Problem
The model currently captures imported inflation through two reduced-form channels:
- FX/import pass-through in
PriceLevel.importPush
- commodity / energy cost pass-through into firm P&L and Calvo markups
That is directionally correct, but it is still missing the direct household-CPI channel that dominated Polish inflation during episodes like COVID supply shocks and the Russia-Ukraine energy shock.
In the current implementation, an energy shock is represented mainly as a producer-cost shock. There is no explicit household energy basket component (electricity, gas, heating, fuels) with administered pricing / tariff smoothing / delayed pass-through.
Why this matters
For an agent-based macro model, imported inflation should be modeled explicitly enough to distinguish:
- FX-driven imported inflation
- commodity / energy shock inflation
- direct household energy CPI effects
- delayed / buffered pass-through via regulated prices and state-owned suppliers
Without that split, 2021-2023 style inflation is only partially represented.
Current code shape
Relevant pieces today:
PriceLevel.importPush depends on FX deviation and aggregate import propensityGvcTrade provides commodityPriceIndex and importCostIndexFirm.energyAndEtsCost passes commodity prices into producer costsCalvoPricing.energyCostPressure passes part of that into firm markupsStateOwned.effectiveEnergyPassthrough partially buffers pass-through
This is useful, but still too indirect for household CPI energy inflation.
Proposed direction
Add an explicit imported-energy inflation block, for example:
- introduce a household energy CPI component (electricity / gas / heating / fuels)
- drive it from
commodityPriceIndex, importCostIndex, and FX
- add administered-price / tariff smoothing and optional temporary freezes
- keep SOE / public buffering as a separate pass-through layer
- aggregate headline CPI from core + food + energy-style components, or at least from core + explicit energy component
Acceptance criteria
- a commodity shock can raise CPI even without a large PLN depreciation
- the model distinguishes direct household energy inflation from producer-cost pass-through
- tariff buffering / delayed pass-through can be switched on and calibrated
- diagnostic output can show how much CPI comes from FX vs commodity/energy vs domestic channels
Notes
This is not just a calibration tweak. It is a structural gap in inflation modeling for a Poland-style open economy with energy import dependence and regulated price buffering.
Problem
The model currently captures imported inflation through two reduced-form channels:
PriceLevel.importPushThat is directionally correct, but it is still missing the direct household-CPI channel that dominated Polish inflation during episodes like COVID supply shocks and the Russia-Ukraine energy shock.
In the current implementation, an energy shock is represented mainly as a producer-cost shock. There is no explicit household energy basket component (electricity, gas, heating, fuels) with administered pricing / tariff smoothing / delayed pass-through.
Why this matters
For an agent-based macro model, imported inflation should be modeled explicitly enough to distinguish:
Without that split, 2021-2023 style inflation is only partially represented.
Current code shape
Relevant pieces today:
PriceLevel.importPushdepends on FX deviation and aggregate import propensityGvcTradeprovidescommodityPriceIndexandimportCostIndexFirm.energyAndEtsCostpasses commodity prices into producer costsCalvoPricing.energyCostPressurepasses part of that into firm markupsStateOwned.effectiveEnergyPassthroughpartially buffers pass-throughThis is useful, but still too indirect for household CPI energy inflation.
Proposed direction
Add an explicit imported-energy inflation block, for example:
commodityPriceIndex,importCostIndex, and FXAcceptance criteria
Notes
This is not just a calibration tweak. It is a structural gap in inflation modeling for a Poland-style open economy with energy import dependence and regulated price buffering.