mechanisms, institutional flexibility, and coordination in enabling more transformative circular initiatives. By adopting a stage-sensitive perspective, this study also fills a gap in the literature by examining how actor dynamics differ across upstream, midstream, and downstream segments of the food system, contributing to CE research by applying game theory to actor configurations and interaction dynamics in food systems. It calls for further exploration of interdependencies and contextual conditions that either facilitate or hinder the emergence of effective, inclusive, and systemic CE transitions.