Whom does inflation hurt most?
Western economies are experiencing a rapid increase in inflation rates fuelled by energy prices and the war in Ukraine. Yet, the impact of the price increase is not equally distributed.
In 8 out of 17 countries, lower-income groups whose consumption basket is mainly composed of essential goods are most affected by the increase in prices.
Poorest households suffered a rise in prices 2 to 5 percentage points higher than the wealthiest households.
Target compensatory policies financed through higher revenues from energy taxes could be an effective way to mitigate the regressive effect of inflation.
VILLANI Davide;
VIDAL LORDA Guillem;
2022-06-13
European Commission
JRC129558
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