Scientists and policy experts agree that the removal of current fossil fuel subsidies is a key policy solution for the ability of many countries to satisfy their Nationally Determined Contributions (NDCs) initialized by the Paris Agreement. Apart from obstructing a continuous use of fossil fuels and simultaneously releasing substantial public funds, phasing out subsidies is also necessary in order to realize the full effectiveness of other climate policy instruments including measures aimed at pricing carbon and CO2 emissions. In this study, we investigated public opinion on the removal of existing fossil fuel subsidies in five developing countries across several continents, using public attitudes to the more frequently studied carbon dioxide tax as our point of reference.
The study is unique in several ways. First, it focuses on climate policy attitudes in developing countries, thereby expanding the geographical scope of the current literature mainly centering in on public opinion in the developed world. Second, and even more importantly, the study fills an important gap as there currently are no reported studies of attitudes to fossil fuel subsidy removals, and how these attitudes can be altered by revenue recycling policies.
Contrary to our expectations, we do not find the resistance to removal of existing subsidies to be very strong in any of the five countries. Rather, attitudes were in par with those triggered by a suggestion to introduce a CO2 tax and the mean values for public acceptability are surprisingly high, also when compared with corresponding studies (on attitudes to carbon taxes) in developed countries. Furthermore, it is evident that attitudes can be affected so as to increase public acceptance by combining the suggestion for subsidy removal with a revenue recycling policy. We also find that the respondents’ concern for climate change is a strong driver of policy attitudes, and finally that the impact of revenue recycling varies across the five countries.
The findings have important policy implications. First, our overall results concerning policy attitudes imply that removing subsidies on fossil fuels in fact might be less politically challenging than what is commonly asserted. Furthermore, by specifying alternatives for revenue recycling where public funds currently used for subsidies are directed toward other public investments, the level of acceptability increases significantly. However, the answer to the question of which specific investments are the most popular is determined by context. This further highlights the need for careful empirical investigations in order to determine preferred options for revenue recycling among the public prior to making political decisions to remove or roll back existing fossil fuel subsidies.
The study has limitations. Although conducted over several continents, the total number of countries is small and there are most likely important nuances to be grasped by extending the sample. Furthermore, neither different levels of subsidy cuts, nor any variation in how quickly the subsidies should be removed is specified by the study. From previous research, however, we can expect that such elements of policy design do affect policy attitudes. In addition, the number of possible revenue recycling alternatives is considerable and there might well be alternatives that are more popular than the ones suggested in the current treatments, and thereby relevant to consider in future policy design.
Our study is one of rather few currently investigating attitudes to climate policy instruments in non-OECD countries as well as in the broader global south. As these countries are parties of the Paris Agreement and thereby struggle to find ways to limit their emissions, there is an increasing need for knowledge on attitudes and attitude formation in contexts outside of the OECD. Simultaneously, there is also a significant need for studies targeting actors’ (i.e., citizens, consumers, business, and other stakeholders) acceptance of subsidy removals in specific contexts. This need is palpable both in developing and more developed contexts, as significant subsidies on fossil fuel consumption and production do exist also within the OECD member states.
Finally, our results suggest that there seems to be rather favorable conditions for removing existing fossil fuel subsidies in the five countries covered in this study, and that a careful policy design and a simultaneous plan for revenue recycling can facilitate the removals even further. Since climate change concern is a factor that significantly affects policy attitudes, further public and media attention assigned to climate change may make subsidy removals even more conceivable and open up promising avenues for developing countries to contribute to the global mitigation of climate change. At the same time, fossil fuel subsidy removal release public funds for investing in social and economic development, which is very much needed in many developing countries.