The Interplay Between Economic (In)Security and Energy Dependency: An Analysis of EU Countries

This article aims to analyze the impact of the energy sector on the economic security of European households over the period 2010–2023, addressing an important gap in the literature since there is no EU cross-country evidence linking energy dependence on non-EU countries to a multidimensional measure of household economic insecurity over a long-time span. To achieve our goal, the dependent variable considered was an aggregate index of economic insecurity developed in previous research and constructed based on three fundamental dimensions: basic needs of the household, household fragility, and the burden of unemployment. Subsequently, panel data regression analysis with fixed effects was performed (considering 23 EU countries and the time period 2010–2023). The results highlight how more energy dependency on third countries could lead to more economic insecurity for European households. The robustness tests confirmed the initial results and underlined structural differences between countries. The research demonstrates how the energy dependence of EU states on countries outside the EU could have serious repercussions on the long-term economic security of Europeans, but, at the same time, this can be counterbalanced by a possible shift towards domestic renewable energy sources. Based on these results, both our hypotheses were confirmed.