Access Journal

Access to Science, Business, Innovation in the Digital Economy
The journal uses continuous publication model. Current issue is in progress.
Published Online: Feb 20, 2024

Drivers of perceptions towards euro adoption among the young: evidence from Bulgaria

Published Online: Feb 20, 2024
Views: 444
Downloads: 53
Download PDF

Abstract:
Objectives: Perceptions towards euro adoption in the general public are very important for the successful introduction of the common currency into a given economy. Young consumers tend to have lower interest and political participation rates, but their acceptance of a new currency is crucial. This paper investigates a sample of Bulgarian students in order to measure and model the preferences of young consumers towards adopting a new national currency, and potentially glean insights that could be useful for the formulation of public policy. Methods/Approach: We survey a total of 296 predominantly young participants asking them both traditional demographic questions as well as behavioral and political ones such as social network and online video usage as well as policy stance and trust in institutions. The variables are used as predictors in a regression modelling framework that investigates the drivers behind the dynamics of euro perceptions. Results: We find a strong and robust effect of overall trust in institutions on perceptions towards the euro, as well as an expected effect of the policy preference. The higher trust in institutions leads to a more positive attitude towards the adoption of the common currency. Similarly, more right-leaning pro-market policy preferences are also associated with a more favorable view of the euro. While the consumption of online videos is unimportant, the overall time spent in social networks does have a statistically significant positive effect on preferences. Conclusions: The results give some initial directions as to what policy should be undertaken to most effectively inform young consumers on the benefits of adopting the euro as a new currency, and how this demographic can be segmented to deliver information most efficiently.
Keywords:
Pages:
185-206
JEL Classification:
B52; D12; Z13; Z18
How to cite:
Gerunov, A., Atanasov, I., Yanchev, M., Shalvardjiev, D., Mengov, G., Egbert, H., Dineva, L., Pantcheva, R., Korcheva, A. (2024). Drivers of perceptions towards euro adoption among the young: evidence from Bulgaria. Access to science, business, innovation in the digital economy, ACCESS Press, 5(2), 185-206, https://doi.org/10.46656/access.2024.5.2(1)
References:
  • Álvarez González, L. J., Cuadrado Salinas, P., Jareño Morago, J., & Sánchez García, I. (2004). El impacto de la puesta en circulación del euro sobre los precios al consumo. Documentos ocasionales, 0404. Banco de España
  • Angelico, C., Marcucci, J., Miccoli, M., Quarta, F. (2022). Can we measure inflation expectations using Twitter?. Journal of Econometrics, 228(2), pp. 259-277. DOI: https://doi.org/10.1016/j.jeconom.2021.12.008
  • Backé, P., Beckmann, E. (2020). What drives people’s expectations of euro adoption?–Evidence from the OeNB Euro Survey on selected CESEE countries. Focus on European Economic Integration Q4, pp. 57-79
  • Backé, P., Beckmann, E. (2022). Euro adoption in CESEE: How do financial literacy and trust in institutions affect people’s attitudes?. Focus on European Economic Integration, (Q1/22), pp. 7-28
  • Buiten, G. (2003). Why inflation still feels so high, CBS Magazine, Statistics Netherlands, available at https://www.cbs.nl/en-gb/news/2003/25/why-inflation-still-feels-so-high (accessed 16.09.2023)
  • Čábelková, I., Mitsche, N., Strielkowski, W. (2015). Attitudes towards EU integration and Euro adoption in the Czech Republic. ECONOMICS & SOCIOLOGY, 8(2), pp. 93–101. DOI: https://doi.org/10.14254/2071-789X.2015/8-2/7
  • Conrad, C., Enders, Z., Glas, A. (2022). The role of information and experience for households’ inflation expectations. European Economic Review, 143, p. 104015. DOI: https://doi.org/10.1016/j.euroecorev.2021.104015
  • Gamble, A. (2006). Euro illusion or the reverse? Effects of currency and income on evaluations of prices of consumer products. Journal of Economic Psychology, 27(4), 531-542
  • Giovane, P., Sabbatini, R. (Eds.). (2008). The Euro, Inflation and Consumers’ Perceptions. Springer Berlin Heidelberg. DOI: https://doi.org/10.1007/978-3-540-78370-1
  • Genge, E. (2014). A latent class analysis of the public attitude towards the euro adoption in Poland. Advances in Data Analysis and Classification, 8(4), pp. 427–442. DOI: https://doi.org/10.1007/s11634-013-0156-0
  • Hobolt, S. B., Wratil, C. (2015). Public opinion and the crisis: the dynamics of support for the euro. Journal of European Public Policy, 22(2), pp. 238-256. DOI: https://doi.org/10.1080/13501763.2014.994022
  • Jemec, N. (2010). Inflation perceptions and expectations around euro changeover. Banka Slovenije, Prikazi in analize br, 1.
  • Jonung, L., Conflitti, C. (2008). Is the Euro Advantageous?: Does it Foster European Feelings?: Europeans on the Euro After Five Years. European Commission, Directorate-General for Economic and Financial Affairs
  • Kitanova, M. (2020). Youth political participation in the EU: evidence from a cross-national analysis. Journal of Youth Studies, 23(7), pp. 819-836. DOI: https://doi.org/10.1080/13676261.2019.1636951
  • Kurri, S. (2006). Why does consumers’ perceived inflation differ so much from actual inflation?. Bank of Finland, Bulletin 3, pp. 75-81
  • Lamla, M. J., Lein, S. M. (2014). The role of media for consumers’ inflation expectation formation. Journal of Economic Behavior & Organization, 106, 62-77
  • Lunn, P. D., Duffy, D. (2015). Perceptual noise and perceived inflation after the Euro currency changeover. Journal of Behavioral and Experimental Finance, 7, 1-16
  • Pollan, W. (2002). Price Development upon Introduction of Euro Banknotes and Coins. Austrian Economic Quarterly, 7(4), 167-175
  • Pufnik, A. (2017). Effects of the adoption of the euro on consumer prices and inflation perceptions: an overview of experiences and assessment of the possible impact in Croatia. Croatian National Bank, Zagreb
  • Simeonov, K. (2022). Myths and realities about the euro and Bulgaria. DIPLOMACY, 29, pp. 118-132
  • Walschots, J. (2002). Why does inflation feel so high?. CBS Magazine, Statistics Netherlands, available at: https://www.cbs.nl/en-gb/news/2002/24/why-does-inflation-feel-so-high- (accessed 16.09.2023)
  • Yotzov, V. (2023). The Euro and Bulgaria–Fears and Hopes. Economic Studies, 32 (3), 3-18
  • Zimková, E., Farkašovský, V., Szostak, J. (2018). Perception of the Euro vs. The Economic Performance of EU States. Zeszyty Naukowe Wyższej Szkoły Bankowej w Poznaniu, 2(79), pp. 69–81. DOI: https://doi.org/10.26349/zn.wsb.w.poznaniu.0079.05

Publish your science journal

If you like ACCESS journals system, you can publish your journal with us at a reasonable price