Full Cost Research Articles

Challenges and opportunities for conducting on-farm research

Availability of research farms owned by research institutions is declining due to their high operational cost, asset value, and limited distribution. The goals of this paper are to review their role and value in pastoral science and to identify challenges and opportunities for on-farm research. Research and commercial farms as trial sites may be mutually exclusive, complementary, or substitutes. Research farms are essential where science requires expensive facilities and/or rigorous control to maintain ethics and quality commitments. They can also provide information independent of scientific and commercial bias. Commercial farms provide access to more diversity, help scientists understand benefits and identify and resolve on-farm issues, and build industry credibility. Since the number of research farms is unlikely to increase, several lessons are important. Delivery, ethical, and science quality risks can accrue when the full cost of working with commercial farms is not considered or work most suited to a research farm is conducted in a commercial setting. Improved integration with farms owned by educational institutions; private trusts; regional and national government; and commercial companies offers opportunities for efficiency improvements. When working with commercial farmers, clear communication, flexible protocols, frequent oversight, and mutual respect are essential to maintain science quality. Paying farmers under a contractual agreement appears pragmatic. The value of opportunities to build farmer and researcher capability in the context of field experiments on research and commercial farms is identified.

Evaluasi Perhitungan Harga Pokok Produksi UMKM Beppa Desa Teluk Kabba Menggunaka Metode Full Costing

The purpose of this study is to calculate the cost of goods produced by Beppa MSMEs in Teluk Kabba Village, to calculate the selling price of Beppa in Beppa MSMEs in Teluk Kabba Village and to calculate the difference in calculating the cost of goods produced before and after the research in Beppa MSMEs in Teluk Kabba Village using the Full costing method. The data collection techniques used in this study were observation, interviews, and documentation. The collected data is analyzed through descriptive analysis. The results of this study show that there are differences in the calculation of the cost of goods produced by the company calculation with the full costing method. The cost of goods produced by Beppa uses the company's calculation of Rp. 802.6 and for the Full Costing method which is Rp. 811.3. The difference in calculation is IDR 8.7. This is influenced by the cost of raw materials, factory overhead costs both variable and fixed.

Strategi Penurunan Non Revenue Water (NRW) melalui Analisis Neraca Air dan Indikator Kinerja NRW pada Jaringan Distribusi SPAM Cabang Karawang

Perumdam Tirta Tarum as a BUMD with healthy performance and has FCR (Full Cost Recovery), but the NRW (Non Revenue Water) score is still quite high at 32.16%. The Karawang branch is the largest contributor to the volume of water loss, around 33% of the total water loss in 19 Branches/IKK units in other service areas. This study uses water balance analysis methods and NRW performance indicators to formulate recommendations for NRW reduction programs. Annual water loss during the period April 2022 to March 2023 was 23.96% with a loss volume of 2,343,756m3/12 months. The percentage of physical water loss is 18.49% and non-physical water loss is 5.47%. When converted to cost values, the annual loss of non-physical water is Rp.2,610,791,315.- and the annual loss of physical water is Rp.8,640,197,936.-. Physical loss is classified as category C performance (severe leakage) and the overall ATR performance indicator is classified as category C (poor ATR condition). Recommendations or strategies for handling NRW efficiently at study locations can be formulated after understanding the causes of NRW and the most influencing component factors.

The Cost to Consumers of Carbon Capture and Storage—A Product Value Chain Analysis

High-cost abatement measures to mitigate greenhouse gas emissions in the basic commodity industry is known to result in substantial increases in the production costs. Consequently, investments in such measures are lagging behind what is required to make deep emission cuts in line with the Paris Agreement. As high-cost abatement measures (such as Carbon Capture and Storage; CCS) are perceived as expensive for the basic commodity producer, this study investigates the impacts down-stream of the product value chain when assuming full cost pass-through (i.e., the cost increase related to basic commodity production is fully passed on down-stream of the product chain to the end-consumer). We investigate the effects on both costs, by means of a techno-economic assessment, and carbon footprints, using a Life Cycle Assessment (LCA), along the product value chain for the case of post-combustion CCS applied to the cement, pulp, Waste-to-Energy (WtE), and refinery industries, towards abating fossil- and process-related emissions and generating negative emissions. Here, we analyse the product value chains that involve cement to a high-speed railway, pulp to a disposable baby diaper, WtE in connection with housing and plastic products, and refineries to different transportation solutions (truck transport and air-freight). The results show that even though the costs for producing basic commodities can increase significantly (200% for cement, 75% for pulp, 230% for heat, and 6–37% for refinery products) when implementing CCS, the increases in prices for end-users are marginal (1% for the railway, 3% for the disposable baby diaper, 1% for the housing, 0.4% for truck transport and 2% for air-freight). Simultaneously, the carbon footprint associated with the end-use may be reduced by up to 36% for the railway, 31% for the diaper, 80% for the housing, and 3–23% for the refinery cases.

