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Publication Details
AFRICAN RESEARCH NEXUS
SHINING A SPOTLIGHT ON AFRICAN RESEARCH
energy
Fossil fuel subsidy removal and inadequate public power supply: Implications for businesses
Energy Policy, Volume 45, Year 2012
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Description
We briefly consider the impact of fossil fuel subsidy removal policies in the context of inadequate power supply, with a focus on the implications for businesses. In doing so, we utilize the case of the early 2012 fuel subsidy removal in Nigeria. The rationale for such subsidy-removal policies is typically informed by analysis showing that they lead to an economically inefficient allocation of resources and market distortions, while often failing to meet intended objectives. However, often the realities of infrastructural and institutional deficiencies are not appropriately factored into the decision-making process. Businesses in many developing countries, already impaired by the high cost of power supply deficiencies, become even less competitive on an unsubsidized basis. We find that justifications for removal often do not adequately reflect the specific environments of developing country economies, resulting in poor recommendations - or ineffective policy. © 2012 Elsevier Ltd.
Authors & Co-Authors
Bazilian, Morgan D.
Austria, Laxenburg
International Institute for Applied Systems Analysis, Laxenburg
Onyeji-Nwogu, Ijeoma
Nigeria, Enugu
African Institute for Applied Economics
Statistics
Citations: 72
Authors: 2
Affiliations: 2
Identifiers
Doi:
10.1016/j.enpol.2012.02.057
ISSN:
03014215
Research Areas
Health System And Policy
Study Locations
Nigeria