Investigating the Impact of Circular Economy on Stock Market Performance: European Union Countries

Document Type : Original Article

Authors

1 Faculty of Management Sciences, October University for Modern Sciences and Arts (MSA), Egypt

2 Faculty of Management Sciences October University for Modern Sciences and Arts (MSA), Egypt

10.21608/msamsj.2025.406841.1123

Abstract

Nowadays, circular economy (CE) has a substantial impact on stock market performance (SMP) especially in European Union (EU) countries that promote sustainable practices and encourage large companies to implement those practices in their business operations, this research investigates the impact of CE on SMP through examining the mediating role of the sustainable development goals (SDG) in the EU countries over the period 2000-2021. The variables used to measure CE are, annual freshwater withdrawal (AFWW), generation of municipal waste per capita (GMW), resource productivity (RP), recycling rate (RR), and recovery rate of recycling (RRR), further the SMP is measured by stock market indices return using panel least square regression analysis. Findings revealed that CE practices have a positive significant impact on SMP. However, the SDGs have insignificant mediation among CE practices and SMP. Accordingly, it’s highly recommended that other researchers study this nexus in the context of emerging countries especially in Egypt, as in our research we focused on EU countries because EU countries are considered highly innovative and apply CE practices comprehensively.

Keywords

MSA-Management Sciences Journal
Volume 4, Issue 3
August 2025
Pages 167-191

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