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Energy price increases and mitigation policies: Redistributive effects on Italian households

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  • Bonfatti, Andrea
  • Giarda, Elena

Abstract

Between July 2021 and March 2023, the Italian government took action to support households’ and individuals’ incomes to help them cope with the exceptional energy and food prices surge, by means of both tariff and income-based fiscal policy measures. In this paper, we perform a microsimulation exercise to quantify the effects of the price increases and of the policy interventions on household expenditure and income. Our results indicate that the regressive impact of the price rises was mitigated by the fiscal measures, which also succeeded in reducing inequality, at risk of poverty and energy poverty. Furthermore, we observe the relevant role of income-based measures in the South of the country.

Suggested Citation

  • Bonfatti, Andrea & Giarda, Elena, 2025. "Energy price increases and mitigation policies: Redistributive effects on Italian households," Journal of Policy Modeling, Elsevier, vol. 47(2), pages 251-275.
    • Handle: RePEc:eee:jpolmo:v:47:y:2025:i:2:p:251-275
    DOI: 10.1016/j.jpolmod.2024.06.006
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    Keywords

    Microsimulation; Redistribution; Energy prices mitigation policies; Energy consumption; Energy poverty;
    All these keywords.

    JEL classification:

    • D10 - Microeconomics - - Household Behavior - - - General
    • D30 - Microeconomics - - Distribution - - - General
    • H31 - Public Economics - - Fiscal Policies and Behavior of Economic Agents - - - Household
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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