Positive and negative shocks of financial markets on sustainable finance in europe: Evidence from vector auto regression and granger causality

IF 4.8 2区经济学 Q1 BUSINESS, FINANCE

International Review of Economics & Finance Pub Date : 2025-03-18 DOI:10.1016/j.iref.2025.104042

Ali Raza , Faizah Alsulami

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Abstract

This study analyzes the interdependencies between sustainable finance and various financial markets in Europe. The data has been sourced from the European financial markets covering the period from 2022 to 2024 b y using the Vector Auto-Regression (VAR) model. The study indicates that stocks, bonds, currencies and future markets and sustainable finance has positive shocks (P < 0.05), while exhibiting negative shocks of crypto and commodity markets and sustainable finance (p < 0.05). VAR Granger causality also supports these findings and shows a relationship among these variables. This study comprehending the findings that promote sustainability within the European financial system. It aims to guide policymakers, investors in society, and other market participants in enhancing the connection between sustainability and financial stability. This study provides systematic insights into the significance of sustainable finance and its relationship with various factors that constitute the overall market environment.

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来源期刊

International Review of Economics & Finance Multiple-

CiteScore

7.30

自引率

2.20%

发文量

253

期刊介绍： The International Review of Economics & Finance (IREF) is a scholarly journal devoted to the publication of high quality theoretical and empirical articles in all areas of international economics, macroeconomics and financial economics. Contributions that facilitate the communications between the real and the financial sectors of the economy are of particular interest.