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Navigating policy dilemmas in fuel-subsidy reductions: learning from Indonesia’s experiences

Jazuli, MR; Steenmans, I; Mulugetta, Y; (2021) Navigating policy dilemmas in fuel-subsidy reductions: learning from Indonesia’s experiences. Sustainability: Science, Practice and Policy , 17 (1) pp. 391-403. 10.1080/15487733.2021.2002024. Green open access

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Abstract

Fuel subsidies are policy instruments that have historically been used to assist the poor in affording energy for essential household activities. The subventions have, however, been the subject of considerable criticism that they in practice exacerbate inequalities and enrich fuel producers and well-to-do households that do not require support from fuel subsidies. When efforts to resolve tensions across different stakeholder needs lead to unintended, undesirable, and differential impacts across groups and across different time horizons, a policy dilemma emerges. Actors looking to understand or inform fuel-subsidy reform face an analytical challenge in knowing how to effectively frame important interlinkages and identify strategies for intervention. This policy brief responds to this analytical challenge in understanding interlinkages that frame these policy dilemmas by using John Kingdon’s multiple-policy stream framework to analyze how the Indonesian government navigated its energy subsidy reform policy dilemma during 1998–2016. It shares lessons on how the country has managed this situation and discusses implications for further domestic reforms. The Indonesian experience may provide useful insights and lessons for other developing countries looking to navigate the multiple interlinkages across fuel-subsidy dilemmas.

Type: Article
Title: Navigating policy dilemmas in fuel-subsidy reductions: learning from Indonesia’s experiences
Open access status: An open access version is available from UCL Discovery
DOI: 10.1080/15487733.2021.2002024
Publisher version: https://doi.org/10.1080/15487733.2021.2002024
Language: English
Additional information: © 2021 The Author(s). Published by Informa UK Limited, trading as Taylor & Francis Group. This is an Open Access article distributed under the terms of the Creative Commons Attribution License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Keywords: Fuel-subsidy reform; policy dilemma; Indonesia; reform policy; problem structuring
UCL classification: UCL
UCL > Provost and Vice Provost Offices > UCL BEAMS
UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of Engineering Science
UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of Engineering Science > STEaPP
URI: https://discovery.ucl.ac.uk/id/eprint/10139591
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