Circularity and Price Dynamics: A Systematic Review and Computational Analysis of Economic Mechanisms

Circularity is increasingly linked to inflation, price shocks, and economic resilience, but the underlying relationships remain fragmented across disciplines and levels of analysis. This review combines systematic screening, bibliometric mapping, structural topic modelling, and mechanism-based synthesis. Web of Science and Scopus searches yielded a 392-document analytical corpus, of which 72 studies met the substantive eligibility criteria for synthesis. Six mechanisms connect circularity and prices: material substitution and exposure, differential shock transmission, cost substitution and avoided costs, endogenous circular supply, circular-capacity vulnerability, and behavioural feedback. The evidence indicates a bidirectional and conditional system: circularity can alter price exposure, while prices and macroeconomic conditions also shape circular supply, investment, and behaviour. Secondary markets remain connected to virgin-resource markets, and direct aggregate evidence linking circularity to inflation is sparse. Price resilience therefore depends on substitution, transmission, cost structures, market development, and the viability of circular capacity rather than following automatically from greater circularity.