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The Economic Cost of Global Fuel Subsidies / Lucas W. Davis.
- Format:
- Book
- Author/Creator:
- Davis, Lucas W.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w19736.
- NBER working paper series no. w19736
- Language:
- English
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 2013.
- Summary:
- By 2015, global oil consumption will reach 90 million barrels per day. In part, this high level of consumption reflects the fact that many countries provide subsidies for gasoline and diesel. This paper examines global fuel subsidies using the latest available data from the World Bank, finding that road-sector subsidies for gasoline and diesel totaled $110 billion in 2012. Pricing fuels below cost is inefficient because it leads to overconsumption. Under baseline assumptions about supply and demand elasticities, the total annual deadweight loss worldwide is $44 billion. Incorporating external costs increases the economic costs substantially.
- Notes:
- Print version record
- December 2013.
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