Reforming Fossil Fuel Subsidies with Citizens' Approval: The Case of Colombia

Charlotte Sophia Bez, Jorge A. Bonilla, Brigitte Castañeda Rodríguez, Jorge H. García, Leonard Missbach, Farah Mohammadzadeh Valencia and Jan Steckel

No 12583, CESifo Working Paper Series from CESifo

Abstract: Subsidizing fossil fuel consumption is at odds with climate change mitigation and a heavy burden on public budgets. Yet, efforts to reform such subsidies often face strong public opposition. We examine whether informing citizens about the effects of fossil fuel subsidy reform (FFSR) and complementary policy measures can increase public acceptance. We study this question using a novel survey experiment in Colombia, a country currently aiming at reforming existing fossil fuel subsidies. Building on Hoy et al (2026), our experiment exposes respondents to different information treatments, including from an innovative calculation of personal costs, and options for complementary policy measures. Leveraging a representative sample with more than 3,600 respondents, we find that information provision alone has limited effects on public support, as citizens rarely update their - at times - incorrect beliefs. In contrast, policy design is crucial. Complementing FFSR with additional measures shifts public opinion from majority opposition to majority support. Informing about the environmental effects of FFSR is most effective and strongly increases support for environmentally oriented complementary policies. Opposition to FFSR without complementary measures remains primarily driven by concerns about impacts on poorer households.

Keywords: political economy; public finance; subsidies; climate change; fossil fuels; energy policy; survey experiment; distributional impacts (search for similar items in EconPapers)
JEL-codes: D63 H20 H22 H23 P16 (search for similar items in EconPapers)
Date: 2026
New Economics Papers: this item is included in nep-dev, nep-ene, nep-env and nep-exp
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