The Economy-wide Impact of Fuel Oil, Gas and Electricity Pricing and Subsidy Policies as well as Their Consumption Improvement Efficiency in Indonesia
In Indonesia, the government determines the domestic prices of energy; namely fuel oil, such as gasoline, automotive diesel oil (ADO) and kerosene, gas and electricity. In response to the weakening of rupiah during the 1997/1998 economic crisis and the increasing of the world price of crude oil, the government tends to increase the energy subsidy on domestic prices of fuel oil, gas and electricity, rather than letting these domestic prices follows the world prices of fuel oil, gas and electricity. Currently domestic prices of fuel oil, such as gasoline, automotive diesel oil, kerosene as well as gas and electricity are significantly lower than the world prices of those commodities. Meanwhile government subsidy for fuel oil, gas and electricity has reached approximately 30 per cent of total government expenditure. There have been suggestions that the government should eliminate this subsidy letting the prices of fuel oil, gas and electricity equal to the world prices, since, among others, energy subsidy has foregone government’s opportunities to spend more on development expenditures that would improve the country’s growth rate. On the other hand various groups keep pressing the government to keep the prices of fuel oil, gas and electricity; i.e. do not reduce the energy subsidy, since the poor could not afford higher prices of fuel oil, gas and electricity.
|Date of creation:||Dec 2006|
|Date of revision:||Dec 2006|
|Contact details of provider:|| Postal: |
Web page: http://ceds.fe.unpad.ac.id
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.:
- Shoven, John B & Whalley, John, 1984. "Applied General-Equilibrium Models of Taxation and International Trade: An Introduction and Survey," Journal of Economic Literature, American Economic Association, vol. 22(3), pages 1007-51, September.
- 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.
- Robinson, Sherman, 1991. "Macroeconomics, financial variables, and computable general equilibrium models," World Development, Elsevier, vol. 19(11), pages 1509-1525, November.
- 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.
- Naqvi, Farzana, 1998. "A computable general equilibrium model of energy, economy and equity interactions in Pakistan," Energy Economics, Elsevier, vol. 20(4), pages 347-373, September.
- Budy Resosudarmo, 2002.
"Indonesia's Clean Air Program,"
Bulletin of Indonesian Economic Studies,
Taylor & Francis Journals, vol. 38(3), pages 343-365.
- Mark D. Partridge & Dan S. Rickman, 1998. "Regional Computable General Equilibrium Modeling: A Survey and Critical Appraisal," International Regional Science Review, , vol. 21(3), pages 205-248, December.
- 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.
When requesting a correction, please mention this item's handle: RePEc:unp:wpaper:200611. 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: (Arief Anshory Yusuf)
If references are entirely missing, you can add them using this form.