The Unequal Benefits of Fuel Subsidies: A Review of Evidence for Developing Countries

By F. J. Granado, David Coady, R. Gillingham. Social Science Research Network, 2012

491 citations recorded by the source corpus.

This paper reviews evidence on the impact of fuel subsidy reform on household welfare in developing countries. On average, the burden of subsidy reform is substantial and is approximately neutrally distributed across income groups; a $0.25 decrease in the per liter subsidy results in a 5% decrease in income for all groups. More than half of this impact arises from the indirect impact on prices of other goods and services consumed by households. Fuel subsidies are a costly approach to protecting the poor due to substantial benefit leakage to higher income groups; in absolute terms, the top income quintile captures six times more in subsidies than the bottom.

Subfields: Economics and Econometrics, Renewable Energy, Sustainability and the Environment

View Paper: https://www.semanticscholar.org/paper/d7fed5ccd0c8e6af1ff664442325b11ef095812f

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Citations in the corpus

Reviewing, Reforming, and Rethinking Global Energy Subsidies: Towards a Political Economy Research Agenda (2017, unknown): “However, Arze del Granado et al. (2012) documented that across 20 developing countries, subsidies were in fact regressive (Arze del Granado et al., 2012).”
Reforming fossil fuel subsidies: drivers, barriers and the state of progress (2017, background): “Arze del Granado et al. (2012) show for 20 developing countries that the poorer households consume a disproportionately small fraction of the total fuel and electricity supply.”
Household cooking fuel choice and adoption of improved cookstoves in developing countries : a review (2014, background): “Miller and Mobarak (2013) find that women in rural Bangladesh, who bear disproportionate cooking costs, have stronger preference for ICS but they lack the authority to make the purchase.”
How Large are Global Energy Subsidies? (2015, unknown): “1 See, for example, Arze del Granado et al. (2012), Breisinger et al. (2011), Burniaux et al. (2009), Clements et al. (2007), Di Bella et al. (2015), Ellis (2010), Escribano et al. (2008), Fofana et al. (2009), Gelb et al. (1998), Heggie and Vickers (1998), Kumar and Woo (2010), Lofgren (1995),…”
How Large Are Global Fossil Fuel Subsidies (2017, background): “See Arze del Granado, Coady, and Gillingham (2012), Clements, Coady, Fabrizio, Gupta, Alleyne, and Sdralevich (2013), Coady, Flamini, and Sears (2015), International Energy Agency (IEA) (2011).”