TY - JOUR
T1 - The distributional impacts of removing energy subsidies in China
AU - Jiang, Zhujun
AU - Ouyang, Xiaoling
AU - Huang, Guangxiao
N1 - Publisher Copyright:
© 2015.
PY - 2015/4/1
Y1 - 2015/4/1
N2 - The distributional impact on households is an important factor for the acceptance of energy subsidy reform. Based on energy consumption features of the Chinese households at different income levels, this paper adopts an input-output price model to analyze possible impacts of removing energy subsidies on income distribution under different scenarios. Results show that: (1) The distributional impacts of removing subsidies vary by fossil fuels. From the perspectives of combined effects, transport fuel subsidy removal and coal subsidy removal have the strongest and the weakest progressive effects respectively, while the removal of electricity subsidies has a regressive effect. Moreover, the removal of petroleum product subsidies has the greatest impact on households, followed by the removal of electricity and coal subsidies, respectively. (2) Indirect impacts of energy subsidy reform are greater than direct impacts on households. (3) Government price controls can reduce the negative impact of energy subsidy reform. Policy implications are thus summarized. Energy subsidy reform can start from the energy that has the strongest progressive effect and the minimum impact on households. The Chinese government can take certain compensatory measures to mitigate the impact of reform on poor households.
AB - The distributional impact on households is an important factor for the acceptance of energy subsidy reform. Based on energy consumption features of the Chinese households at different income levels, this paper adopts an input-output price model to analyze possible impacts of removing energy subsidies on income distribution under different scenarios. Results show that: (1) The distributional impacts of removing subsidies vary by fossil fuels. From the perspectives of combined effects, transport fuel subsidy removal and coal subsidy removal have the strongest and the weakest progressive effects respectively, while the removal of electricity subsidies has a regressive effect. Moreover, the removal of petroleum product subsidies has the greatest impact on households, followed by the removal of electricity and coal subsidies, respectively. (2) Indirect impacts of energy subsidy reform are greater than direct impacts on households. (3) Government price controls can reduce the negative impact of energy subsidy reform. Policy implications are thus summarized. Energy subsidy reform can start from the energy that has the strongest progressive effect and the minimum impact on households. The Chinese government can take certain compensatory measures to mitigate the impact of reform on poor households.
KW - Distributional impact
KW - Energy subsidies
KW - Input-output price model
UR - https://www.scopus.com/pages/publications/84922378906
U2 - 10.1016/j.chieco.2015.01.012
DO - 10.1016/j.chieco.2015.01.012
M3 - 文章
AN - SCOPUS:84922378906
SN - 1043-951X
VL - 33
SP - 111
EP - 122
JO - China Economic Review
JF - China Economic Review
ER -
