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The Social Cost of Thailand's Transportation Fuel Pricing Policy

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  • Wichsinee Wibulpolprasert
  • Bhawin Teveyanun

Abstract

The price structure of Thailand's transportation fuels has always been heavily distorted by the government. The prices of diesel and biofuels are consistently subsidized, while the prices of other fuels are raised above their competitive level in order to provide cross-subsidies to diesel and biofuels. Price distortion in this fashion leads to over-/under-consumption of transportation fuels relative to the socially optimal level. This study estimates the economic and social cost of the price distortions within Thailand's transportation fuel market that stem from inecient price structure and cross subsidies.

Suggested Citation

  • Wichsinee Wibulpolprasert & Bhawin Teveyanun, 2016. "The Social Cost of Thailand's Transportation Fuel Pricing Policy," PIER Discussion Papers 49, Puey Ungphakorn Institute for Economic Research.
    • Handle: RePEc:pui:dpaper:49
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    File URL: https://www.pier.or.th/files/dp/pier_dp_049.pdf
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    References listed on IDEAS

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    5. Jirath Chenphuengpawn, 2012. "Deadweight Loss of Alternative Energy Pricing Policy (in Thai)," Applied Economics Journal, Kasetsart University, Faculty of Economics, Center for Applied Economic Research, vol. 19(1), pages 1-23, June.
    6. Stampini, Marco & Tornarolli, Leopoldo, 2012. "The Growth of Conditional Cash Transfers in Latin America and the Caribbean: Did They Go Too Far?," IZA Policy Papers 49, Institute of Labor Economics (IZA).
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    Cited by:

    1. Kannika Duangnate & James W. Mjelde, 2022. "The Role of Pre-Commitments and Engle Curves in Thailand’s Aggregate Energy Demand System," Energies, MDPI, vol. 15(4), pages 1-16, February.

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    More about this item

    Keywords

    Social Cost; Fuel Pricing Policy; Deadweight Loss;
    All these keywords.

    JEL classification:

    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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