Energy expenditures and CPI inflation in 2022: Inflation was even higher than we thought

Aftab Chowdhury and Huw Dixon

Energy Economics, 2025, vol. 145, issue C

Abstract: Following the sudden increase in the energy price in the second quarter of 2022 caused by the Russia-Ukraine war, inelastic demand generated significant changes in household expenditure shares for energy (particularly in electricity, gas, and other fuels and in fuels and lubricants). These produced a significant downward bias in the official CPI inflation rate for energy and in the official CPI inflation rate for all items in the UK. The downward bias was significantly higher in the European Union in 2022, specifically in Belgium, Estonia, Ireland, Greece, Italy, Cyprus, Lithuania, the Netherlands, Romania, and Slovenia.

Keywords: Energy price; Inflation measurement; Household final consumption expenditure (HHFCE); Consumer Price index (CPI) (search for similar items in EconPapers)
JEL-codes: C67 D10 E01 E31 Q41 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:145:y:2025:i:c:s0140988325003068

DOI: 10.1016/j.eneco.2025.108482

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