AVAILABILITY OF MEDICINES AS A RESULT OF REIMBURSEMENT MECHANISMS AND MEDICAL INSURANCE IS AN ISSUE FOR DISCUSSION

Availability of medicines, their quantity, quality, and appropriate documentation organization regarding distribution, storage, and sales – is one of the priority tasks of the healthcare system of each country. In European Union countries, a significant portion of expenditures for ensuring pharmaceutical supplies is covered by the state, implementing the principle of equal access of the population to effective medicines at an affordable price, which underlies the mechanisms of pricing and reimbursement. To achieve these goals, requirements are outlined in Directive 89/105/EEC of December 21, 1989, «On the transparency of measures regulating the pricing of medicinal products for human use and their inclusion in the system of national health insurance», aimed at promoting the development of the pharmaceutical industry both in the direction of developing expensive innovative drugs and in providing patients with quality generics. Thus, the main mechanism for ensuring the availability of medicinal products and medical devices for the population is the reimbursement program – the complete or partial refunding to entities engaged in retail trade of medicinal products, of the cost of medicinal products or medical devices dispensed to patients based on prescriptions, at the expense of the State Budget of Ukraine. The main objective of regulatory activities remains comprehensive regulation. Individual healthcare questions, including the provision of medicinal products, have been explored in the works of Yu. Bytiak, V. Kolpakov, R. Maidanyk, O. Myronets, I. Seniuta and others. The purpose of this publication is to review the normative and legal regulation of the reimbursement mechanism and practical implementation issues. Different countries establish their own reimbursement mechanisms, which vary in terms of funding sources, reimbursement conditions, price regulation methods, selection criteria for medicinal products, and key nosologies for treatment. The recipients of such systems may include socially vulnerable segments of the population, individuals suffering from severe or chronic illnesses, as well as various types of pharmaceutical assistance such as inpatient and outpatient care. Depending on the specifics of healthcare systems in different countries, different compensation mechanisms may be used. For example, this may involve the reimbursement of the cost of medicines for insured individuals, where the patient’s treatment expenses are covered by the insurance company or compensated to pharmacy establishments, with settlements being made between the insurance fund, healthcare facility, and pharmacy based on contracts. In Ukraine, in the absence of a mandatory medical insurance system, the reimbursement process operates in the form of the state program «Accessible Medicines», where the state compensates pharmacy establishments for the full or partial cost of medicines from the respective list.

Analisis Perhitungan Pokok Produksi dengan Menggunakan Metode Full Costing : Studi Kasus pada Apem Singkong Keju Pak Gede

The title of this research is "Micro, Small, and Medium Enterprises (MSMEs) Study: Apem Cassava Cheese by Mr. Gede. The research aims to 1) Determine the calculation of production costs using the Full Costing method in the MSME Apem Cassava Cheese by Mr. Gede, and 2) Assess the income of the MSME Apem Cassava Cheese by Mr. Gede. The objectives of this research are 1) To understand the calculation of production costs using the Full Costing method in the MSME Apem Cassava Cheese by Mr. Gede, and 2) To analyze the income generated by the MSME Apem Cassava Cheese by Mr. Gede. This research employs a qualitative method through interviews, observations, and documentation. All data are qualitatively analyzed in descriptive qualitative analysis. The informants in this study are the owner of Apem Cassava Cheese by Mr. Gede. The results of the research show that 1) The calculated production cost according to the company is Rp 1,060, with a production cost of Rp 42,382,000, which includes raw material costs, labor, packaging, and electricity. The selling price of the MSME's product has been traditionally set at Rp 1,500, resulting in a profit margin of 41.51% according to the MSME's estimation. 2) The highest sales in 2022 occurred in December with a total of 40,000 pieces and a net profit of Rp 17,618,000. The lowest sales were recorded in June with a total of 30,750 pieces and a net profit of Rp 11,654,639. The total sales in 2022 amounted to Rp 182,926,890, with an average monthly profit of Rp 15,488,983. The cost-plus pricing approach is used to determine the product's selling price, with a desired profit margin of 41.51%.

