Energy Subsidies in the Arab World

uploaded 18 Jun 2012
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This report is part of the Arab Human Development Reports’ Research Paper Series which examines energy subsidies in the Arab region. It considers energy subsidies in the context of achieving overall welfare objectives related to expanding energy access and protecting poor households’ incomes; to economic development objectives such as fostering industrial growth and smoothing domestic consumption. While energy subsidies may be seen as achieving some of a country’s objectives, this paper argues they are a costly and inefficient way of doing so because they distort price signals, and have serious implications on efficiency and the optimal allocation of resources.

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