Price Subsidies Research Articles

Public Financing in Higher Education Institutions: Issues and Challenges

This paper is an attempt to analyze the present pattern of funding higher education in Nepal and to discuss the desirability and feasibility of various alternative methods of funding the same. Before federal system, higher education (HE) in Nepal was a state funded but currently the paradigm has been shifted to the province government besides the funding of central university, which has not been well-defined. Higher education itself benefits not only society at large, but also individuals, and as it attracts relatively more privileged sections of the society, there is a rational for shifting the financial burden to the social domain rather to government sector alone.
 The main objective is to review the current policies, practices of financing in promoting access, quality, relevancy, equity and prosperity. On the basis of secondary sources of data this paper focused the reports published by University Grants Commission, Nepal (UGC). Some other relevant literature, reports, articles, books, policy documents were critically analyzed and reviewed to draw the findings and conclusion. Some statistical methods were used for interpretation.
 Resource constraints, equity, financing HE mostly from the general tax revenue may not be a desirable policy in the long run. Accordingly some of the alternative policy choices are discussed for financing HE from the public exchequer, student loans, student fees, and the role of the community investment. Among the available alternatives, it is argued that a discriminatory pricing mechanism and subsidy policies to community campuses of different layers of government would be relatively more efficient and equitable mechanism of financing as community campuses are providing the major access, equity, quality as well and reducing the financial burden of government with the cost recovery modality.
 It is argued that such institutions should be the priority of government for promoting equitable quality access to HE with nominal costs of users.

The Impact of Price Subsidy on Rice Self-Sufficiency Level in Malaysia: A System Dynamics Approach

The Malaysian government had targeted for the rice industry in the country to achieve 100% rice self-sufficiency where Malaysia’s rice self-sufficiency level (SSL) is currently at 65% to 75%. Thus, the government had implemented few policies to increase the rice production in Malaysia to meet the growing demand of rice. This paper focus on analyzing the impact of price subsidy on the rice production system in Malaysia using a system dynamics modelling approach. Scenario analysis was conducted using the developed system dynamics model by making changes on the price subsidy and observe the impact of the changes on the rice production and rice SSL. The developed system dynamics model offers better understanding of the effect of price subsidy on the rice self-sufficiency level. Based on the scenario analysis, the result shows that a 50% increase in the price subsidy leads to a substantial increase in demand as the rice price drops. Accordingly, the local production increases by 15%. However, the SSL slightly decreases as the local production is insufficient to meet the large demand.

Does renewable energy policy work? Evidence from a panel data analysis

This paper develops a fixed effect model to evaluate the effect of renewable energy policy using a panel dataset covering 29 countries during the period of 2000–2015. The renewable energy policy system in this paper includes seven aggregate policies and twelve specific ones. The empirical results indicate that four of seven aggregate policies, including fiscal and financial incentives, market-based instruments, policy support, and research, development and deployment, are demonstrated to be significant to the improvement of renewable energy capacity. Meanwhile, three of twelve specific policies, including price policy, grants and subsidies, and strategic planning, have positive effects on renewable energy development. This paper assesses the aggregate and specific policies in the same analysis framework, and the empirical results determined that synergy effects existed among specific policies. The empirical results also indicate that the implementation of the Kyoto Protocol in 2005 has had positive impacts on renewable energy development in typical countries.

Assessment of geographical distribution of photovoltaic generation in China for a low carbon electricity transition

Solar power is considered as one of the most promising low-carbon alternatives to fossil fuels for future electricity systems. The historical diffusion pattern of solar power in China is consistent with other energy generation approaches, which emphasizes the function of energy supply. Given that the electricity system in China is experiencing a low-carbon transition, the new installed capacity should be located in regions with an urgent need for carbon reduction, as well as good life-cycle performance. Therefore, indicators of carbon dioxide emissions and the carbon intensity of electricity consumption are employed to analyze the provincial demand for renewable power. Additionally, the life-cycle performance of solar power is assessed, grounded in the concepts of energy return on energy and carbon investments. On this basis, a comprehensive ranking of the provinces of China is provided. By considering carbon intensity as an indicator to assess the lifecycle performance of solar power, the results show that the distributed photovoltaics are suitable for installation in Shandong (1.06) and Jiangsu (0.98), which basically match the current layout, while some adjustments to the future distribution of centralized photovoltaic systems in China should be made, where Qinghai (0.45) and Ningxia (0.58) are not suitable as possible locations for newly installed capacity. Some policy implications for the future empowerment of photovoltaic generation in China are provided, including adequate life-cycle assessment, carbon pricing and financial subsidy.