Taxing reproduction: the full transfer cost of rearing children in Europe.

What are the intergenerational resource transfer contributions of parents and non-parents in Europe? Using National Transfer Accounts and National Time Transfer Accounts for 12 countries around 2010, we go beyond public transfers (net taxes) to also value two statistically much less visible transfers in the family realm: of market goods and of unpaid household labour (time). Non-parents contribute almost exclusively to public transfers. But parents additionally provide still larger private transfers: mothers mainly time, fathers mainly market goods. Estimating transfer stocks over the working life, the average parental/non-parental contribution ratio in Europe flips from 0.73 (public transfers alone) to 2.66 (all three transfers combined). The highest combined parental/non-parental contribution ratios are in Sweden and Finland. The metaphorical tax rates implicitly imposed thereby on rearing children in Europe are multiples of the value-added tax rates in place on consumption goods. Unveiling the sheer magnitude of these invisible transfer asymmetries carries multiple implications for policy debates. For instance, it raises the question whether ageing European societies unwittingly tax, rather than subsidise, their own reproduction. Family friendly policy models, such as the Nordic welfare states, do not mitigate this effect. They help parents work, but do not lower the implicit tax parents pay.

FEATURES OF THE ORGANIZATION OF PRODUCTION AND SALES ACCOUNTING OF ORGANIC PRODUCTS IN BUSINESS STRUCTURES OF SMALL BUSINESSES

The purpose of the article is to study approaches to accounting and reporting of production and sales of organic products by business structures of small businesses for further unification, the possibility of determining real financial results and cost optimization. Based on the results of the research, the main problems of accounting and analytical support for the production and sale of organic products are determined, which are characterized by the organizational and technological features of the production process, the specifics of storage, the characteristics of sales channels, and the organizational features of the activities of small business entities on the market of organic products. For small business entities, the biggest problem remains low analytical accounting and reporting in terms of detailing the costs of production, logistics and sales of organic products, therefore the proposals are aimed at simplifying the mechanism of calculating its cost price, determining the full cost, forming the price, calculating the financial results, the possibility of cost management and real-time budgeting. Particular attention is paid to the accounting and reporting of costs for the implementation of the latest organic farming technologies (regenerative technology, IntraLight carbon farming), storage and packaging of organic products in order to further assess their payback. Since the promotion of one's own products and the search for sales channels, which determine the terms of sale, the structure and amount of circulation costs, are problematic in small businesses, ways of optimizing logistics and sales costs are proposed depending on the size of the farm, types of the commercial products, including exotic crops, and their production volumes. Attention is drawn to the need for the development of the so-called «organic logistics», optimization of the elements of sales costs in direct sales, which are preferable for small business agricultural producers of organic products.

CLIMATE CHANGE RISK DISCLOSURE AND ACCOUNTING CHOICE: EVIDENCE FROM U.S. OIL AND GAS COMPANIES

Focusing on U.S. oil and gas companies following the SEC’s investigation of ExxonMobil’s climate risk issues, this study investigates the impact of climate change risk (CCR) disclosure on corporate accounting choices. After examining U.S. oil and gas firms’ 10-K filings, carbon disclosure project (CDP) reports, and multi-source corporate sustainability reports, we find a positive association between CCR disclosure and the full cost (FC) accounting choice, designating that oil and gas firms with greater CCR disclosures are more likely to adopt the FC method to record oil and gas exploration activities. Our study responds to the SEC’s2010 and 2022 Climate Change Disclosure Guidance and encourages more oil and gas companies to disclose CCR and its impact on financial reporting to facilitate transparent transitions towards a low-carbon economy.

