Logo
Munich Personal RePEc Archive

The long-run macroeconomic impacts of fuel subsidies in an oil-importing developing country

Plante, Michael (2011): The long-run macroeconomic impacts of fuel subsidies in an oil-importing developing country.

[thumbnail of MPRA_paper_33823.pdf]
Preview
PDF
MPRA_paper_33823.pdf

Download (411kB) | Preview

Abstract

Analytical and numerical results show how the presence of a subsidy on household and firm purchases of oil products distorts long-run macroeconomic aggregates in an oil-importing developing country. Beyond leading to over-consumption of oil products these subsidies also lead to increased labor supply, a distorted emphasis on producing traded goods, and higher real wages. The subsidy also impacts the relative price of non-traded goods, causing it to fall when the non-traded sector is more oil-intensive than the traded sector and vice-versa.

Atom RSS 1.0 RSS 2.0

Contact us: mpra@ub.uni-muenchen.de

This repository has been built using EPrints software.

MPRA is a RePEc service hosted by Logo of the University Library LMU Munich.