The profit-price spiral: How to prevent the cost of living crises

This seminar discussed the causes and possible responses to recent inflation, based on the policy study on “The profit-price spiral in food and energy.”

The focus was on how inflation has been fuelled by profit dynamics in the food and energy sectors and how progressive policies can provide more effective responses than orthodox approaches focused solely on monetary policy. The goal was to broaden the scope of the public sector’s action to combat rising living costs. 

Key themes 

• The limits of the monetary response to supply-side inflation. 
• How market power and speculation have inflated prices, particularly in the food and energy sectors. 
• Toolbox of measures to prevent and contain inflation: market regulation, price controls, subsidies, energy market design. How effectively they were used in 2022-24 and recommendations for the future. 
• The implications for Italy and the center-left’s policy proposals. 

For more information, please do not hesitate to contact Luis Sáez Jiménez, FEPS Project Officer (luis.saez@feps-europe.eu).