Economic Aspects of Protecting Trade Secrets in the Circular Economy
DOI:
https://doi.org/10.37886/ip.2026.002Keywords:
circular economy , trade secrets, economic aspects, knowledge sharing, confidential information, risk management, institutional mechanismsAbstract
Research Question (RQ): This article discusses aspects of trade secret protection from a circular economy perspective. It focuses on three research questions: (1) how firms manage the tensions between information sharing and the protection of key knowledge, (2) what are the key economic factors and methods by which firms assess the benefits and risks of knowledge disclosure, and (3) what strategies firms use to economically manage the risks associated with trade secret protection.
Purpose: The aim is to explore the economic dimensions of trade secret protection in a circular economy. The focus is on the tensions between collaboration and knowledge protection, the economic factors that guide disclosure decisions, and risk management strategies.
Method: A systematic literature review was conducted using the PRISMA guidelines in the Web of Science and Scopus databases. The analysis included peer-reviewed articles published in the years 2016-2025, in English, in the fields of environmental science, sustainability, business sciences and economics. After a multi-stage selection process, 35 articles were included in the final analysis.
Results: The analysis shows that tensions between knowledge protection and sharing are widespread and are reflected in dilemmas between short-term competitiveness and long-term sustainability. Economic factors and valuation methods are diverse. Companies use traditional financial indicators to assess decisions: return on investment and economic value added. In practice, they are complemented by sustainability valuation approaches, e.g. life cycle analysis, environmental accounting and measuring consumers' willingness to pay. Risk management strategies are based on a combination of formal mechanisms, dominated by contracts and licenses, informal approaches involving trust and ethical commitments, and technological solutions, such as digital traceability and blockchain. The effectiveness of these strategies is closely linked to institutional incentives that reduce risks and encourage cooperation.
Organization: The findings offer guidance to business leaders for a balanced management of knowledge protection in circular business models. The research highlights the importance of systematically evaluating the economic benefits and risks of information disclosure and establishing appropriate mechanisms to reduce the uncertainty of collaboration.
Society: It is important to emphasize institutional mechanisms to support secure knowledge exchange, which has broader implications for sustainable development, as it enables more efficient use of resources, reduced environmental impacts, and greater corporate responsibility towards society and the environment.
Originality: Businesses often direct economic decisions towards maximizing private benefits, which limits the potential for the transformative effects of circularity. Sustainable transformation requires institutional mechanisms that reduce the costs of cooperation and increase the security of knowledge exchange.
Limitations / further research: The research is limited to peer-reviewed articles in English published between 2016 and 2025 and indexed in two databases, and the analysis is based on secondary sources. Further research could include in-depth case studies, cross-country comparative analyses, and empirical testing of the impact of institutional mechanisms on firms' willingness to share and protect knowledge in circular business models.
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