Energy Subsidy Reform in Iran

Djavad Salehi-Isfahani

Chapter 6 in The Middle East Economies in Times of Transition, 2016, pp 186-195 from Palgrave Macmillan

Abstract: Abstract On December 19, 2010, Iran embarked on an ambitious reform of its extensive subsidies. Energy prices that had been kept well below international levels for decades were raised by a factor of 3 to 9 and bread prices were doubled. Energy price reform had been discussed for at least a decade, and the specific plan for this particular reform program was announced by president Ahmadinejad in 2008 and enacted into law in January 2010. This attempt at reform ended a huge government subsidy, estimated at upwards of $70 billion per year, or nearly $1000 per person per year. It was distributed highly unequally and caused Iran’s productive sectors to become the least efficient in the world (Guillaume et al 2011, IEA 2010, Salehi-Isfahani et al 2012).

Keywords: Energy Price; Purchasing Power Parity; Cash Transfer; Headcount Ratio; Energy Subsidy (search for similar items in EconPapers)
Date: 2016
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DOI: 10.1007/978-1-137-52977-0_7

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