implications of energy subsidy reform in india abstract this paper analyses welfare impact of energy subsidy reform in india based on the data from 1970 71 to 2014 15 to this end auto regressive distributed lag ardl model and error correction model ecm have been estimated to quantify the short run and long run price and the income elasticity of various energy products the results show that the price elasticity of demand for all fossil fuels is low but the respective income elasticity is higher therefore an increase in the general price level caused by the subsidy reform will lead to the erosion of real income and will have related welfare implications in india the results also reveal that energy expenditure will obviously increase and hence energy consumption will decline depending upon the extent of the withdrawal of subsidy therefore policy makers in india while undertaking further reforms must ensure that the subsidy reaches to those who truly deserve so that the socioeconomic casualty of reforms can be minimized along with achieving fiscal goals

overt interfunctional conflict and its reduction through business strategy we study why production and sales departments tend to disagree with the former wanting long production runs and the latter wanting a broad product line we then analyze why these disagreements lead to overt conflict in which functional areas fight with each other by presenting arguments that damage each other s position we show how the firm benefits from the information generated by this conflict in spite of these benefits the equilibrium conflict can exceed its profit maximizing level finally we show that concentrating innovative talent in only one department can help reduce interfunctional conflict

china s membership in the world trade organization wto and the exports of the developing economies of east asia a computable general equilibrium approach there is a general perception particularly among the developing countries of east asia that china s wto membership would spell bad news for their exports the asean countries in particular are quite concerned about its likely negative impact on their export and growth potentials in this light the main objective of this paper is to empirically assess the trade implications of china s wto membership for these countries only few studies using a computable general equilibrium cge approach have addressed the issue of china s wto membership trade implications further these studies have not adequately addressed the issue from the perspective of the developing countries of east asia particularly the asean countries using the latest version of the global trade analysis project gtap model and based on the latest tariff reduction commitments by china the results showed that contrary to the current perception and previous studies almost all of the developing countries of east asia are likely to benefi

the welfare implications of trade liberalisation between the southern mediterranean and the eu the impact on the southern mediterranean countries smc of the current process of trade liberalization with the european union is explored the methodology is that of computable general equilibrium modelling under imperfect competition and the model includes ten countries and 11 sectors this allows for both a cross country and cross sectoral analysis of the results the experiments considered are the full liberalization of tariffs as well as changes in market access and trade induced changes in productivity a key feature of the paper is that the phased introduction of tariff reductions is allowed for as explicitly envisaged in the agreements the results show that the process of liberalization may have a substantial though non monotonic impact on the smc economies in terms of both changes in production and through this on welfare the welfare impact is potentially very high in particular for the high tariff economies the sources of the welfare gain tend to derive from perfectly competitive explanat

the impacts of petroleum price fluctuations on income distribution across ethnic groups in malaysia crude oil price hikes have compelled governments of developing countries to let domestic prices of energy increase fiscal priorities made it impossible to fully compensate the hikes by raising energy subsidies this paper examines the potential impacts of a limited deregulation of the petroleum price on the income distribution in malaysia paying specific attention to differences in impacts on major ethnic groups we introduce an extended social accounting matrix sam model which not only incorporates substitution possibilities among production inputs and consumption goods but also allows for the exogenous determination of the price of intermediate inputs the results of simulations indicate that distributional impacts of rising petroleum prices tend to be regressive affecting poor people more severely than richer people all ethnic groups experience income loss with the real incomes of malay households which are relatively poor on average more than the chinese and indian households which are the generally richer

quantifying the impacts of energy price reform on living expenses in saudi arabia abstract as part of vision 2030 saudi arabia has initiated a broad based energy reform programme aimed at gradually reducing its dependence on oil this paper assesses the impacts of energy price reforms on living expenses of various household groups in saudi arabia for this purpose the input output table combined with household expenditure data are used to model the impacts results show that the distributional impacts of energy price reforms are regressive with low income households experiencing a higher increase in living expenses compared to high income households the impacts are primarily instigated by rising prices of energy intensive products after decomposing the impacts into direct and indirect effects it was found that indirect effect is not only responsible for a considerable rise in household expenditure on energy intensive products but it is also distributionally regressive it is therefore vital for policymakers to review and fine tune the social protection system to protect poor households against reforms

