The Influence of Circular Economy Initiatives on the EU Environmental Goods and Services Sector

The research presented in this article aimed to analyze the impact of circular economy initiatives on the European Union environmental goods and services sector. Data from the Eurostat databases were used to conduct the research. Validation of the five research hypotheses involved the formulation of two regression equations: the first one focused on innovation and recycling performance indicators, and the second equation focused on circular-economy indicators. Both models were estimated using country fixed-effects regression with Driscoll–Kraay standard errors to ensure robust inference. The regression model was selected based on the Hausman test and F-test, but tests for autocorrelation, heteroscedasticity, and multicollinearity were also performed. The main findings, as the results suggest, refer to the central role of private investment in circular sectors and resource productivity, both exerting positive and significant effects on the environmental goods and services sector (EGSS). The material footprint also shows a positive effect, but in contrast, the circular material use rate does not display a significant impact, indicating that increases in the share of recycled materials do not automatically translate into greater economic value.