@article {10.34196/ijm.00315,
article_type = {journal},
title = {Are Energy Bills Squeezing People’s Spending?},
author = {Colabella, Andrea and Lavecchia, Luciano and Michelangeli, Valentina and Pico, Raffaella},
volume = 18,
number = 3,
year = 2025,
month = {feb},
pub_date = {2025-02-14},
pages = {1-25},
citation = {IJM 2025;18(3):1-25},
doi = {10.34196/ijm.00315},
url = {https://doi.org/10.34196/ijm.00315},
abstract = {This paper presents an assessment of the energy price shocks that affected Italian households starting in mid-2021 and their impact on households’ financial vulnerability. First, we estimate the price elasticity of electricity and heating demand. Then, within the framework presented in Faiella and Lavecchia (2021b), we compute the variation between 2020 and 2022. Second, we study how those variations affected households’ financial vulnerability, based on an extension of the modeling strategy proposed by Faiella et al. (2022). Our results indicate that if energy price elasticity is not duly accounted for, financial vulnerability rises excessively following an energy price upsurge. However, when consumption rebalancing is taken into account, financial vulnerability remains rather low and in line with the supervisory data. While the risks for financial stability associated with energy shocks are therefore limited, this occurs at the expense of household consumption and welfare.},
journal = {IJM},
issn = {1747-5864},
publisher = {International Journal of Microsimulation},
}