how does exchange rate policy affect manufactured exports in mena countries this paper shows that during the 1970s and 1980s mena economies were characterized by a significant overvaluation of their currency this overvaluation has had a cost in terms of competitiveness to determine the degree of overvaluation of the mena currencies an indicator of misalignment was developed based on the estimation of an equilibrium exchange rate edwards exchange rate misalignment in developing countries the johns hopkins university press baltimore 1988 the empirical work was based on a panel of 53 developing countries ten of which are mena economies although overvaluation decreased in the 1990s probably due to flexibilization of the exchange rate regime in some mena countries and to better macroeconomic management in others misalignment remained higher than in other regions this may be explained by the mena countries delay in adopting more flexible exchange rates as well as in reforming their economies in terms of competitiveness the estimation of an export equation has shown

an economic approach to influence activities in organizations members of organizations spend considerable time effort and ingenuity attempting to influence decision makers such influence activities may bring benefits to the organization but they also involve real costs this essay offers an economic rationale for such influence activity as representing rational self interested behavior in the presence of informational asymmetries and an analysis of how the design of the organization s structure and policies should respond to the incentives for attempting influence it is posited that information valuable for the organization s decision making is directly available only to members of the organization who have some personal stake in the decisions these individuals may then have an incentive to try to manipulate the information they develop and provide in order to influence the resulting decisions to their benefits this can be costly both in degrading the quality of decision making and in diverting the attention and effort of the organization s members from more productive activities the organization has three different methods it can employ to discourage excessive influence activities and to encourage more directly productive uses of time and effort it can limit access to decision makers and participation in decision making it can alter its decision making criteria to favor those performing well in productive activities and it can provide direct financial incentives to encourage the desired allocation of effort it is shown that an efficiently designed organization will use such financial incentives only as a last resort instead it will always first alter its decision participation policies and decisionmaking criteria

an evaluation of the impact of reducing energy subsidies on living expenses of households abstract a policy of subsidizing energy has been pursued in the islamic republic of iran to help the poor and to utilize the relative advantages of the country but it has been realized that energy subsidy has led to market distortion and welfare loss hence elimination of energy subsidy is considered as a crucial matter changes in energy policy are hindered by the uncertainty on the impact of reducing energy subsidy on the living expenses of population in the present article the distribution of resources through energy subsidy is evaluated and the direct and indirect effect of eliminating energy subsidies on the living expenses is estimated with the help of an analytical tool that has been developed it is then concluded that additional financial resources obtained from reduction of energy subsidies could be allocated for compensating the decrease in purchasing power of households the results of analysis reveal that more egalitarian distribution of resources and helping the poor could be achieved through implementation of a progressive policy of social security that is supported by financial resources available from elimination of energy subsidies

energy price reform and food markets the case of bread supply chain in iran reforming energy price is the core of iranian economic reform plan during 2010 2014 however increasing price of energy may have adverse effects on the agricultural and food markets this study was conducted to address these problems in the most important food of iranian people bread by developing a spatial supply chain model results show that consumers welfare would experience a sharp decrease though the impacts on farmers are trivial also results indicate that the key to success the reform without political backlash in the short run is the cash transfer program under which the government redistributes part of the reform s benefits among consumers per capita compensation payments would be equal to 51 50 and 46 09 us per year for a typical rural and urban person respectively moreover the results provide more detailed information about the market characteristics and the payments both in nationwide and regional scale as well as in different income groups

