Energy prices subsidy in the world economy: Facts and aspirations

Abstract

Many oil exporter countries choose to subsidy energy prices to maximize the benefits of low income countries, but the problem is that this subsidy policy in the fact is in the benefit of all groups in the society both high income group and low income group. Further, this kind of policy lead to different costs in the economy that affect negatively the development of economic activity. These effects suggest that the policy makers should go to reform this kind of subsidy policy and hence improve the economic efficiency and incentives in economic activity. But the reform process faces many barries that make the process so difficult and put many challenges for policymakers.