Cost comparisons and factors related to cost per stay in intensive care units in Belgium

BackgroundGiven the variability of intensive care unit (ICU) costs in different countries and the importance of this information for guiding clinicians to effective treatment and to the organisation of ICUs at the national level, it is of value to gather data on this topic for analysis at the national level in Belgium. The objectives of the study were to assess the total cost of ICUs and the factors that influence the cost of ICUs in hospitals in Belgium.MethodsThis was a retrospective cohort study using data collected from the ICUs of 17 Belgian hospitals from January 01 to December 31, 2018. A total of 18,235 adult ICU stays were included in the study. The data set was a compilation of inpatient information from analytical cost accounting of hospitals, medical discharge summaries, and length of stay data. The costs were evaluated as the expenses related to the management of hospital stays from the hospital’s point of view. The cost from the hospital perspective was calculated using a cost accounting analytical methodology in full costing. We used multivariate linear regression to evaluate factors associated with total ICU cost per stay. The ICU cost was log-transformed before regression and geometric mean ratios (GMRs) were estimated for each factor.ResultsThe proportion of ICU beds to ward beds was a median [p25-p75] of 4.7% [4.4–5.9]. The proportion of indirect costs to total costs in the ICU was 12.1% [11.4–13.3]. The cost of nurses represented 57.2% [55.4–62.2] of direct costs and this was 15.9% [12.0-18.2] of the cost of nurses in the whole hospital. The median cost per stay was €4,267 [2,050–9,658] and was €2,160 [1,545–3,221] per ICU day. The main factors associated with higher cost per stay in ICU were Charlson score, mechanical ventilation, ECMO, continuous hemofiltration, length of stay, readmission, ICU mortality, hospitalisation in an academic hospital, and diagnosis of coma/convulsions or intoxication.ConclusionsThis study demonstrated that, despite the small proportion of ICU beds in relation to all services, the ICU represented a significant cost to the hospital. In addition, this study confirms that nursing staff represent a significant proportion of the direct costs of the ICU. Finally, the total cost per stay was also important but highly variable depending on the medical factors identified in our results.

In search for ground rules for product-oriented full cost accounting methods: Ensuring construct validity

In search for ground rules for product-oriented full cost accounting methods: Ensuring construct validity

Feasibility analysis of rates of PDAM, South Halmahera district, North Maluku based on full cost recovery

This study aims to conduct an analysis of the feasibility of PDAM tariffs in South Halmahera Regency based on full cost recovery. In 2018, the average water tariff per m3 was IDR 3,046.41, or 53.67% of the essential cost of water per m3 of IDR 5,676.60. Whereas for 2019, the average water tariff per m3 is IDR 3,112.35, or 52.02% of the crucial cost of water per m3 of IDR 5,982.96. In 2018 and 2019, the selling price of water was still below the basic price of water, so the applicable average tariff did not fully cover costs (full cost recovery). This happened because it used the 2006 water tariff. PDAM Halmahera Selatan Regency has never proposed a new tariff policy. It has yet to evaluate its tariff policy every year because it focuses on its social role in serving the community's water supply and expanding service coverage. PDAM has also never received operational assistance subsidies from the South Halmahera Regency Government.
 Public interest statements
 This study proposes tariff changes that can cover total costs (full cost recovery) for the Regent of South Halmahera Regency. If the tariff proposal is not approved, the PDAM should seek operational assistance subsidies to cover the full costs from the South Halmahera Regency Government. If the two efforts are unsuccessful, the PDAM must carry out cost efficiencies to reduce the high operating expenses.

Understanding the Sustainability Reporting Landscape and Research Opportunities in Accounting

ABSTRACT I first distinguish the terms economic growth, economic development, and sustainable development. I then discuss the term ESG and why this term is used with respect to the corporation. I follow with a discussion of the shareholder primacy perspective and how this perspective plays a defining role in corporate law, corporate governance, and asset management. I argue that the shareholder primacy perspective is not appropriate for sustainability reporting because when a firm pollutes the environment, reduces biodiversity, or has inequitable social policies, it does not bear the full cost of its action; society and the planet does. Therefore, providing sustainability disclosures that are relevant to investors misses the point that sustainability disclosures are motivated by the desire of other stakeholders to learn about externalities. I discuss the different standard setters in the sustainability space and how accounting and measurement play key roles. I close with a discussion of research opportunities. Data Availability: Data are publicly available from sources indicated in the text. JEL Classifications: K22; L21; M41; M48; Q56; Q58.

