Hooked on Subsidies : The Case for Reform

Overview & Synopsis

This report goes beyond diagnosing subsidy problems to provide clear, evidence based, and politically grounded guidance for policy makers on reform paths. It offers a comprehensive overview of the costs and benefits of subsidies, along with strategies for reform. It outlines pathways for accounting, designing, assessing, and restructuring subsidies to improve policy outcomes and generate significant public savings. The Report also offers a roadmap for securing public and stakeholder support and addressing political economy constraints, offering examples from successful cases where political economy challenges were addressed. By recognizing these constraints, the Report helps policy makers chart realistic paths forward by focusing first on the most costly and inefficient subsidies, prioritizing reforms that are politically feasible, and addressing not just subsidy design but also implementation and governance. Above all, it reassures policy makers that incremental steps are both possible and worthwhile - and that even partial reforms can deliver meaningful fiscal and developmental gains.