Global production networks and circular economy territorialization: How global-local linkages affect local institutions’ ability to support circularity

This article examines how different configurations of regional integration into global production networks (GPNs) shape the capacity of local and regional institutions to support circular economy (CE) initiatives. We present a theoretical framework that connects GPN theory with regional processes and CE territorialization. This framework focuses on how key GPN characteristics—cost–capability ratios, governance structures, and product materialities—condition the ability of institutions to foster regional circular transitions through processes of strategic decoupling and territorial circular recoupling in specific industries. Empirically, we draw on a comparative case study of the construction and textile industries in South-West France. Our findings show that in the construction sector, the regionally embedded structure of production networks facilitated circular territorial recoupling: local institutions leveraged geographical and organizational proximity to coordinate actors and overcome logistical constraints. In contrast, the textile sector’s highly globalized configuration strongly constrained local institutions’ enabling capacities. Fragmented material flows, global sourcing, and unfavourable local cost structures created significant barriers to territorializing circularity in the absence of broader regulatory support. These results highlight that circular transitions depend not only on local initiatives, but also on the spatial and organizational configuration of GPNs. In regionally embedded production networks like construction, local institutions can play a strong enabling role in promoting strategic decoupling and circular territorial recoupling. In globalized networks like textiles, advancing CE requires stronger multi-level regulatory frameworks and coordination to rebalance cost–capability structures and support new circular pathways.