Comparing the impacts of economic uncertainty, climate change, Covid-19, and the Russia-Ukraine conflict: Which is the most dangerous for EU27 food prices?

Abstract

Comparing the impacts of economic uncertainty, climate change, Covid-19, and the Russia-Ukraine conflict: Which is the most dangerous for EU27 food prices?This study compares the impact of economic uncertainty, climate change, Covid-19, and the Russia-Ukraine conflict on 27 European countries (EU27) food prices. The author used panel data that combines cross section data from January 2019 -March 2023 and time series data from 27 European countries. The error correction model (ECM) and Autoregressive Distributed Lag (ARDL) were used to analyse the data. The domestic energy consumer price index, real broad exchange rate, climate change, and Russia-Ukraine armed clashes are the drivers of the short and long run rise in the EU27 domestic food consumer price index. New domestic cases of Covid-19 can increase the EU27 domestic food consumer price index in the short run but not in the long run. Meanwhile, an increase in the unemployment rate has the potential to lower the EU27 domestic food consumer price index in both the short and long run. Among all the global shocks examined in this study, changes in the real broad exchange rate have the greatest impact on the EU27 domestic food consumer price index.