Over the past five years, food and energy price surges have strained household budgets and fueled economic and social pressures across the world. This chapter examines cost-of-living crises: episodes marked by sharp increases in the price of basic necessities, falling purchasing power, and persistently higher inflation and inflation expectations, as well as worsening inequality and poverty. Drawing on new evidence from a global database of policy interventions and a novel economic model, it assesses how governments have responded and which policies work best. The findings show that targeted, temporary transfers offer the most effective and cost-efficient protection for vulnerable households, while preserving fiscal space and allowing prices to adjust. By contrast, measures that suppress prices can require 3 to 22 times more fiscal resources and may become ineffective when fiscal space is limited or many countries adopt them simultaneously.