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Fuel Subsidies Drag Down a Nation

Posted on August 16, 2008

Why lump-sum transfers are better than fuel subsidies:How Fuel Subsidies Drag Down a Nation, by Robert H. Frank, Ecponomic View, NY Times: ...[M]any emerging economies employ subsidies that keep domestic fuel prices far below the world price. As a result, these countries consume far more fuel than they would otherwise. By one estimate, countries with fuel subsidies accounted for virtually the entire increase in worldwide oil consumption last year. Without this artificial demand stimulus, world oil prices would have been significantly lower. ...It would surely be unrealistic to expect other gov...

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carbon , demand , economic , energy prices , fuel prices , oil prices