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Supply Chain Price Transmission and the Role of Fundamental Factors: Evidence from Bulgaria in the Run-Up to Euro Area Accession

Author

Listed:
  • Daniela Bobeva-Filipova
  • Emil Panusheff
  • Spartak Keremidchiev
  • Nedyalko Nestorov
  • Atanas V. Pavlov

Abstract

The aim of this paper is to examine the price dynamics in the Bulgarian economy in the run-up to Euro Area accession within the framework of the supply chain, starting from the main production factors' prices, passing through producer and consumer prices, with a particular focus on the extent to which producer and consumer price dynamics can be explained by changes in the fundamental pricing factors. The analysis is based on a comprehensive author's data set of indicators for the prices of key production factors and a specifically designed Production Factor Price Index. The results show that in 2025 and early 2026, consumer price dynamics cannot, to any significant extent, be explained by the fundamental pricing factors of production. The final consumer prices are primarily formed by the interaction of domestic demand, market structure and consumer behaviour, while the role of traditional pricing factors is limited and strongly differentiated across the different sectors.

Suggested Citation

  • Daniela Bobeva-Filipova & Emil Panusheff & Spartak Keremidchiev & Nedyalko Nestorov & Atanas V. Pavlov, 2026. "Supply Chain Price Transmission and the Role of Fundamental Factors: Evidence from Bulgaria in the Run-Up to Euro Area Accession," Economic Studies journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 6, pages 31-49.
    • Handle: RePEc:bas:econst:y:2026:i:6:p:31-49
    as

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    File URL: http://archive.econ-studies.iki.bas.bg/2026/2026_06/2026_06_02.pdf
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    References listed on IDEAS

    as
    1. Kuik, Friderike & Lis, Eliza & Paredes, Joan & Rubene, Ieva, 2024. "What were the drivers of euro area food price inflation over the last two years?," Economic Bulletin Boxes, European Central Bank, vol. 2.
    2. Moya Chin & Ms. Li Lin, 2023. "The Pass-through of Wages to Consumer Prices in the COVID-19 Pandemic: Evidence from Sectoral Data in the U.S," IMF Working Papers 2023/233, International Monetary Fund.
    3. Daniela Bobeva-Filipova & Emil Panusheff & Nedialko Nestorov & Atanas Pavlov, 2025. "US Tariff Changes and Bulgaria's Presence in Global Value Chains," Economic Thought journal, Bulgarian Academy of Sciences - Economic Research Institute, issue 4, pages 411-426.
    4. Sophia Chen & Ms. Deniz O Igan & Do Lee & Ms. Prachi Mishra, 2024. "Inflation and Labor Markets: A Bottom-Up View," IMF Working Papers 2024/220, International Monetary Fund.
    5. Rubene, Ieva, 2023. "Indicators for producer price pressures in consumer goods inflation," Economic Bulletin Boxes, European Central Bank, vol. 3.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    JEL classification:

    • E31 - Macroeconomics and Monetary Economics - - Prices, Business Fluctuations, and Cycles - - - Price Level; Inflation; Deflation
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development

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