Electricity pricing challenges in future renewables-dominant power systems

Economy-wide decarbonization will require electric power systems to rely heavily on variable renewable energy (VRE, mainly wind and solar generation), which has near zero marginal operating costs, and energy storage. We have modeled optimized, deeply decarbonized power systems in three US regions at mid-century under a wide range of plausible cost and technology assumptions. The shadow marginal values of energy (MVEs) from these optimizations approximate the wholesale spot prices of energy in simplified hypothetical competitive energy-only wholesale markets in which revenues earned by selling energy in wholesale electricity markets should be sufficient to cover all capital and operating costs. A very robust result is that under carbon constraints, very low MVEs occur much more frequently than in today's wholesale markets, and very high prices are also more frequent than today. Revenues from a relatively small number of high MVE periods are required to fully cover VRE capital and operating costs, while storage charges and discharges in many hours. In an ideal, efficient regime, a competitive energy-only wholesale market without price caps would minimize total system costs, and retail rates equal to wholesale spot prices would fully cover those costs and induce efficient demand behavior. Real power systems depart significantly from this ideal: price caps are used frequently in wholesale markets, capacity payments from organized capacity markets or bilateral contracts are relied on to supplement energy market revenues to enable full cost recovery, and most customers face retail rates that do not reflect variations in marginal operating costs. The greater volatility of future decarbonized wholesale markets will increase the costs of such politically attractive departures from the ideal regime.

Redefining the degree of industry greenness using input–output tables

Climate risk is a novel exposure that may rock the financial stability world-wide. For this reason the world banking regulation standards-setter – the Basel Committee on Banking Supervision (BCBS) – suggested considering pricing in the climate risk and adopting its relevant regulation. It listed input–output tables as one of the key tools to measure the climate riskiness of a borrower. However, most of the prior research considered carbon dioxide emissions when applying input–output tables. Same time there is a significant volume of research focusing on climate (or environmental) risk ratings. Nevertheless, both approaches might present only part of the larger climate-related financial risk implications. That is why, our research purpose is to develop full climate risk estimate by leveraging on the input–output tables and climate risk ratings. By doing so, we intend to demonstrate when the existing approaches yield sufficient information to make financial risk-related decision and when those should be improved by considering full climate risk justified in the current paper. The novelty of this work is the amalgamation of a known data source on environmental (climate) risk scores from Sustainalytics.com with the world input–output database (WIOD) for 2000–2014. The major finding of ours is that the greenness of industries is materially perturbed when considering WIOD-based full climate risk estimates as follows from an equivalent to the Leontief full production costs. We specifically find that aluminium as a commodity occurs much’browner’ from full climate risk perspective, than it seems from the marginal climate risk one. Hence, the steps taken by Australia to reduce aluminium production are necessary, but not sufficient. For the global welfare China has adopt a negative emission target (i.e., reduce more carbon dioxide, than is produced) to attain the objective of noticeable improvement in the global carbon footprint, particularly the one related to aluminium production. Our results are solicited by the Central Banks to accurately design the specialized lending facilities to truly green industries and projects.

Report of the ILAE SUDEP Task Force on national recommendations and practices around the world regarding the use of wearable seizure detection devices: Aglobal survey.

Wearable seizure detection devices have the potential to address unmet needs of people with epilepsy. A recently published evidence-based international guideline recommends using such devices for safety indications in patients with tonic-clonic seizures (TCS). Our objective was to map existing guidelines and clinical practices at national level. We conducted a survey of the International League Against Epilepsy (ILAE) chapters regarding national recommendations and practical circumstances for prescribing seizure detection devices, and another survey of physicians in the ILAE constituency anywhere in the world, concerning their views and practices regarding recommendations for and prescription of such devices. Fifty-eight ILAE chapters (response rate 48%) and 157 physicians completed the surveys. More than two-thirds of responding countries do not have standards on wearables for seizure detection, although they indicated availability of such devices. The most often recognized indications were safety and objective seizure quantification. In nearly half of countries, devices are purchased by patients or caregivers, and either lack a uniform reimbursement scheme (41%) or patients pay the full cost for the device (48%). Tonic-clonic seizure frequency, nocturnal seizures, and previous injuries were the main factors that influenced the surveyed physicians to recommend wearable seizure detection devices. Our results document the need to implement international clinical practice guidelines at national level and to consider these when deciding upon reimbursement of seizure detection devices.

Nutrition and Diet Apps: Brazilian Panorama before and during the COVID-19 Pandemic.

