Inflation Differentials Based on Heterogenous Consumption Baskets of Slovak Households

Peter Tóth (), Samuel Holinga () and Richard Kali? ()
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Peter Tóth: Faculty of Economics and Business, University of Economics in Bratislava
Samuel Holinga: Faculty of Economics and Business, University of Economics in Bratislava
Richard Kali?: Faculty of Economics and Business, University of Economics in Bratislava

No 14516466, Proceedings of Economics and Finance Conferences from International Institute of Social and Economic Sciences

Abstract: This paper examines the empirical distribution of individual inflation rates derived from household-specific consumption baskets and investigates the relationship between these rates and the socio-economic characteristics of Slovak households. Utilizing household budget survey data and a detailed breakdown of HICP inflation indices from the peak of the recent inflationary shock in January 2022, we calculated household-specific consumption basket weights and individual inflation rates. Due to diverse consumption patterns within the sample, our findings indicate that multi-person households with children and retired households experience the highest levels of inflation. In contrast, wealthier households are significantly less exposed to inflation, owing to a smaller portion of their budget allocated to food and energy. The empirical distribution revealed a range of individual inflation rates, with variations of up to 7.8 percentage points below and 7 percentage points above the official HICP inflation rate. These findings are relevant for designing targeted social policies aimed at reducing poverty and income inequality.

Keywords: Inflation; Household expenditures; Consumption baskets; Slovakia (search for similar items in EconPapers)
JEL-codes: D12 E31 R20 (search for similar items in EconPapers)
Pages: 9 pages
Date: 2024-10
New Economics Papers: this item is included in nep-mon and nep-tra
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Published in Proceedings of the Proceedings of the International Conference on Economics, Finance & Business, Prague, Oct 2024, pages 157-165

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