The impact of the recent rise in inflation on low-income households

Evangelos Charalambakis, Bruno Fagandini, Lukas Henkel and Chiara Osbat

Economic Bulletin Boxes, 2022, vol. 7

Abstract: This box examines the impact of the recent rise in inflation on low-income households in the euro area. Low-income households face significantly higher effective inflation rates than high-income households, due to a different composition of their consumption basket. Moreover, they are more liquidity-constrained and have less room to buffer sharp increases in their cost of living. Survey-based evidence shows that low-income households perceive the recent government measures aimed at easing the burden of higher energy prices as less adequate than high-income households do. This could suggest that there is potential for government support measures to be more targeted towards low-income households. JEL Classification: E31, E21

Keywords: inequality; Inflation (search for similar items in EconPapers)
Date: 2022-11
Note: 261931
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Citations: View citations in EconPapers (12)

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