Mistargeting and Regressive Take Up of the Indonesian Rice Subsidy Program

We evaluate household participation in the Indonesian Raskin program, a national rice price subsidy program for the poor. Using a household panel from the 2000 and 2007 rounds of the Indonesian Family Life Survey (IFLS), we evaluate program participation over the duration of the year prior to the 2007 survey using four different measures of participation. We find that although the poor as a whole are likely to have higher levels of participation compared to the non‐poor, program participation is regressive among the poor. The poorest households are less likely to purchase Raskin rice over the course of a year, and, conditional on participation, they are likely to purchase lower quantities of rice, they purchase rice with lower frequency and they have lower participation relative to the number of community distributions. We also find that this regressive participation among the poorest households is more severe in urban areas.

Price Subsidy Policy in Brazilian Agriculture:

The present article aims to indicate the peculiarities and contradictions found in the price subsidy policies in Brazilian agriculture in the last decade. Despite State efforts carried out through the Minimum Prices Guarantee Policy (PGPM, in the original Portuguese), they have not been a good alternative for several producers. The Austrian School interpretation indicates that the information is not available in a homogenous way to economic agents and price interventions regarding the grant of subsidies, it bears unrevealed costs that raise the information asymmetry of the candidates for the minimum price policy, being unable to reach its objective of reducing such market information asymmetry.

Increasing the efficiency of rice agribusiness through the recommendations of balanced fertilizers and price policies

The efforts in increasing national rice production through production efficiency and price efficiency more important alternative than having extensification through the extension of the area. This study was purposed in leveling the national rice agribusiness economic efficiency by comparing between before and after the subsidy price was calculated based on the conditions of irrigated rice farming technology in Java in 2010 and in 2014. The results of the analysis rice farming nation efficiency 85% was increased to be 88% on fertilizer subsidies had been taken into account. The rice farming efficiency in year 2014 was 71% to be 84% at the subsidies price calculated. National technical efficiency of lowland rice production can still be increased in improving production technology through the application of balanced in use of NPK, KCl, and organic fertilizer recommendation. In 2014 conditionally shown the economic efficiency on farm level 38%, was smaller than national level 65%, the grain was sold by the government purchase price, using technology, and only looks up to 48% efficiency after fertilizer subsidy prices had been taken into account. Overall the agribusiness efficiency of wetland rice trends to increase above 50% at milling has the price as the retail price at the farm level. It was suggested that technical efficiency on production should increased technology in application of fertilizer on rice farming in Java.

Food Price Subsidy and its Effects on Poverty in Khyber Pakhtunkhwa, Pakistan

Food Price Subsidy and its Effects on Poverty in Khyber Pakhtunkhwa, Pakistan

Food Price Subsidy and its Effects on Poverty in Khyber Pakhtunkhwa, Pakistan

We estimate the effect of food price subsidy on poverty in Khyber Pakhtunkhwa, Pakistan in this paper. The study uses Linear Approximate Almost Ideal Demand System for the estimation of compensated and uncompensated price and expenditure elasticities of food using Household Integrated Economic Survey. The estimated own and cross price Hicksian elasticities are used for estimating the changes in the quantity of food consumed, expenditure on food and its effect on poverty. The study uses two recent available poverty lines for estimation, showing that the scheme of food price subsidy increase real income of the households which has a decreased poverty state. The analysis shows that the subsidy program marginally decreases poverty in the province. The study recommends targeted food price subsidy for poverty alleviation and eradicating chronic hunger.

