Should Indonesia Suffer from More Reduction of the Subsidy to the Petroleum Sector?
We numerically examine the impact of the actually implemented reduction policy of the subsidy to the petroleum sector by using a static CGE model with the latest input-output table of Indonesia of year 2008. Our simulation results indicate that the Indonesian economy suffered from the actually implemented policy with a welfare loss of 28,417.78 billion rupiah even with the conversion policy. Furthermore, the proposed future reduction policy by the Ministry of Finance would unavoidably result in a welfare loss even when the government continues the current conversion policy. However, our simulation results also suggest that a new future conversion policy with a slightly additional subsidy to the LPG sector would eventuate in completely offsetting the negative effect of the proposed plan on the future welfare with an expanding government expenditure.
|Date of creation:||Dec 2011|
|Contact details of provider:|| Postal: 777 Kokusai-cho, Minami Uonuma0-shi, Niigata 949-7277 JAPAN|
Web page: http://www.iuj.ac.jp/research/
More information through EDIRC
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- N/A, 1985. "General Policy," India Quarterly: A Journal of International Affairs, , vol. 41(1), pages 74-79, January.
- Ballard, Charles L. & Fullerton, Don & Shoven, John B. & Whalley, John, 2009.
"A General Equilibrium Model for Tax Policy Evaluation,"
National Bureau of Economic Research Books,
University of Chicago Press,
edition 0, number 9780226036335.
- Charles L. Ballard & Don Fullerton & John B. Shoven & John Whalley, 1985. "A General Equilibrium Model for Tax Policy Evaluation," NBER Books, National Bureau of Economic Research, Inc, number ball85-1, October.
- Charles L. Ballard & Don Fullerton & John B. Shoven & John Whalley, 1985. "Introduction to "A General Equilibrium Model for Tax Policy Evaluation"," NBER Chapters,in: A General Equilibrium Model for Tax Policy Evaluation, pages 1-5 National Bureau of Economic Research, Inc.
- Ihori, Toshihiro & Kato, Ryuta Ray & Kawade, Masumi & Bessho, Shun-ichiro, 2011. "Health insurance reform and economic growth: Simulation analysis in Japan," Japan and the World Economy, Elsevier, vol. 23(4), pages 227-239.
- Toshihiro Ihori & Ryuta Ray Kato & Masumi Kawade & Shun-ichiro Bessho, 2011. "Health Insurance Reform and Economic Growth: Simulation Analysis in Japan," Working Papers EMS_2011_17, Research Institute, International University of Japan.
- Djoni Hartono & Budy P. Resosudarmo, 2006. "The Economy-wide Impact of Fuel Oil, Gas and Electricity Pricing and Subsidy Policies as well as Their Consumption Improvement Efficiency in Indonesia," Working Papers in Economics and Development Studies (WoPEDS) 200611, Department of Economics, Padjadjaran University, revised Dec 2006.
- N/A, 1985. "General Policy," India Quarterly: A Journal of International Affairs, , vol. 41(1), pages 112-117, January.
- Scarf,Herbert E. & Shoven,John B., 2008. "Applied General Equilibrium Analysis," Cambridge Books, Cambridge University Press, number 9780521070935, August.
- Sa'ad, Suleiman, 2009. "An empirical analysis of petroleum demand for Indonesia: An application of the cointegration approach," Energy Policy, Elsevier, vol. 37(11), pages 4391-4396, November. Full references (including those not matched with items on IDEAS)
When requesting a correction, please mention this item's handle: RePEc:iuj:wpaper:ems_2011_25. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Kazumi Imai, Office of Academic Affairs)
If references are entirely missing, you can add them using this form.