Europe’s Inflation Was More Painful for the Elderly
The euro zone’s recent bout of high prices reflects the ongoing inability of EU nations to balance the interests of young and old.
Even chocolate prices are looking better.
Photographer: Simon Wohlfahrt/Bloomberg
The unexpected decline of the rate of inflation in the euro zone, to 2.4% from 10.6% a year ago, will limit the strain on European economies and lower the risk that some European voters will opt for demagogic leaders. But it’s not all good news. Despite the decrease, this inflation episode reflects the ongoing inability of EU nations to balance the interests of young and old.
As recent research indicates, the recent inflation has been very costly. The 2021-2022 inflation cost more than 3% of national income in France, Germany and Spain, and about 8% of national income in Italy, higher costs than what a typical recession would bring.1