Impacts of carbon pricing and renewable electricity subsidy on direct cost of electricity generation: A case study of China's provincial power sector

The power sector contributes 40% of the carbon emission in China, so decreasing the carbon intensity of the power sector is crucial for China to achieve the mitigation target contained in its Nationally Determined Contribution (NDC). Renewable electricity subsidy and carbon pricing are two commonly used mitigation policy instruments in the power sector, but their implementation costs are different. In this article, the Regional Generation Cost Evaluation Model (RGCEM), which is based on an electrical engineering model, Unit Commitment Model, is developed to analyze the emission reduction potential, implementation cost as well as the potential impact on the direct cost of electricity generation of both of the above mentioned policy instruments. Actual power generator data and a typical daily load curve of Guangdong Province, China are used to demonstrate the possible impacts of implementing renewable electricity subsidy and carbon pricing policies. The analysis shows that the emission reduction achieved by carbon price increase of 9.5–11.6 Yuan RMB/tCO2 is the same as that achieved by 1% increase of share of renewable electricity in the total electricity generation. The stricter the carbon intensity reduction target is, the higher carbon price increases are needed for substituting 1% increase of share of renewable electricity to achieve the same mitigation. The adjustment of mitigation policy portfolio will change the corresponding implementation costs of achieving the specific emission reduction target. It shall however be noted that the spillover effects of renewable electricity subsidy and carbon pricing are different, so implementation cost should not be the sole determinant for choosing mitigation policy instrument in the power sector.

The energy transition history of fuelwood replacement for liquefied petroleum gas in Brazilian households from 1920 to 2016

In Brazil, there are almost ten million people relying on traditional use of biomass for cooking, which correspond to about five percent of the country's population. The vast majority lives in poor municipalities away from urban centers. The replacement of fuelwood for LPG is the result of an intense urbanization process and governmental intervention based on price regulation and subsidies. In 2015, the energy demand for cooking in the Brazilian households was 46 TJ, LPG covered 51% of the demand and the remaining 49% relied on fuelwood to supply the demand for energy. This study shows that there are enormous variations in the level of consumption and the types of fuels used due to the regional complexity of Brazil. In addition, it also shows the transition from fuelwood for cooking to modern fuels such as LPG does follow a consistent pattern in Brazil. Decisions related to energy consumption and fuel type are strongly influenced by accessibility, affordability and the convenience of the fuel.

The impact of donation subsidy of remanufactured products on Manufacturer's pricing-production decisions and performances

Realization of value of remanufactured products through social donations is evident in practice. Many companies donate products to meet their corporate social responsibilities, reduce pressure on government resources and improve social welfare. Donation behavior has a positive impact and is supported by government's subsidy incentive. This paper introduces donation subsidy for remanufactured products and formulates a two-period dynamic model to investigate the impact of donation subsidy on production and pricing decisions. We explore whether and under what conditions introducing subsidy policy improves the environmental performance, whilst increasing the economic performance. The results showed that the remanufactured products only for sale is a special example of the remanufactured products available for both sale and donation, namely, donations of remanufactured products are absent when government subsidy incentive is invalid. Donation subsidy increases the second-period quantity of new products and donation quantity of remanufactured products and decreases sale quantity of remanufactured products. A sufficiently high subsidy increases the first-period quantity of new products. Overall, introducing donation subsidy of remanufactured products expands the demand for both the new and remanufactured products and leads to the premium effect of remanufactured products. When the cost of new products is low, introducing donation subsidy for remanufactured products is an economic and environmental “win-win” strategy. When the cost of new products is moderate, the government can adjust the subsidy price to achieve the desired economic and environmental performances. The above two situations exist a unique optimal subsidy price which improves the manufacturer's profit and achieves the best environment. For the high-cost products, the improvement of economic profit is at the expense of environment.

