The Role of Information in Perception of Fossil-Fuel Subsidy Reform: Evidence from Indonesia

46 Pages Posted: 11 Apr 2015

See all articles by Rimawan Pradiptyo

Rimawan Pradiptyo

Universitas Gadjah Mada (UGM) - Department of Economics

Abraham Wirotomo

Universitas Gadjah Mada (UGM) - Faculty of Economics and Business (FEB)

Alvin Adisasmita

Universitas Gadjah Mada (UGM) - Research and Training in Economics and Business (P2EB)

Yudistira Hendra Permana

Vocational School, Universitas Gadjah Mada

Date Written: March 2015

Abstract

This paper analyzes household perceptions and the role of information in the fossil-fuel subsidy reforms (FFSR) in Indonesia. The data used in this study were collected by Lembaga Survei Indonesia (LSI), based on an August 2014 survey that involved 2,899 respondents in 34 Indonesian provinces. Survey logistic and multinomial logistic regressions approaches were used in this study. The results show that: (1) those who live outside Java tend to be more receptive to the idea of FFSR (2) The tendency of respondents to oppose the reform is attributable to ownership of motorcycles and cars (3) Providing information about the state budget and the personal impact of the subsidy could change a respondent’s opinion from opposition to support of the reform. These results indicated public resistance to a subsidy removal policy was not permanent. Those who own cars and/or motorcycles tend to be more resistant to FFSR than those who do not possess one.

Keywords: fuel subsidy reform, household perception, survey, survey logistic regression, survey multinomial logistic regression

JEL Classification: C31, D12, Q32, Q38.

Suggested Citation

Pradiptyo, Rimawan and Wirotomo, Abraham and Adisasmita, Alvin and Permana, Yudistira Hendra, The Role of Information in Perception of Fossil-Fuel Subsidy Reform: Evidence from Indonesia (March 2015). Available at SSRN: https://ssrn.com/abstract=2592518 or http://dx.doi.org/10.2139/ssrn.2592518

Rimawan Pradiptyo (Contact Author)

Universitas Gadjah Mada (UGM) - Department of Economics ( email )

Bulaksumur
Sleman
Yogyakarta, Daerah Istimewa Yogyakarta 55281
Indonesia

HOME PAGE: http://rimawan.staff.ugm.ac.id

Abraham Wirotomo

Universitas Gadjah Mada (UGM) - Faculty of Economics and Business (FEB) ( email )

Jl. Humaniora, Bulaksumur
Sleman
Jogjakarta, DI Yogyakarta 55281
Indonesia

Alvin Adisasmita

Universitas Gadjah Mada (UGM) - Research and Training in Economics and Business (P2EB) ( email )

Pertamina Tower Building 2nd Floor
Sosio Humaniora Street No. 1, Bulaksumur
Yogyakarta, Daerah Istimewa Yogyakarta (DIY) 55281
Indonesia

Yudistira Hendra Permana

Vocational School, Universitas Gadjah Mada ( email )

Bulaksumur
Yogyakarta, Special Region of Yogyakarta 55281
Indonesia

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