Energy subsidy reforms and the impacts on firms: Transmission channels and response measures

While the adverse effects of energy price increases following reforms are increasingly well understood for households, the existing literature has largely ignored the effect of subsidy reform on firms. This paper argues that this is a gap in the evidence base that must be addressed, in order to design and deliver reforms more effectively. In particular, attention must be paid to all the transmission channels for price shocks, as well as the available response measures. Only a full evaluation of these aspects can enable policy makers to make an informed assessment of the likely consequences of subsidy removal on economic activity and competitiveness. This paper outlines the most important transmission channels for energy price shocks and the response measures used by firms.

By: Jun Rentschler , Martin Kornejew

Latest Tweets from @OxfordEnergy

  • New OIES paper on oil price paths in 2019: In reference scenario, Brent expected to average $68/b in 2019; Brent ri… https://t.co/kxjN8ToXKD

    February 16th

  • Fattouh on Aramco’s overseas energy push: Saudi Aramco, like many energy majors, looks to muscle in on the growing… https://t.co/4Yw4rgjAdg

    February 14th

  • Oil Price Paths in 2019: Navigating Volatile Markets https://t.co/4FLbnPnksb

    February 13th

Sign up for our Newsletter

Register your email address here and we will send you notification of new publications, comment, articles etc. automatically.