Evaluating impact on prices consumers pay
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Contents
Scope
Does the option affect the prices consumers pay?
Definition
Policy can influence the prices consumers pay for instance by monetary policy, which affects inflation, or by regulating duties and subsidies and by setting the prices of public goods.
Monetary policy is one of the tools used by public authorities to influence the economy. By using monetary authority to control the supply and availability of money, governments endeavour to line up the overall level of economic activity with political objectives, usually those of macroeconomic stability, i.e. economic growth, low unemployment, low inflation, and a balance of external payments.
Excise duties are a public authority intervention having a direct and deliberate effect on consumer prices. Excises are in fact indirect duties levied on specific goods, and have the purpose either to raise revenue or to discourage the consumption of that good or both. Taxes on fuel, alcohol and tobacco are typical examples, and they are often justified both on the ground of raising revenue and on the ground of protecting health and environment.
Agricultural policy is also affecting the prices of certain agricultural products by guaranteeing a minimum price to be paid to producers, under which the product is put in for storage or withdrawn from the market. [1]
Result
Further information
EC related information:
European Commission: Consumer policy
Activities of the European Union: Economic and Monetary Affairs[1]
Other information:
Indicators:
The following Eurostat Structural Indicators (General Economic Background) are relevant to address the key question:
The following Eurostat Sustainable Development Indicators (Economic development) are relevant to address the key question:
-Household expenditure per inhabitant, by category/product group
Relevant data is also available through the OECD database under the heading:
Prices and Purchasing Power Parities[1]
See also
References
This text is for information only and is not designed to interpret or replace any reference documents.
