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Periodical article Periodical article Leiden University catalogue Leiden University catalogue WorldCat catalogue WorldCat
Title:The two-tier gasoline pricing policy of 1989: lessons for public policy from theory and practice
Author:Iwayemi, AkinISNI
Year:1991
Periodical:The Nigerian Journal of Economic and Social Studies
Volume:33
Issue:3
Pages:191-198
Language:English
Geographic term:Nigeria
Subjects:price policy
petroleum products
Abstract:Under the two-tier gasoline pricing policy introduced in Nigeria in 1989, commercial vehicle owners were to purchase gasoline at 42 kobo per litre at specially designated gasoline stations sited mainly in the urban areas and run by the major oil marketing companies. Noncommercial vehicle owners were to purchase their gasoline at 60 kobo per litre from the second-tier gasoline market, which was physically distinct from the first-tier market for commercial vehicles. The experiment was abolished at the end of 1989 after much abuse and high costs in terms of lost government revenue. To keep buyers and sellers of gasoline honest during the two-tier experiment would have required an effective deterrent or compliance cost which, to all practical purposes, was nonexistent. The failure of the two-tier policy raises questions regarding the role and input of economic analysis in policy formulation and debate in Nigeria. The author elaborates on the lessons that theory has for such policy experiments in Nigeria. Bibliogr., notes, ref.
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