...TUTORIAL WORK ELECTRICITY SUBSIDY Members: * Roberto Garzón * Ludwin Gutiérrez * Karina Peña * Joseph Valarezo How as electricity subsidy affects families of Guayaquil? INTRODUCTION Ecuadorian economy has shown a sustained growth in recent years, allowing to the Ecuadorian government to invest in health, education, housing, and some projects for the strengthening of the country. However, it is necessary to control and reduce costs as subsidies. There are subsidies, which are targeted to certain groups of the population according to their characteristics. For example, the Solidarity bonus is a subsidy that is targeted to people in the poorest municipalities in the country and whose income is too low. By the other hand, there are also generalized subsidies, which do not make a proper distinction between groups with different characteristics in the population since they reach all citizens. For example, the electricity subsidy in Ecuador This research shows how people who live in the center of Guayaquil is affected by the reduction of the electricity subsidy since this tool has become in the last seventy years the most used in country due to its versatility, cost, availability, and ease of use. These characteristics make it essential in the human activities either in factories or in the houses since the electricity allows turning on appliances or machines for working or facilitating the lives of people. However, removal of fuel subsidy as gas (LPG) and gasoline...
Words: 1183 - Pages: 5
...Indonesia’s Fuel Subsidies: Action plan for reform David Braithwaite Alexander Chandra Prasetyaning Diah R. L. Ami Indriyanto Kerryn Lang Lucky Lontoh Nataliawati Siahaan Damon Vis-Dunbar Bobby A. Wattimena Unggung Widhiantoro Peter Wooders NE SI A N I N S TI TU T E F OR E N E RG IN DO I I EE FO U N D AT I O N C O NOM I YE CS March 2012 www.iisd.org/gsi © 2012 The International Institute for Sustainable Development © 2012 The International Institute for Sustainable Development Published by the International Institute for Sustainable Development. About IISD The International Institute for Sustainable Development (IISD) contributes to sustainable development by advancing policy recommendations on international trade and investment, economic policy, climate change and energy, and management of natural and social capital, as well as the enabling role of communication technologies in these areas. We report on international negotiations and disseminate knowledge gained through collaborative projects, resulting in more rigorous research, capacity building in developing countries, better networks spanning the North and the South, and better global connections among researchers, practitioners, citizens and policy-makers. IISD’s vision is better living for all—sustainably; its mission is to champion innovation, enabling societies to live sustainably. IISD is registered as a charitable organization in Canada and has 501(c)(3) status in the United...
Words: 22015 - Pages: 89
...The modern agricultural subsidy program in the United States began with the New Deal and the Agricultural Adjustment Act of 1933. With trader barriers already in place for agricultural commodities, this law gave the government the power to set minimum prices and included government stock acquisition, land idling, and schemes to cut supplies by destroying livestock (Benedict, 1953). An agricultural subsidy is a government subsidy paid to farmers and agribusinesses to supplement their income, manage the supply of agricultural commodities and influence the cost and supply of commodities, such as wheat, grain, corn, milk, and soybeans (Agricultural Subsidy, 2012). The government subsidy program was originally designed to protect small family farms against loss of income due to poor crop yields, as well as create lower food prices and stabilize crop supplies. Annual yields are dependent upon factors that farmers often cannot control, such as severe weather conditions. Due to this, it’s contingent upon the government to encourage crop surplus to help guarantee against shortages. The high cost of land, planting, and storage makes it necessary for farmers to borrow and exorbitant amount of money. When the farmers can’t pay this money back because of low crop yields, they rely on these government subsidies to survive. Today’s farm operations have transformed the family farm from a small, self-contained business to a complex, technology-driven enterprise as seen in the rapidly...
Words: 1274 - Pages: 6
...Research Suggests Farm Subsidies are the Reason Americans Pay Higher Food Prices, Higher Taxes, Ending Small-Scale Farming while Destroying our Ecosystem: Michael L Ashcraft Western Governors University Background: Over 70 years ago, The Roosevelt administration announced the onset of government farm subsidies as a temporary emergency measure to help farmers earn a certain level of income. Although there have been dramatic efficiency upgrades within the farming industry, little change has been changed made regarding how the government funds farm subsidies. The basic idea of how government subsidies function, the government spends hundreds of millions of dollars to raise farmers incomes by raising the price of certain farm commodities. This increase in price encourages farmers to produce these subsidized commodities in large amounts, while encouraging consumers to buy them in small amounts (Armey, R. K., 1990). The result of producing large amounts while purchased amounts are low creates a surplus. Once a surplus occurs the government spends hundreds of millions of dollars encouraging farmers to discontinue producing the certain commodities, essentially subsidizing farmers not to farm. This policy creates great inefficiency, under the farm law passed in 1985, the Department of Agriculture has paid dairy farmers to kill 1.6 million cows and take five-year vacations from farming. Regulations have been enforced that have led to the squandering...
