Socio-economic Performance, Energy Crisis, and Trust in government: Evidence from the Russia-Ukraine Conflict in Europe

Energy drives the economy, and when energy prices rise sharply, there is a spillover effect on other sectors, affecting daily life. When citizens’ lifestyles are negatively affected, trust in government often declines. After the Russian-Ukraine war began in 2022, countries in Europe experienced an energy crisis experienced primarily as an acute consumer price shock driven by skyrocketing retail utility tariffs.. To reduce the social and economic consequences of this crisis, EU member states adopted various policy relief measures to support vulnerable households and firms. This paper examines how socio-economic factors and policy relief measures influenced trust in government during the 2022/2023 energy crisis. Specifically, we explicitly test how socio-economic pressures – namely inflation, unemployment and shifting GDP dynamics – and government policy relief measures are associated with changes in trust in government across EU member states during the 2022/2023 energy crisis. We use a two-way fixed effects panel analysis with aggregated country-year Eurobarometer survey data, Eurostat socio-economic indicators, and Bruegel’s dataset on fiscal allocations as a percentage of GDP across 27 European countries from 2019 to 2024 to establish a robust pre-crisis baseline. Our results show that higher unemployment and perceived corruption are negatively associated with trust in government. Conversely, government relief measures are linked to a subsequent increase with a one-period lag. These findings imply that to preserve institutional credibility during global supply-side shocks, state interventions must be highly visible, prompt, and directly tied to household economic cushions.