Morningside Campus Status Updates

Current Access Level “I” – ID Only: CUID holders, alumni, and approved guests only

Energy Explained

Get the latest as our experts share their insights on global energy policy.

Podcasts

Hear in-depth conversations with the world’s top energy and climate leaders from government, business, academia, and civil society.

Events

Find out more about our upcoming and past events.

Energy for Development

Fuel subsidy reform and the social contract in Nigeria: A micro-economic analysis

External Publications with Tom Moerenhout • July 19, 2021

Read the Article Abstract Fuel subsidies in Nigeria are enormous – around USD 3.9 billion...

Read the Article

Abstract

Fuel subsidies in Nigeria are enormous – around USD 3.9 billion – almost double the health budget. Such subsidies come at great cost: the opportunity costs of such spending on other development objectives are large; the distribution of resources to the state governments is reduced; the vast majority of the subsidy goes to better off Nigerians; and cheaper petrol encourages greater pollution, congestion and climate change. Despite this, most Nigerians oppose the reduction of subsidies. We draw on a new nationally representative household survey that asked Nigerian men and women about their knowledge and attitudes towards subsidies. We construct and test a set of hypotheses about the factors associated with support for subsidy reform. We find that those who pay more or who experience less availability of fuel tend to support reform more. On the other hand, people who believe the Government is corrupt or lacks the capacity to implement compensation programs appear strongly opposed to reform. Finally, being religious and the delivery of reasonable national and local services also improves the acceptance of reform. These results support the idea that building a social contract is key to reform success.

Our Work

Relevant
Publications

Energy and Climate Issues During the Trump Administration’s First 100 Days

President Donald Trump has made energy a clear focus for his second term in the White House. Having campaigned on an “America First” platform that highlighted domestic fossil-fuel growth, the reversal of climate policies and clean energy incentives advanced by the Biden administration, and substantial tariffs on key US trading partners, he declared an “energy emergency” on his first day in office.

Energy and Climate Issues During the Trump Administration’s First 100 Days
See All Work
Energy for Development

Fuel subsidy reform and the social contract in Nigeria: A micro-economic analysis

External Publications with Tom Moerenhout • July 19, 2021