REDUCING POVERTY THROUGH SUBSIDIES: SIMULATION OF FUEL SUBSIDY DIVERSION TO NON-FOOD CROPS

Authors

Indra Maipita, Universitas Negeri MedanFollow
Wawan Hermawan, Padjajaran UniversityFollow
Fitrawaty Fitrawaty, Universitas Negeri MedanFollow

Document Type

Article

Abstract

This paper analyzes the impact of fuel subsidy diversion to Non-Food Crops sector on income levels, using AGEFIS; a Computable General Equilibrium model. Then we proceed to apply the Foster-Greer-Thorbecke (FGT) index to measure the indicators of poverty (head count index, poverty gap index and poverty severity index). The simulation result shows the fuel subsidy diversion to Non-Food Crops sector provides a positive impact on increasing household incomes and poverty reduction. Furthermore, the fuel subsidy diversion to Non-Food Crops sector reduces the poverty of rural household, larger than the urban households.

Recommended Citation

Maipita, Indra; Hermawan, Wawan; and Fitrawaty, Fitrawaty (2012) "REDUCING POVERTY THROUGH SUBSIDIES: SIMULATION OF FUEL SUBSIDY DIVERSION TO NON-FOOD CROPS," Bulletin of Monetary Economics and Banking: Vol. 14: No. 4, Article 1.
DOI: https://doi.org/10.21098/bemp.v14i4.412
Available at: https://bulletin.bmeb-bi.org/bmeb/vol14/iss4/1

First Page

349

Last Page

366

Creative Commons License

This work is licensed under a Creative Commons Attribution-NonCommercial 4.0 International License

Country

Indonesia

Affiliation

Universitas Negeri Medan