the validity of the elg hypothesis in the mena region cointegration and error correction model analysis the export led growth elg hypothesis is examined for nine middle east and north africa mena countries in three variable vector autoregressive and error correction models when considering total exports the results reject the elg hypothesis in almost all of these countries when only manufactured exports are examined no support is found for elg in countries with relatively low shares of manufactured exports in total merchandise exports but strong support in countries with relatively high shares these findings suggest that promoting exports may contribute to economic growth only after a certain threshold of manufactured exports has been reached

when truces collapse a longitudinal study of price adjustment routines we analyze the microfoundations of the routine in a study of price adjustment processes at a manufacturing firm existing theory says that truces balance cognitive and motivational differences across functions but there is scant evidence on how truces work we show both stability and change in routines for minor price adjustments routines incorporate truces in stable but separate market interpretations by the sales and marketing groups major price changes put truces at risk as latent conflict over information and interests becomes overt the ensuing battle shows how interests information and truces are intertwined in performing the routine routines are not just stable entities but adaptive performances that include conflict we illustrate how our approach addresses fundamental problems such as how firms perform economics how routines incorporate economic theory and how routines shape macroeconomic dynamics we argue that our approach can be extended to any routine based organizational work

measuring resource inequalities the concepts and methodology for an area based gini coefficient abstract although inequalities in income and expenditure are relatively well researched comparatively little attention has been paid to date to inequalities in resource use this is clearly a shortcoming when it comes to developing informed policies for sustainable consumption and social justice this paper describes an indicator of inequality in resource use called the ar gini the ar gini is an area based measure of resource inequality that estimates inequalities between neighbourhoods with regard to the consumption of specific consumer goods it is also capable of estimating inequalities in the emissions resulting from resource use such as carbon dioxide emissions from energy use and solid waste arisings from material resource use the indicator is designed to be used as a basis for broadening the discussion concerning food deserts to inequalities in other types of resource use by estimating the ar gini for a wide range of goods and services we aim to enhance our understanding of resource inequalities and their drivers identify which resources have highest inequalities and to explore trends in inequalities the paper describes the concepts underlying the construction of the ar gini and its methodology its use is illustrated by pilot applications specifically men s and boys clothing carpets refrigerators freezers and clothes washer driers the results illustrate that different levels of inequality are associated with different commodities the paper concludes with a brief discussion of some possible policy implications of the ar gini

household heterogeneity impact of removing energy subsidies in china direct and indirect effect abstract reforming subsidies for fossil fuels is a challenging prospect for many governments the impact of such a reform on households is a major concern for the government this paper investigates the heterogeneous impacts of eliminating energy subsidies on households in china from direct and indirect perspectives the results of the direct effects show that the removal of energy subsidies particularly for removing electricity and gas subsidies has a greater negative impact on the poor than on the rich from an indirect perspective this article shows that the lower the per capita disposable income the higher the proportion of consumption to disposable income and the greater the indirect impact of eliminating subsidies meanwhile the impact is not only related to household income but consumer goods moreover the indirect effects of eliminating subsidies on households differ across energy types specifically eliminating electricity subsidies has the greatest effect on households followed by transportation fuel and gas we suggest that targeted supportive measures need to be taken towards the implementation of subsidy reform particularly in countries with greater inequality to minimize the negative effects on the poor

how the removal of energy subsidy affects general price in china a study based on input output model abstract in china most energy prices are controlled by the government and are under priced which means energy subsidies existing reforming energy subsidies have important implications for sustainable development through their effects on energy price energy use and co 2 emission this paper applies a price gap approach to estimate china s fossil fuel related subsidies with the consideration of the external cost results indicate that the magnitude of subsidies amounted to cny 1214 24 billion in 2008 equivalent to 4 04 of gdp of that year subsidies for oil products are the largest followed by subsidies for the coal and electricity furthermore an input output model is used to analyze the impacts of energy subsidies reform on different industries and general price indexes the findings show that removal of energy subsidies will have significant impact on energy intensive industry and consequently push up the general price level yet with a small variation removing oil products subsidies will have the largest impact followed by electricity coal and natural gas however no matter which energy price increases ppi is always the most affected then gdp deflator with cpi being the least corresponding compensation measures should be accordingly designed to offset the negative impact caused by energy subsidies reform

