Socio-economic Performance and Political Trust: The effect of regulatory measures during the energy crisis in the aftermath of the Russia-Ukraine Conflict on European Citizens

The conflict between Russia and Ukraine caused far-reaching economic consequences to different European Union (EU) countries. Since most of these countries are not only Ukraine and Russia's major trading partners and heavily rely on Russian energy sources, they were plagued by surging and volatile energy prices. As energy is a locomotive of the economy, once energy prices skyrocket there is a spillover effect in other areas causing inflation, thereby affecting people’s social economic lifestyles. Yet once people’s social economic lifestyles are affected their trust in government is likely to reduce. To minimize the impact of inflation and other socio-economic consequences resulting from energy crisis, the EU and its member states adopted regulatory mechanisms to support vulnerable households and firms. Following the 2022/2023 energy crisis, several regulatory measures were adopted both at the national and the EU levels to counter the impact of soaring energy prices for households and limit employment loss in firms. As demonstrated by the 2008 economic crisis, in a major crisis trust in government and institutions is likely to decline if people’s socio-economic security is negatively affected (Uslaner, 2010; Gillespie & Hurley, 2013). We carry out fixed effects analysis. Preliminary results show that social-economic factors like unemployment and Corruption Perceptions Index affect trust. Regulatory measures taken by governments in the European Union have also influenced citizens trust in the government.