Macroeconomic analysis of fuel subsidy reforms in ASEAN countries
Author Identifier (ORCID)
Abstract
Countries in the Association of Southeast Asian Nations (ASEAN) have a long history of fuel subsidy policies and are now undertaking substantial reforms. This chapter aims to contribute to the debate on fuel subsidy policy in ASEAN countries by using the pooled mean group (PMG) estimator and monthly panel data from 2003m1 to 2022m10. The empirical results show that removing fuel subsidies affects overall household consumption, GDP, and oil prices in both the short and long run of these countries. Thus, abolishing fuel subsidies in ASEAN countries may significantly alter citizens' living standards. Hence, the policy recommendations for ASEAN countries include adopting a non-price energy policy in the energy sector, such as autonomous energy efficiency improvement and green energy technologies. Doing so will promote the development of a clean and diversified energy economy and maintain the growth trajectories of ASEAN countries.
Document Type
Book Chapter
Date of Publication
1-1-2025
Publication Title
Energy Economics Finance and Management in Developing and Emerging Economies
Publisher
Elsevier
School
School of Business and Law
Copyright
subscription content
First Page
95
Last Page
113
Comments
Foo, N., Lean, H. H., & Salim, R. (2025). Macroeconomic analysis of fuel subsidy reforms in ASEAN countries. In Energy Economics Finance and Management in Developing and Emerging Economies (pp. 95–113). Elsevier. https://doi.org/10.1016/B978-0-443-24728-6.00012-9