Prioritize carbon pricing over fossil-fuel subsidy reform

Jeroen van den Bergh*, Cees van Beers, Lewis C. King

*Corresponding author for this work

Research output: Contribution to journalReview articlepeer-review

24 Downloads (Pure)


While many climate activist groups enthusiastically advocate for the removal of fossil-fuel subsidies, we argue that this overstates both the climate effectiveness and political feasibility of such a strategy. Through synthesizing information from various global studies, we show that subsidies contribute to a relatively small portion of climate change and local externality problems, likely accounting for around 1%. We further argue that reform of fossil-fuel subsidies is hampered by various political and social factors, more so than the diffusion of carbon pricing. Based on these results, we argue that the far greater problem of unpriced externalities warrants a redirection or expansion of the enthusiasm for subsidy reform toward carbon pricing. This makes sense also as subsidy reform and carbon pricing essentially represent two sides of the same coin since both contribute to climate mitigation by raising fossil-fuel prices.
Original languageEnglish
Article number108584
Issue number1
Publication statusPublished - 2024


  • Environmental policy
  • Global change


Dive into the research topics of 'Prioritize carbon pricing over fossil-fuel subsidy reform'. Together they form a unique fingerprint.

Cite this