Policies to address climate change and the energy transition are increasingly gaining ground. However, a large body of research has mainly focused on the efficiency aspect of different instruments rather than their unintended side-effects. Only recently, both policymakers as well as researchers...

I investigate how households and firms adjust their inflation expectations when experiencing an increase in their energy prices. I use monthly panel survey data in combination with a difference-in-difference approach to show that households increase their inflation expectations when they...