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Easing the traffic: The effects of Indonesia’s fuel subsidy reforms on toll-road travel

Burke, Paul; Batsuuri, Tsendsuren; Yudhistira, Muhammad Halley

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Indonesia has serious traffic jams. This study uses data from 19 Indonesian toll roads over 2008–2015 to calculate the effects of Indonesia’s historic recent fuel subsidy reforms on motor vehicle travel. The timing of the reforms was determined by budgetary and political factors, providing a suitable setting for estimating a causal effect. We control for a broad set of other factors potentially influencing traffic flows. Estimates using monthly data suggest an immediate fuel price elasticity of...[Show more]

dc.contributor.authorBurke, Paul
dc.contributor.authorBatsuuri, Tsendsuren
dc.contributor.authorYudhistira, Muhammad Halley
dc.date.accessioned2017-09-22T04:26:03Z
dc.identifier.citationBurke, Paul J., Batsuuri, Tsendsuren, and Yudhistira, Muhammad Halley. 2017. 'Easing the traffic: The effects of Indonesia’s fuel subsidy reforms on toll road travel.' Transportation Research Part A: Policy and Practice 105: 167–180.
dc.identifier.issn0965-8564
dc.identifier.urihttp://hdl.handle.net/1885/128512
dc.description.abstractIndonesia has serious traffic jams. This study uses data from 19 Indonesian toll roads over 2008–2015 to calculate the effects of Indonesia’s historic recent fuel subsidy reforms on motor vehicle travel. The timing of the reforms was determined by budgetary and political factors, providing a suitable setting for estimating a causal effect. We control for a broad set of other factors potentially influencing traffic flows. Estimates using monthly data suggest an immediate fuel price elasticity of motor vehicle flows on the roads in our study of –0.1, increasing to –0.2 when responses over a year are considered. We estimate that Indonesia’s fuel subsidy reforms of 2013 and 2014 had reduced traffic pressure on these roads in the second half of 2015 by around 10% relative to the counterfactual without reform. A move to an adequate fuel excise system could contribute to more free-flowing traffic, while generating revenue for infrastructure and other investment.
dc.description.sponsorshipThis research received funding from the Australian Research Council (DE160100750).
dc.format.mimetypeapplication/pdf
dc.publisherElsevier
dc.rights© 2017 Elsevier.
dc.sourceTransportation Research Part A: Policy and Practice
dc.subjectfuel subsidy
dc.subjectgasoline
dc.subjectprice elasticity
dc.subjecttransport
dc.subjectIndonesia
dc.titleEasing the traffic: The effects of Indonesia’s fuel subsidy reforms on toll-road travel
dc.typeJournal article
local.description.notesThere is a post-print version available here: https://acde.crawford.anu.edu.au/publication/working-papers-trade-and-development/11133/easing-traffic-effects-indonesias-fuel
local.identifier.citationvolume105
dcterms.dateAccepted2017-08
dc.date.issued2017-11
local.identifier.absfor140217 - Transport Economics
local.publisher.urlhttp://www.elsevier.com/
local.type.statusAccepted Version
local.contributor.affiliationBurke, P. J., The Australian National University
dc.relationhttp://purl.org/au-research/grants/arc/DE160100750
local.identifier.essn1879-2375
local.bibliographicCitation.startpage167
local.bibliographicCitation.lastpage180
local.identifier.doi10.1016/j.tra.2017.08.003
local.identifier.absseo880107 - Road Passenger Movements (excl. Public Transport)
dcterms.accessRightsOpen Access
dc.provenancehttp://www.sherpa.ac.uk/romeo/issn/0965-8564/..."Author's post-print on open access repository after an embargo period of between 12 months and 48 months" from SHERPA/RoMEO site (as at 22/09/17).
CollectionsANU Research Publications

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