Words: 2071 - Pages: 9
...Dope sheet- agricultural subsidies in India 1) What is subsidy? Subsidies are grants given to a specified public to get a desired action from their side, for instance, when government is feeling that the yield per hectare is low which can be increased by using fertilizers, than government gives fertilizers subsidies so that small farmers can purchase the fertilizer. This means that subsidy is changing the price exogenously to alter the demand and supply figures. Most controversial classes of subsidies across the world are fuel subsidies and agricultural subsidies and today we are discussing agricultural subsidies. 2) What are the latest news stories about subsidies? There is omnipresence of this word subsidy. Recently some big stories came out of this word. Some 12 stories came in month of October itself. For example a) Government is worried because they think their subsidy bill will increase this time because of good monsoons. b) Raghuram rajan, chief advisor to prime minister says we are mistargeting subsidies. c) Manpreet sing from shrimoni akali dal (sad) was thrown out of his finance portfolio because he wanted to do away with power subsidies of 3000 crore. Punjab Government is in debt of almost 150000 crore rupees. 3) Why we need subsidy, what are the benefits of subsidy as a policy? a) Inducing higher consumption/ production b) Offsetting market imperfections including internalisation of externalities c) Achievement of social policy objectives including redistribution...
Words: 3440 - Pages: 14
...Corn Subsidies Is Concern Corn Subsidies storm has reported a paragraph, due to various pressures, the urgent need for corn reform, the reform of labor pains are inevitable, so the country would like to use subsidies to farmers to compensate for declining revenue problem. I believe we still in a chaos state for subsidies, we do not know how much money to make up, make up and in what way, in what way the actual subsidy growers. Set a national level to protect farmers' income, the formation of market prices, the difference intermediate supply farmers. This year the reservoir is canceled, the lack of temporary storage of the big buyers of support and intervention, corn prices will gradually return to the market price, the farmer sell grain will also follow the market prices, the price is certainly low, as a measure point, market prices and import prices can refer to. Grassroots implementation of public food subsidy system, area verification system, implementation of the card subsidy funds and other funds through a discount payment system. Public subsidies to make use of subsidies transparent, supervision by the masses, and to verify the area, with a card, etc. That directly to paid the subsidies for farmers hands, like subsidies, avoid link subsidies to the peasants " weight "problem appears inadequate. In short, recently years farmers income will be enter to winter, subsidies can only alleviate but can not really change the farmers' income, so farmers need to consider...
Words: 263 - Pages: 2
...Corn Subsidies storm has reported a paragraph, due to various pressures, the urgent need for corn reform, the reform of labor pains are inevitable, so the country would like to use subsidies to farmers to compensate for declining revenue problem. I believe we still in a chaos state for subsidies, we do not know how much money to make up, make up and in what way, in what way the actual subsidy growers. Set a national level to protect farmers' income, the formation of market prices, the difference intermediate supply farmers. This year the reservoir is canceled, the lack of temporary storage of the big buyers of support and intervention, corn prices will gradually return to the market price, the farmer sell grain will also follow the market prices, the price is certainly low, as a measure point, market prices and import prices can refer to. Grassroots implementation of public food subsidy system, area verification system, implementation of the card subsidy funds and other funds through a discount payment system. Public subsidies to make use of subsidies transparent, supervision by the masses, and to verify the area, with a card, etc. That directly to paid the subsidies for farmers hands, like subsidies, avoid link subsidies to the peasants " weight "problem appears inadequate. In short, recently years farmers income will be enter to winter, subsidies can only alleviate but can not really change the farmers' income, so farmers need to consider how their own power, to seek...
