The Energy Crisis as a Factor of Aggravating Poverty in Bulgaria and Romania. State's Social Expenditures Evolution

Ioan-Cătălin Murăraşu
Răzvan Bujor
JEL codes: 
O13 - Agriculture; Natural Resources; Energy; Environment; Other Primary Products, Q43 - Energy and the Macroeconomy.
The chain effects of the energy crisis that European society is currently facing will intensify with the start of the cold season, especially given the unpredictability of Russian gas supplies. In the context where almost half of the Romanian residents and a third of the Bulgarian residents declare that they cannot cope with unforeseen expenses, the doubling of energy prices compared to the previous year will affect people with low and medium incomes. Using the EViews 12 program to correlate the evolution of natural gas and electricity prices with the housing costs borne by people with low incomes in the two states (Pearson correlation coefficient), as well as with the social expenses of Romania and Bulgaria, we notice that the number of vulnerable people can increases significantly with the increase in heating and electricity expenses, in the absence of consistent social measures from the authorities. The objective of the research is to demonstrate that the energy crisis in Europe is a factor that can increase the risk of poverty in less developed states if the state will not allocate sufficient funds to support vulnerable people or to partially compensate their bills. This fact can cause many risks, such as poverty or labor emigration.
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