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The Economy-wide Impact of Controlling Energy Consumption in Indonesia: An Analysis Using a Social Accounting Matrix Framework

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Author Info

  • Djoni Hartono

    ()
    (Department of Economics, University of Indonesia)

  • Budy P. Resosudarmo

    ()
    (Australian National University)

Abstract

Escalating oil prices and the need to control carbon emissions sound the alarm for Indonesia to reduce or be more efficient in its energy use. To create an incentive for society to be more energy efficient, the government needs to reduce the current energy subsidy, which, in any case, has imposed a tremendous fiscal burden on the country. This paper aims to analyse the impact on the economy of energy policies aiming to reduce and to improve the efficiency of energy use, particularly on the income of various household groups. This paper will, first, construct a Social Accounting Matrix for Indonesia with detailed energy sectors and, second, utilise various multiplier analyses to observe and understand the impact of these energy policies.

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File URL: http://lp3e.fe.unpad.ac.id/wopeds/200702.pdf
File Function: First version, 2007
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Bibliographic Info

Paper provided by Department of Economics, Padjadjaran University in its series Working Papers in Economics and Development Studies (WoPEDS) with number 200702.

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Length: 28 pages
Date of creation: Jan 2007
Date of revision: Jan 2007
Handle: RePEc:unp:wpaper:200702

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Keywords: Social Accounting Matrix; Energy; Indonesia;

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References

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  1. Koop, Gary, 2001. "Cross-Sectoral Patterns of Efficiency and Technical Change in Manufacturing," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 42(1), pages 73-103, February.
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  3. Lewis, Blane D. & Thorbecke, Erik, 1992. "District-level economic linkages in Kenya: Evidence based on a small regional social accounting matrix," World Development, Elsevier, vol. 20(6), pages 881-897, June.
  4. Budy Resosudarmo, 2002. "Indonesia's Clean Air Program," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 38(3), pages 343-365.
  5. Budy Resosudarmo & Erik Thorbecke, 1998. "Reducing the Number of Pesticide- Related Illnesses: The Impact on Household Incomes in Indonesia," Bulletin of Indonesian Economic Studies, Taylor & Francis Journals, vol. 34(2), pages 143-157.
  6. World Bank, 2006. "Making the New Indonesia Work for the Poor," World Bank Other Operational Studies 8172, The World Bank.
  7. François Bourguignon & Anne-Sophie Robilliard & Sherman Robinson, 2003. "Representative versus real households in the macro-economic modeling of inequality," Working Papers DT/2003/10, DIAL (Développement, Institutions et Mondialisation).
  8. Defourny, Jacques & Thorbecke, Erik, 1984. "Structural Path Analysis and Multiplier Decomposition within a Social Accounting Matrix Framework," Economic Journal, Royal Economic Society, vol. 94(373), pages 111-36, March.
  9. Brookes, Len, 1990. "The greenhouse effect: the fallacies in the energy efficiency solution," Energy Policy, Elsevier, vol. 18(2), pages 199-201, March.
  10. Khanna, Madhu & Zilberman, David, 2001. "Adoption of energy efficient technologies and carbon abatement: the electricity generating sector in India," Energy Economics, Elsevier, vol. 23(6), pages 637-658, November.
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  13. Binswanger, Mathias, 2001. "Technological progress and sustainable development: what about the rebound effect?," Ecological Economics, Elsevier, vol. 36(1), pages 119-132, January.
  14. J. Daniel Khazzoom, 1980. "Economic Implications of Mandated Efficiency in Standards for Household Appliances," The Energy Journal, International Association for Energy Economics, vol. 0(Number 4), pages 21-40.
  15. Pyatt, F Graham & Round, Jeffery I, 1979. "Accounting and Fixed Price Multipliers in a Social Accounting Matrix Framework," Economic Journal, Royal Economic Society, vol. 89(356), pages 850-73, December.
  16. Pacudan, Romeo & de Guzman, Elaine, 2002. "Impact of energy efficiency policy to productive efficiency of electricity distribution industry in the Philippines," Energy Economics, Elsevier, vol. 24(1), pages 41-54, January.
  17. Benedict CLEMENTS & Hong-Sang JUNG & Sanjeev GUPTA, 2007. "Real And Distributive Effects Of Petroleum Price Liberalization: The Case Of Indonesia," The Developing Economies, Institute of Developing Economies, vol. 45(2), pages 220-237.
  18. Resosudarmo, Budy P. & Thorbecke, Erik, 1996. "The impact of environmental policies on household incomes for different socio-economic classes: The case of air pollutants in Indonesia," Ecological Economics, Elsevier, vol. 17(2), pages 83-94, May.
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Citations

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Cited by:
  1. Budy P Resosudarmo & Ariana Alisjahbana & Ditya Agung Nurdianto, 2010. "Energy Security in Indonesia," Departmental Working Papers 2010-08, The Australian National University, Arndt-Corden Department of Economics.
  2. Akkemik, K. Ali, 2011. "Potential impacts of electricity price changes on price formation in the economy: a social accounting matrix price modeling analysis for Turkey," Energy Policy, Elsevier, vol. 39(2), pages 854-864, February.
  3. Hasan, M.H. & Muzammil, W.K. & Mahlia, T.M.I. & Jannifar, A. & Hasanuddin, I., 2012. "A review on the pattern of electricity generation and emission in Indonesia from 1987 to 2009," Renewable and Sustainable Energy Reviews, Elsevier, vol. 16(5), pages 3206-3219.
  4. Alvaro Gallardo & Cristian Mardones, 2013. "Environmentally extended social accounting matrix for Chile," Environment, Development and Sustainability, Springer, vol. 15(4), pages 1099-1127, August.

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