Words: 259 - Pages: 2
...The argument for farm subsidies -- though not the ones we have now By Ezra Klein Mark Bittman makes the case for mending, rather than ending, farm subsidies: Eliminating the $5 billion in direct agricultural payments would level the playing field for farmers who grow non-subsidized crops, but just a bit -- perhaps not even noticeably. There would probably be a decrease in the amount of [high-fructose corn syrup] in the market, in the 10 billion animals we “process” annually, in the ethanol used to fill gas-guzzlers and in the soy from which we chemically extract oil for frying potatoes and chicken. Those are all benefits, which we could compound by taking those billions and using them for things like high-speed rail, fulfilling our promises to public workers, maintaining Pell grants for low-income college students or any other number of worthy, forward-thinking causes. ... But let’s not kid ourselves. Although the rage for across-the-board spending cuts doesn’t extend to the public -- according to a recent Pew poll, most people want no cuts or even increased spending in major areas -- once the $5 billion is gone, it’s not coming back. ... By making the program more sensible the money could benefit us all. For example, it could: -- Fund research and innovation in sustainable agriculture, so that in the long run we can get the system on track. -- Provide necessary incentives to attract the 100,000 new farmers Secretary of Agriculture Vilsack claims we need. -- Save more...
Words: 1104 - Pages: 5
...WHO REALLY BENEFITS FROM AGRICULTURAL SUBSIDIES? EVIDENCE FROM FIELD-‐LEVEL DATA Barrett Kirwan University of Maryland Michael J. Roberts North Carolina State University February 2010 [Preliminary and Incomplete] ABSTRACT The idea that agricultural subsidies are fully capitalized into farmland values forms the foundation of the argument that subsidies are entitlements and removing them would drastically reduce farmland asset values. Surprisingly little evidence substantiates this claim. Using field-‐level data and explicitly controlling for potentially confounding variables we find that landlords only capture between 14 – 24 cents of the marginal subsidy dollar. The duration of the rental arrangement has a substantial effect on the incidence. Initially, landlords extract 44 cents of the marginal subsidy dollar, but the incidence falls by 1.5 cents with each additional year of ...
Words: 4143 - Pages: 17
...Implications of Fuel Subsidy to Nigerian Economy Babandi Ibrahim Gumel Doctor of Business Administration California Southern University Mike Ewald, PhD November 2015 Introduction This paper would discuss the implications of fuel subsidy in the Nigerian economy. It is a position paper as an extra credit assignment for ECO 87501 for DBA course at California Southern University. The paper would review what subsidy is, the reason for subsidizing petroleum product in Nigeria, challenges the Nigerian economy is facing because of subsidizing petroleum products, and the crisis the country is facing because of subsidy. Analysis According to the dictionary of Investopedia, “subsidy is a benefit given by the government to groups or individuals usually in the form of a cash payment or tax reduction. The subsidy is given to remove some burden and is often considered to be in the interest of the public. Politics plays an important part in subsidization. In general, the left is more for having subsidized industries, while the right feels that industry should stand on its own without public funds” (Investopedia, 2015, p. 1). The above definition clearly indicates that the subsidy is a kind of free money in whatever form given to the public by Government. It is worth noting that the definition highlighted that politics plays a role in subsidy, and politicians on the left, (e.g. in U. S. the Democrats) favor subsidy. The Merriam-webmaster dictionary defines subsidy as “money that is usually...
Words: 1471 - Pages: 6
...The effects of subsidies The opportunity cost of subsidies People who defend subsidies for particular sectors often highlight the goods or services that have been produced, or the new jobs created. What they do not normally acknowledge is that the benefits to society of that money, if it had been spent otherwise, or left in the pockets of taxpayers, might have been even greater. Economists refer to the value of an expenditure in its highest alternative use as its "opportunity cost." The concept of opportunity cost is reasonably intuitive. At the household level, if a person spends $100 on a night on the town, that $100 is no longer available to buy necessities, like food. Similarly, if a government spends $100,000 on a bridge that few people will use, that money is not available to be spent on education, or health care, or any other government priority. Because of taxes and other feedback mechanism in an economy, the analogy between the government and a household is not perfect. But in the presence of a budget constraint, all spending decisions, at the margin, imply trade-offs. Ideally, a government would strive to structure its expenditures so as to achieve a return to society that is roughly similar for each dollar spent. Subsidies can easily upset that balance. Consider a hydro-electric project that also provides water to irrigate adjacent farmland. A cubic metre of water from its reservoir has a high value when it passes through turbines and generates electricity...