To describe the characteristics of nutrition and diet apps before and after the COVID-19 pandemic available in Brazil. Nutrition and diet apps were identified using the official Apple and Google stores. The search occurred in January 2020 and May 2022 in Brazil. We extracted the nutritional content and standard indicators (e.g., being developed before or after 2020, number of languages, target population, investment, prices, seller, number of reviews and downloads, consumer rating). 280 apps were launched before and 411 during the COVID-19 period. Most apps were available in at least ten languages (96.6%), with no indication of age (95.6%) or partial or full cost (59%). As for the contents, 18.9% addressed personal diet suggestions; 73.4%, nutritional education; 48.8%, revenues; 35.9%, physical activity with a nutritional guide; 2.3%, nutritional recommendation for eating out; 23.9%, grocery shopping with a scan code; 32.4%, food diary; 18.9%, water intake; and 4.6%, nutrition/diseases. The data show an evolution that may have been boosted by the pandemic and that reveals a trend towards the development of apps with educational content. During the pandemic, there was a positive qualitative and quantitative movement in e-health regarding the promotion of education.

Costs of syringe vending machines in Tbilisi, Georgia

BackgroundSyringe vending machines (SVM) can improve access to sterile injecting equipment, but they have not been widely implemented or evaluated. We evaluate the cost of SVM installed between July 2019–December 2020 in Tbilisi, Georgia.MethodsThe SVM were stocked with several kit types, including injecting equipment for opioid or stimulant users, naloxone, male and female condoms, and pregnancy tests. We gathered financial data from the project to estimate fixed (staff time, start-up costs, equipment, running costs, and consumables) and variable (harm reduction kits) costs. We calculated the full cost of the SVM intervention, cost per user, cost per additional syringe accessed by SVM users, and cost per kit distributed (2020 Euros).ResultsSVM access cards were issued to 1132 users, and 29,238 kits were distributed through SVM, total cost €204,358. Staff costs were 51% of total, consumable costs 28%, equipment 10%, and start up, recurrent costs, and overheads 5% or less each. Opioid and stimulant kits were most accessed (35% and 32% of total). Cost per user was €66/year, and cost per transaction €7, of which €5 fixed costs and €2 variable. If monthly transactions increased from the average of 1622/month to highest monthly usage (4714), fixed costs per transaction would decrease to < €1. It cost €0.55 per additional syringe accessed/user/month.ConclusionsThis study provides evidence for governments about the cost of SVM, a novel harm reduction intervention. This is particularly relevant where Global Fund is withdrawing and harm reduction services need to be incorporated into national budgets.

Understanding Policy Decisions and Their Implications Regarding Preventive Interventions for Respiratory Syncytial Virus (RSV) Infection in Canadian Infants: A Primer for Nurses.

Respiratory syncytial virus (RSV) is a leading cause of morbidity and hospitalization in young children, and prevention is the primary management strategy. At present, palivizumab, a monoclonal antibody providing immediate passive immunity, rather than a vaccine that induces active immunity, is the only preventive intervention used in routine practice internationally. In Canada, access varies across the country. Prophylaxis policies are mainly driven by cost-effectiveness analyses, and it is crucial that the full costs and benefits of any intervention are captured. Positive results from a new Canadian cost-effectiveness analysis of palivizumab will help address the current inequality in use while providing a framework for future models of RSV preventives. Nurses are the principal educators for parents about the risks of childhood RSV and optimal prevention via basic hygiene, behavioral and environmental measures, and seasonal prophylaxis. Nurses should be provided not only with regular, up-to-date, and accurate information on RSV and the clinical aspects of emerging interventions but be informed on the decision-making governing the use of preventive strategies.

On the welfare effect of retail electricity subsidy in Vietnam

PurposeThis research investigates how subsidy programs in Vietnam's residential electricity market affect consumers' well-being.Design/methodology/approachTwo perspectives are employed: cash transfer and quantity-based subsidy. The effectiveness of cash transfer is measured in three ways: benefit incidence, beneficiary incidence and materiality. The quantity-based subsidy is established under the increasing block rate pricing, with the first two block rates being lower than the marginal cost. To improve the quantity-based subsidy, the research examines the consumer surplus under four proposals.FindingsThe results show that both types of subsidies are ineffective in supporting the poor.Research limitations/implicationsIn order to achieve a more equal distribution among households, the subsidy program should remove all subsidized blocks and reflect the full marginal cost. Changes should be made to the price structure regarding both marginal price and intervals.Practical implicationsTo mitigate the impact of the quantity-based subsidy, the government should improve the cash transfer by reducing extortion and improving targeting efficiency, especially for poor households living in rented houses.Originality/valueThis paper is the first to discuss the welfare effect of the electricity subsidy in Vietnam. First, it comprehensively evaluates the cash transfer subsidy in Vietnam. Second, it suggests a modification in the residential electricity tariff.