Olivier Sempiga


Geopolitical risks (GPRs) have varied consequences over countries and over time. COVID-19 and the war in Ukraine are some of the recent GPRs. The conflict in Ukraine has had far-reaching economic consequences, not only for the countries directly involved in it but also for their trading partners and allies, and on the global economy in general. France, as one of Ukraine and Russia's major trading partners, has also felt the impact of the conflict on its economy. Using data from the French National Institute of Statistics and Economic Studies (INSEE), the paper investigates the impact of GPRs caused by the war in Ukraine on price variation and citizen trust in France. The article conducts a multilinear regression analysis on datasets going back from immediately after the financial global crisis until the first quarter of 2023, with the war in Ukraine still ongoing. Results show that GPRs strongly affect the rise of prices of different products from oil products to food, beverages and other industry products, the association varying from strong to moderate. GPRs are also positively related to a reduction in citizen trust. The relationship between war and price, on the one hand, and the association between war and decrease in trust on the other, is confirmed by robustness checks.