Words: 1845 - Pages: 8
...NAME: Fatmah Ibrahim CLASS: SS 3A SUBJECT: Economics Topic: The Effect of subsidy in Nigeria Economy THE EFFECTS OF SUBSIDY IN NIGERIA ECONOMY. DEFINATION A subsidy is an assistance paid to a business or economic sector. Most subsidies are made by the government to producers or distributed as subventions in an industry to prevent the decline of that industry (e.g., as a result of continuous unprofitable operations) or an increase in the prices of its products or simply to encourage it to hire more labor (as in the case of a wage subsidy). Examples are subsidies to encourage the sale of exports; subsidies on some foods to keep down the cost of living, especially in urban areas; and subsidies to encourage the expansion of farm production and achieve self-reliance in food production.[1] EFFECTS OF SUBSIDY REMOVAL In a country of power instability the removal of fuel subsidy has triggered double in the price of fuel . 1. increased price of fuel and other petroleum product 2. increase in transport fares 3. increased price of food products. The Lagos Chamber of Commerce and Industry (LCCI) has listed some of the adverse effects of the Federal Government's recent policy to deregulate the nation's downstream oil sector LCCI, in a statement, said the policy has led to fresh inflationary pressures resulting from sharp increases in transportation cost, high inflationary expectations across all sectors of the economy, and a devastating impact on the psyche of the common people...
Words: 717 - Pages: 3
...Effects of Government Subsidies on Small Farmers DeVry University Effects of Government Subsidies on Small Farmers Growing up in the rural Midwest I have known and been close friends with quite a few farm families. Until reading The Omnivore’s Dilemma, I never fully understood the impact that government subsidies had on the average family farmer. While I understand the need for some government intervention to keep farmers able to work, I think the government has overstepped their boundaries and ended up hurting the very people these plans were put in place to protect. Current government farm subsidies are geared towards large corporations at the expense of small, family farmers: most farm subsidies are only paid for corn and soybean growers and leave out small farmers growing other crops while artificially lowering the price of these crops to sometimes below the actual cost of production, and the majority of farm subsidy payouts go to the top 10% of producers; some proposed solutions are to overhaul the current USDA farm subsidy programs to include farmers growing crops other than corn and soybeans, change the way the subsidies are paid to help bring the crop prices more in line with the cost of production, to put a cap on the amount of subsidies paid out to any individual farm or to just do away with the USDA farm subsidy program altogether. Problems Research shows that 90% of all USDA farm subsidies go to the growers of only 5 crops; corn, cotton, rice, wheat...
Words: 2329 - Pages: 10
...Whether the city should build and run a facility for guarded car parking It is indisputable that car- related theft is one of the most common offences city dwellers encounter. People often feel hurt or experience a sense of loss when they lose their valuable belongings to car thieves and this in turn has a negative impact on the general public. Though the problem with car burglaries may seem to be petty crime but local governments cannot afford to not concretely and comprehensively solve or minimize. After all, car- related thefts not only affect one man or woman on the streets but also impact the whole society with cars who either live in the city center or drive from distant locales to get to the city in order to attend to their different interests and duties/responsibilities. For a city to have a harmonious coexistence among its inhabitants, security and the protection of individual properties is one of the major pillars to achieve this goal. In order to achieve this kind of objectives, there must be an efficient, transparent and accountable body to be trusted with resolving the matter. The issue can be solved but requires the effort of entrusted entity to guarantee the safety of every car owner who comes to the city. One has to take into consideration the fact that the city has the vital responsibility and a valid interest in the provision of secured car parking to the public for protecting its image and attractiveness. On the other hand, this can come at a high price...
Words: 1504 - Pages: 7
...Controversy The Economist 11 January 2014 Overview of Article Many governments subsidise fuel consumption. However, many countries that currently subsidise fuel are starting to reverse course. In June 2013, Indonesia increased fuel prices by 44% and decreased their total subsidy cost by $20 billion annually. Malaysia also reduced fuel subsidies – household energy bills increased by 15% as a result. Egypt and India are considering following suit. The key rationale to these governments of removing subsidies was to decrease the budget deficit. Effects of Fuel Subsidy According to Article The article discusses that there are many other benefits to reducing fuel subsidies. o Fuel subsidies generate deadweight loss. o Fuel subsidies make inequality worse – it is mostly the rich that benefit (the rich use fuel disproportionately more). o Removal of fuel subsidies will allow the government to develop infrastructure. These policies are unpopular, however, and many in Indonesia and Malaysia protested the new policies. Fuel Prices around the World Indonesia and Malaysia have some of the largest fuel subsidies and lowest fuel prices in the world. Analysis of Welfare Effects of Fuel Subsidy This article discusses that there are deadweight losses...
Words: 750 - Pages: 3
