Energy prices and the structure of inflation in European Union countries

Markowski Łukasz () and Kotliński Kamil
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Markowski Łukasz: Faculty of Economic Sciences, University of Warmia and Mazury in Olsztyn, Olsztyn, Poland
Kotliński Kamil: Faculty of Economic Sciences, University of Warmia and Mazury in Olsztyn, Olsztyn, Poland

International Journal of Management and Economics, 2025, vol. 61, issue 1, 17-28

Abstract: Since 2022, in almost every inflation category, a strong divergence in price dynamics among the EU countries has become visible. The first aim of this paper is to assess the impact of changes in energy prices on the differentiation in price dynamics in individual inflation categories in EU countries. The second aim is to isolate those components of inflation that have significantly differentiated the countries in the crisis year of 2022. The research was conducted based on the vector-autoregressive model, the Granger causality test, cluster analysis and analysis of variance. It can be concluded that there is a causal relationship between energy prices and the differentiation in the price growth rate in certain inflation categories. In 2022, the EU member states were divided into two quite distinct clusters. This article adds value to current research by taking into account the level of variation in the inflation structure among EU countries.

Keywords: energy prices; energy shocks; European Union; inflation structure (search for similar items in EconPapers)
JEL-codes: E31 Q41 Q43 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:vrs:ijomae:v:61:y:2025:i:1:p:17-28:n:1005

DOI: 10.2478/ijme-2024-0026

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