Thesis Title:
The impact of fossil fuel subsidy reforms in Indonesia on health financing and health outcomes
Thesis Abstract:
Fossil fuel subsidies – which incentivise the use of coal, oil, and gas as dominant energy sources by making their prices artificially low – are highly fiscally draining and carry deleterious impacts for the environment, health, and distributional outcomes. However, there are often political economy constraints which hinder attempts to reduce or remove such subsidies. While cutting fossil fuel subsidies can increase the cost of living and exacerbate poverty, such reform also provides a unique opportunity to free public resources to reinvest into health and social protection programs, which can mitigate the negative impacts on vulnerable populations.
In Indonesia, where large fossil fuel subsidy cuts were made in 2005, 2008, 2014/15 and 2022, part of the realised savings were redirected to expand social protection and health coverage for vulnerable groups. However, there is limited evidence on the health benefits or challenges for vulnerable populations resulting from those subsidy cuts. This project aims to use quasi-experimental methods to evaluate the success of such reforms in terms of health, environmental, and socio-economic outcomes. Moreover, the insights derived from this research will be used to inform policymakers on the optimal approach to fossil fuel subsidy reform (both in Indonesia and more broadly) to achieve sustainable development objectives in a timely and equitable manner.
Primary Supervisor:
Dr Judite Gonçalves