Abstract: The rise in plastic packaging production and disposal has encouraged the progress of recycling technologies and aroused policy discussion on how to increase recycling rates. However, the effect that these policy instruments will have on the development of the different recycling technologies has not been studied holistically yet. This dissertation explores how new and existing technologies will behave under the market and policy conditions observed at present and after the implementation of the policy instruments that are under discussion. The technologies that are analyzed in this thesis are mechanical recycling and thermochemical recycling of post-consumer polyolefin waste. Using a techno-economic assessment that takes into account the physical properties of the different plastic fractions and their contamination level, the study shows that both mechanical and thermochemical recycling can be profitable if oil prices remain steady or increase. Specifically, mechanical recycling will show better results than thermochemical recycling for plastic fractions with low contamination levels. On the contrary, thermochemical recycling is more profitable for fractions with a higher contamination level from which high-quality products cannot be obtained with mechanical recycling, such as PE films. Moreover, it demonstrates that besides the oil prices and sorted waste prices, waste purity and the plant capacity are the variables that influence more the net present value of thermochemical recycling and the labor cost and waste purity the ones of mechanical recycling. The thesis explores the dynamics between the stakeholders of the circular value chain and predicts the recycling rates under the implementation of several policy instruments. This is done with a supply chain equilibrium model, based on the extended producer responsibility scheme implemented in Flanders, that uses as an input the cost structures of mechanical and thermochemical recycling obtained from the techno-economic assessments. Direct interventions like recycled content standards, can decouple the recycling industry from the oil market, but in the long term, they may not present incentives to achieve recycling levels beyond the targeted amounts and thus limit technological innovation. On the contrary, economic interventions such as taxes, create economic incentives for recycling and allow fund collection from the government but leave the recycled levels dependent on external markets. Results also show that higher recycling rates does not necessarily mean better environmental performance. Therefore, when designing circular economy policies, policymakers should carefully analyze whether the intention is to increase circularity or improve the sustainability of the value chains.