Dampak Kebijakan Perberasan pada Pasar Beras dan Kesejahteraan Produsen dan Konsumen Beras di Indonesia

Rice demand in Indonesia increases every year so it makes the big gap between production and consumption of rice. Excess demand is covered by rice import which causes domestic rice price responds the global rice price movements that harm both producers and consumers. So, the policy instruments that could reduce dependence on rice import and can provide benefits to producers and consumers of rice is very needed. The objectives of this study were to analyze the impact of rice policy on rice market and the welfare of rice producers and consumers. This study uses annual time series data and simultaneous equations model with two stages least squares method. The analysis showed that rice policy changes can influence condition of Indonesia’s rice market and that the increase in Government Purchase Price (HPP), agricultural credit, and fertilizer subsidy can improve the welfare of the producers and consumers.

Research progress on cost accounting of home care in China

This paper reviewed the research progress on home care cost accounting in China mainly including the relevant concepts, main contents, common methods and existing problems of home care cost accounting as well as its further expectation. This paper pointed out that the methods and model study of home care cost accounting were insufficient, nurses were deficient in the sense, fee scale and policy subsidy mechanism was incomplete. We should build an innovative home care cost accounting model, raise nurses' awareness of cost control, reasonably state home care service price and perfect policy subsidy mechanism so as to promote home care cost control to be scientific, standardized and systemic. Key words: Review; Home care; Nursing cost; Cost accounting

The economic effects of renewable energy expansion in the electricity sector: A CGE analysis for Malaysia

Electricity is a critical factor in developing a robust and modern economy and for improving the quality of life. In Malaysia, the electricity sector benefits from heavy subsidies to its gas inputs. Such economic interventions disrupt price mechanisms and result in inefficient resource allocations, over-consumption of electricity, CO2 emissions, and government budget deficits. Under the Tenth Malaysia Plan price controls and subsidies have been rationalized to achieve complete market pricing. In addition, in consideration of climate change issues, environmental concerns, and strengthening energy supply security through diversification, the government encourages the use of renewable energy for electricity production through the Feed-in-Tariff (FiT) strategy. This study employs a Computable General Equilibrium (CGE) model to examine the potential impacts of gas subsidy reform in the power sector and on the Malaysian economy. The model evaluates and compares the impacts of two methods of providing funds for encouraging the development of renewable energy production, reallocating revenues from gas subsidy removal, and remunerating the FiT mechanism. The simulation results show that reducing gas subsidies without recycling the revenues gained decreases electricity demand and emissions significantly while having only minimal negative effects on macroeconomic variables. The results indicate that utilizing a recycling plan in which additional revenues from subsidy reforms are re-allocated to finance the FiT framework contributes significantly to the production of renewable energies within the power generation sector in Malaysia.

Optimal monetary policy in the presence of food price subsidies

Food price subsidies are a prevalent means by which fiscal authorities may counteract food price volatility in middle-income countries (MIC). We develop a DSGE model for a MIC that captures this key channel of a policy induced price smoothing mechanism that is different to, yet in parallel with, the classic Calvo price stickiness approach, which can have consequential effects for monetary policy. We then use the model to address how the joint fiscal and monetary policy responds to an increase in inflation driven by a food price shock can affect welfare. We show that, in the presence of credit constrained households and households with a significant share of food expenditures, a coordinated reaction of fiscal and monetary policies via subsidized price targeting can improve aggregate welfare. Subsidies smooth prices and consumption, especially for credit constrained households, which can consequently result in an interest rate reaction less intensely with subsidized price targeting compared with headline price targeting.

A Research on the Affecting Factors of Farmers’ Comprehensive Utilization of Straw in China

Based on the data from the field research of 1038 households from 17 cities in 7 provinces, the author analyzes the current situation of comprehensive utilization of straw and then uses ordered Probit Model to research the factors that affecting the farmers’ comprehensive utilization of straw. The survey attests that nowadays the degree of comprehensive utilization of straw is low, because 53.72% straw isn’t used in any forms. The farmers’ utilization of straw is apparently in direct proportion to the area they have planted, to the situation of whether farmers have ever engaged in livestock breeding, to the degree of farmers’ cognition of its harm, to the situation of whether they have received price subsidies. However, it is in inverse proportion to the share of non-agricultural earnings in farm families’ gross income, the ages and education background of heads of households. It can be inferred that the inadequate agricultural work force, the high opportunity cost of utilization, the small farming scale and the deficient governmental function can serve as the major reasons for the low degree of comprehensive utilization of straw.