letting the energy gini out of the bottle lorenz curves of cumulative electricity consumption and gini coefficients as metrics of energy distribution and equity energy services are fundamental determinants of the quality of life as well as the economic vitality of both industrialized and developing nations few analytic tools exist however to explore changes in individual household and national levels of energy consumption and utilization in order to contribute to such analyses we extend the application of lorenz curves to energy consumption we examined the distribution of residential electricity consumption in five countries norway usa el salvador thailand and kenya these countries exhibit a dramatic range of energy profiles with electricity consumption far more evenly distributed across the population in some industrialized nations than others and with further significant differences in the lorenz distribution between industrialized and industrializing economies the metric also provides critical insights into the temporal evolution of energy management in different states and nations we illustrate this with a preliminary longitudinal study of commercial and industrial electricity use in california during the economically volatile 1990s finally we explore the limits of lorenz analyses for understanding energy equity through a discussion of the roles that variations in energy conversion efficiency and climate play in shaping distributions of energy consumption the lorenz method which is widely employed by economists to analyze income distribution is largely unused in energy analysis but provides a powerful new tool for estimating the distributional dimensions of energy consumption its widespread use can make significant contributions to scientific and policy debates about energy equity in the context of climate change mitigation electric power industry deregulation and restructuring and the development of national infrastructure

manufacturing exports mining exports and growth cointegration and causality analysis for chile 1960 2001 this study examines the export led growth hypothesis using annual time series data from chile in a production function framework it addresses the problem of specification bias under which previous studies have suffered and focuses on the impact of manufactured and mining exports on productivity growth in order to investigate if and how manufactured and mining exports affect economic growth via increases in productivity the study uses johansen cointegration technique the estimation results can be interpreted as evidence of productivity enhancing effects of manufactured exports and of productivity limiting effects of mining exports

utility subsidy reform in abu dhabi a review and a computable general equilibrium analysis abstract electricity and water consumption in abu dhabi has increased substantially in recent years along with rapid economic and population growth as one of the oil producing economies located in arid regions abu dhabi s electricity and water are produced predominantly with fossil fuel based power water co generation which generate carbon emissions the consumption of electricity and water is heavily subsidized to support industrial growth lower cost of living and distribute state wealth to the population the low utility prices however may have contributed to high per capita carbon emissions for the emirate this paper reviews critical literature on energy subsidy policy for oil exporting economies we then examine the economic and environmental effects of water and electricity subsidy reduction in abu dhabi using a computable general equilibrium analysis the result shows that utility subsidy reduction alone increases gross domestic product gdp of the emirate through expanding the high value added service sector and reduces carbon emissions with decreasing carbon intensive industrial and utility productions meanwhile private consumption declines with decreasing wage electricity subsidy reduction in general has greater economic and environmental effects than water subsidy reduction the positive economic and environmental gains may incentivize utility subsidy reform in the long run when the negative wage effect is mitigated

middle east and north africa countries agricultural export potentials under trade reforms middle east and north africa mena countries future stand in the world s economy depends to a large extent on the potentials of their agriculture to perform in a free trade world european union eu is the largest market for agricultural products of mena countries though new outlets and new partnerships can expand the market of their products enhancing agriculture s potentials safeguards the economy s general expansion and impede the flee of mena countries huge labour reserves to the developed world in this work introducing a few possible trade reforms a general equilibrium model is employed to assess the impacts upon region s export potentials and welfare changes selecting certain distinct scenarios from a wide spectrum of anticipated trade reforms and feeding them into the model insights on the direction of the expected changes and rough estimates of accrued benefits can be extracted the model results suggest that the region might benefit the most under special provisions for developing cou

