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Social Costs of Energy Disruptions

Author

Listed:
  • Valeria Costantini

    (ENEA and Fondazione Eni Enrico Mattei)

  • Francesco Gracceva

    (ENEA and Fondazione Eni Enrico Mattei)

Abstract

The costs of energy supply disruptions for industrialised economies go well beyond the economic measures of national accounts. According to different kinds of risks, physical shortages or price shocks, there are several categories of negative effects. Oil disruptions have both a direct and an indirect impact, (at global and local levels) and have a short- and a medium-term horizon. The economic effects of electricity shortages are also direct and indirect, but the temporal lag is shorter than for oil disruptions. In this paper, we summarise the different ways an economy is affected by an oil shock or a power black-out. Oil crises in the past produced high inflation rates, trade and payments imbalances, high unemployment, and weak business and consumer confidence. The social costs of electricity shortages have immediate negative results, and relatively small, indirect effects – depending on the extension of the disruption, the duration, the availability of advance warning and information. A specific assessment of the social costs of an electricity shortage remains a research task for the future.

Suggested Citation

  • Valeria Costantini & Francesco Gracceva, 2004. "Social Costs of Energy Disruptions," Working Papers 2004.116, Fondazione Eni Enrico Mattei.
    • Handle: RePEc:fem:femwpa:2004.116
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    References listed on IDEAS

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    Cited by:

    1. Nag, Suryadeepto, 2024. "Does reliable electricity mean lesser agricultural labor wages? Evidence from Indian villages," Energy Policy, Elsevier, vol. 190(C).
    2. Weisser, Hellmuth, 2007. "The security of gas supply--a critical issue for Europe?," Energy Policy, Elsevier, vol. 35(1), pages 1-5, January.
    3. Gasser, Patrick, 2020. "A review on energy security indices to compare country performances," Energy Policy, Elsevier, vol. 139(C).
    4. Suryadeepto Nag, 2023. "Does Reliable Electricity Mean Lesser Agricultural Labor Wages? Evidence from Indian Villages," Papers 2309.09178, arXiv.org.
    5. Christian Egenhofer & Kyriakos Gialoglou & Giacomo Luciani & Maroeska Boots & Martin Scheepers & Valeria Costantini & Francesco Gracceva & Anil Markandya & Giorgio Vicini, 2004. "Market-based Options for Security of Energy Supply," Working Papers 2004.117, Fondazione Eni Enrico Mattei.

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    More about this item

    Keywords

    Social costs; Energy disruption;

    JEL classification:

    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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