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Who Suffers the Most from the Cost-of-Living Crisis ?

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  • Lokshin,Michael M.
  • Sajaia,Zurab
  • Torre,Ivan

Abstract

This paper constructs cost-of-living indexes for different groups of households to quantify thedifferences in the distribution of the burden of high inflation among the populations of countries in Europe andCentral Asia. The analysis demonstrates that the cost-of-living crisis of 2022–23 has had a heterogeneousimpact on European populations. Poor households appear to suffer the most from rising food and energy prices. Povertyand inequality rates and the profiles of the poor based on household-specific inflation rates systematically differfrom those based on the standard consumer price index approach. Accounting for the variability of inflation ratesacross household types might help policy makers design policies that better protect vulnerable households andpromote economic growth.

Suggested Citation

  • Lokshin,Michael M. & Sajaia,Zurab & Torre,Ivan, 2023. "Who Suffers the Most from the Cost-of-Living Crisis ?," Policy Research Working Paper Series 10377, The World Bank.
    • Handle: RePEc:wbk:wbrwps:10377
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