welfare implication of reforming energy consumption subsidies abstract reforming energy consumption subsidies in particular for fossil fuels has been frequently referred to as a quick win policy to enhance environmental mitigation in addition the removal of such subsidies may release a sizeable portion of a country s national budget for use on more productive targets one of the most recognized challenges of such reform is selling the new energy prices to citizens particularly those with a more fragile purchasing power several empirical and technical studies have prescribed that the reform might be supported by a direct compensation mechanism in order to ensure feasibility this is what was done during the recent energy subsidy reform in iran however the compensation mechanism implemented in iran s reform was successful at the beginning but did not proceed as expected this has raised questions about the feasibility and sustainability of the direct compensation mechanism and even of the reform policy itself in this paper we consider a stylized model where direct compensation is the instrument proposed to restore consumers utility against increased energy prices we find that when prices of other goods are affected by the announced reform policy the feasibility of a subsidy reform critically depends on the value of certain parameters the initial subsidization rate the share of energy in the consumers bundle and the energy portion of price of other goods

fossil fuel reform in developing states the case of trinidad and tobago a petroleum producing small island developing state abstract trinidad and tobago is an oil exporting small island developing state sids with a 0 12 contribution to global emissions and with important socio economic challenges it has producer electricity and transport fuel subsidies it is at an interesting juncture in subsidy reform the government faces the embeddedness of distributive justice norms that are contested by fiscal prudence and environmental stewardship norms the value of the paper is twofold first it develops a subsidy intractability framework to explain reform global narratives that highlights the power of agents the nature of contested economic justice and environmental norms and the availability of mechanisms for reform second this framework is used to explain reform narratives and trajectories in trinidad and tobago using data from public documents and from a unique elite survey of former and present heads of state politicians policy makers and stakeholders even in conditions of falling oil prices and national revenue and pressures to reduce emissions where redistributive justice arguments are heavily embedded in public discourses those aspects of the subsidy that have developmental or distributive justice goals are more intractable the results of the study have implications for carbon emission reduction strategies in developing states with fossil fuel reserves

an evaluation of the economic effects of higher energy prices in mexico abstract the analysis of this study examines the impact of an increase in the prices of gasoline and electricity on the mexican economy the analytical approach used consists of a general equilibrium model composed of 13 producing sectors 14 consuming sectors 4 household categories classified by income and one government the effects of the recently implemented increase in the price of gasoline and electricity of 26 2 on prices and quantities are examined the results are revealing for example the consequences of an increase in the prices of gasoline and electricity would be a decrease in output by all producing sectors of about 0 31 a fall in the consumption of goods and services by about 0 56 a reduction in total utility by 1 29 and higher revenue for the government of 0 31 when subjected to a sensitivity analysis the results are reasonably robust with regard to the assumption of the values of the substitution elasticities

kuwait s energy subsidy reduction examining economic and co2 emission effects with or without compensation abstract this paper examined economy wide impacts of reducing energy subsidy in kuwait a social accounting matrix sam was constructed and a computable general equilibrium cge model was developed the cge model was used to simulate separate and combined effects of a 25 reduction of subsidy to three energy products natural gas oil and electricity this policy shock was applied to the model in two scenarios in each round the subsidy reductions were applied to each energy product separately in turn and then finally simultaneously to all energy products in the first scenario subsidy reductions were applied and results were compared with the baseline scenario given in the sam this yielded adverse effects across a range of endogenous variables it leads to large energy price increases as high as 255 for electricity gross domestic product gdp marginally declined by 0 28 in scenario 2 the subsidy reduction was accompanied with cash transfers to energy users a compensation for welfare loss the amount of transfer was equivalent to the sum of the amount of subsidy reductions the results indicated that such transfers would reduce the adverse effects of the policy reform the effects on gdp was reversed it rose by 1 01 the price effect was slightly lower electricity price rose by 245 finally sensitivity of the model results was examined by varying the elasticity of the substitution of composite energy and capital in production greater possibility of substitution seems to cause subsidy reform to have much larger positive or smaller adverse economy wide effects the simulation experiments suggest that subsidy reform would need to be accompanied by demand side stimulus or supply side initiatives to encourage energy conservation