## Energy Subsidies and Energy Consumption: A Cross-Country Analysis

_IMF Working Papers, May 16, 2013_

## Source details

**Canonical URL:** [Energy Subsidies and Energy Consumption: A Cross-Country Analysis](https://www.imf.org/en/publications/wp/issues/2016/12/31/energy-subsidies-and-energy-consumption-a-cross-country-analysis-40544)

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## Bibliographic details
- Authors: Joshua Charap, Arthur Ribeiro da Silva, Pedro C Rodriguez
- Published: May 16, 2013
- Series: IMF Working Papers
- DOI: https://doi.org/10.5089/9781484367247.001

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### Summary
- Research objective: analyze a panel of cross-country data to explore the responsiveness of energy consumption to changes in energy prices and implications for energy subsidy reform.
- Core finding: long-term price elasticity of energy demand between -0.3 and -0.5.
- Short-term finding: short-term gains from subsidy reform are likely to be much smaller.
- Policy suggestion from authors: consider either a gradual approach to subsidy reform or provide more generous safety nets in the short term.

### Key findings and quantitative results
- Long-term price elasticity of energy demand: between -0.3 and -0.5.
- Short-term effects: quantitatively smaller than long-term effects (exact short-term elasticity values not reported on the landing page).

### Policy implications and recommendations
- Reform of energy subsidies can yield significant long-term benefits given estimated long-term elasticities.
- Because short-term gains are likely to be much smaller:
  - Adopt a gradual approach to subsidy reform, or
  - Provide more generous safety nets during the transition period.

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_Source: https://www.imf.org/en/publications/wp/issues/2016/12/31/energy-subsidies-and-energy-consumption-a-cross-country-analysis-40544_