Optimal Price Subsidy for Universal Internet Service Provision

Universal service has been adopted by many countries to bridge the digital divide between Information and communication technologies (ICTs) “haves” and “have-nots”. The key goal of universal service is to provide telecommunications services to “needy persons” at “reasonable” rate. It is, therefore, critical for policymakers to make decisions on what is a “reasonable” price or subsidy for “needy persons” so that the targeted users do utilize ICTs and benefit from them. This paper analyzes universal service subsidies in providing subsidized Internet access from a pricing point of view through a hypothetical scenario where the subsidized users being subsidized through a price subsidy and non-subsidized users share the same network operated by a service provider. We propose a service differentiation system based on priority queuing to accommodate both groups of users, and model such a system as a Stackelberg game from both a revenue-maximizing service provider perspective and a social welfare maximizing planner’s perspective. We then analyze the optimal prices that maximize the service provider’s revenue and social welfare respectively, investigate how the revenue maximizing price and social welfare maximizing price are effected by users’ willingness to pay and the subsidy ratio, and evaluate the revenue maximizing solution on welfare grounds using the social-maximizing solution as a benchmark. Interestingly, the optimal revenue maximizing solution corresponds to the socially optimal solution in terms of social welfare under the optimum subsidy ratio that maximizes the social welfare. This suggests that the subsidy ratio can be used as a tool to induce the revenue maximizing service provider to set a price that leads to social optimality.

Integrated economic and environmental analysis of agricultural straw reuse in edible fungi industry.

BackgroundChina currently faces severe environmental pollution caused by burning agricultural straw; thus, resource utilization of these straws has become an urgent policy and practical objective for the Chinese government.MethodsThis study develops a bio-economic model, namely, “straw resource utilization for fungi in China (SRUFIC),” on the basis of a field survey of an edible fungi plant in Zhejiang, China, to investigate an integrated economic and environmental performance of straw reuse in fungi production. Five scenarios, which cover changes in the production scale, wage level, and price fluctuations of the main product and inputs, are simulated.ResultsResults reveal that (1) the pilot plant potentially provides enhanced economic benefits and disposes added agricultural residues by adjusting its production strategy; (2) the economic performance is most sensitive to fungi price fluctuations, whereas the environmental performance is more sensitive to production scale and price of fungi than other factors; (3) expanding the production scale can be the most efficient means of improving the performance of a plant economically and environmentally.DiscussionOverall, agricultural straw reuse in the edible fungi industry can not only reduce the environmental risk derived from burning abandoned straws but also introduce economic benefits. Thus, the straw reuse in the fungi industry should be practiced in China, and specific economic incentive policies, such as price support or subsidies, must be implemented to promote the utilization of agricultural straws in the fungi industry.

Economic co-optimization of oil recovery and CO2 sequestration

Drawing on techniques from both petroleum engineering and economics, we analyze how oil fields that use CO2injection to enhance oil recovery are likely to respond to CO2 storage incentives by “co-optimizing” oil recovery and CO2 sequestration. We focus specifically on predicting the CO2-injection path that co-optimizing operators will choose, and on how sensitive this path and the cumulative oil production and CO2 sequestration resulting from it are to variation in the oil price and CO2 subsidy. A study by Leach et al. (2011), which to date is the only rigorous economic study of co-optimization, addresses these questions using an ad hoc reservoir model. Our study applies Leach et al.’s analysis to dynamic reservoir-simulation models of two different oil fields. We find that, even though Leach et al.’s assumptions about how a reservoir responds to CO2injection are quite far off the mark quantitatively, their main findings hold up remarkably well qualitatively.