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From Lock-In to Phase-Out : Pathways Towards Fossil Fuel Subsidy Reform

Drake, Evan LU orcid (2025)
Abstract
This dissertation investigates the political determinants of fossil fuel subsidy reform in OECD countries between 2009 and 2023. Despite widespread recognition of their economic inefficiency and environmental harm, fossil fuel subsidies remain entrenched, with OECD countries collectively sustaining around USD 100 billion in annual support. The research addresses why some governments successfully reduce these subsidies whilst others do not. It conceptualises these subsidies as critical mechanisms of "carbon lock-in" that entrench fossil fuel dependence and impede climate action. Drawing on multiple strands of political science literature, the dissertation develops an integrated analytical framework that considers the roles of institutional... (More)
This dissertation investigates the political determinants of fossil fuel subsidy reform in OECD countries between 2009 and 2023. Despite widespread recognition of their economic inefficiency and environmental harm, fossil fuel subsidies remain entrenched, with OECD countries collectively sustaining around USD 100 billion in annual support. The research addresses why some governments successfully reduce these subsidies whilst others do not. It conceptualises these subsidies as critical mechanisms of "carbon lock-in" that entrench fossil fuel dependence and impede climate action. Drawing on multiple strands of political science literature, the dissertation develops an integrated analytical framework that considers the roles of institutional configurations, governing party preferences, policy processes, and affective polarisation in shaping reform trajectories. Using a mixed-methods approach and four
complementary articles covering 34 OECD countries, the research identifies both structural and strategic pathways to reform. Key findings show that proportional representation and corporatist institutions are associated with lower subsidy levels, by offering electoral insulation and facilitating compensatory
strategies. Governments led by environmentally committed parties tend to reduce subsidies, whereas market-liberal parties increase them—particularly when they hold parliamentary majorities. The study also introduces the concept of "dismantling by layering", where incremental policies such as carbon taxes
erode subsidies indirectly, minimising direct political confrontation. Finally, the dissertation develops a research agenda and theoretical framework proposing how affective polarisation may constrain reform by transforming climate policies into partisan identity markers. Together, the findings suggest that the
climate governance challenge is not primarily about identifying technically optimal policy instruments but about understanding the political conditions under which necessary policies become feasible—an analytical shift with profound implications for both academic research and policy practice in addressing the climate crisis. (Less)
Abstract (Swedish)
Denna avhandling undersöker de politiska orsakerna till reformer av subventioner av fossila bränslen i OECD-länderna mellan 2009 och 2023. Trots att subventioner för fossila bränslen är allmänt erkända som ekonomiskt ineffektiva och miljöskadliga, är de fortfarande djupt rotade, där OECD-länderna tillsammans upprätthåller ett årligt stöd på cirka 100 miljarder US-dollar.

Avhandlingen behandlar frågan om varför vissa regeringar lyckas minska dessa subventioner medan andra inte gör det. Den konceptualiserar dessa subventioner som avgörande mekanismer för att lösa ”inlåsningseffekter” som befäster beroendet av fossila bränslen och hindrar klimatåtgärder.

Med utgångspunkt i flera olika typer av statsvetenskaplig forskning... (More)
Denna avhandling undersöker de politiska orsakerna till reformer av subventioner av fossila bränslen i OECD-länderna mellan 2009 och 2023. Trots att subventioner för fossila bränslen är allmänt erkända som ekonomiskt ineffektiva och miljöskadliga, är de fortfarande djupt rotade, där OECD-länderna tillsammans upprätthåller ett årligt stöd på cirka 100 miljarder US-dollar.

Avhandlingen behandlar frågan om varför vissa regeringar lyckas minska dessa subventioner medan andra inte gör det. Den konceptualiserar dessa subventioner som avgörande mekanismer för att lösa ”inlåsningseffekter” som befäster beroendet av fossila bränslen och hindrar klimatåtgärder.

Med utgångspunkt i flera olika typer av statsvetenskaplig forskning utvecklar avhandlingen ett integrerat analytiskt ramverk som beaktar den roll institutionella konfigurationer, regerande partiers preferenser, policy processer och affektiv polarisering har i utformningen av reformer.

Med hjälp av olika typer av forskningsmetoder och fyra kompletterande artiklar som fokuserar på 34 OECD-länder identifierar forskningen både strukturella och strategiska vägar till reform.

Ett viktigt resultat i avhandlingen är att proportionell representation och korporativistiska institutioner är förknippade med lägre subventionsnivåer, genom att de gör det möjligt för regeringar att undvika bestraffning av väljarna och underlättar kompensationsstrategier.

Ett annat viktigt resultat är att regeringar som leds av partier engagerade i miljöfrågor tenderar att minska subventionerna, medan marknadsliberala partier ökar dem – särskilt när de har stöd av en majoritet i parlamentet.

Studien introducerar också begreppet ”dismantling by layering”, där stegvisa policyåtgärder såsom koldioxidskatter indirekt urholkar subventioner, vilket kan minska risken för politiska konflikter.

Slutligen utvecklar avhandlingen en forskningsagenda och ett teoretiskt ramverk som visar på hur affektiv polarisering kan komma att begränsa reformutrymmet genom att omvandla klimatpolitiken till en kamp mellan partipolitiska identiteter.

Sammantaget tyder resultaten på att utmaningen med klimatstyrning inte i första hand handlar om att identifiera tekniskt optimala politiska instrument, utan om att förstå de politiska förutsättningarna för att genomföra nödvändiga politiska åtgärder. Detta är en analytisk förskjutning med djupgående konsekvenser för både forskningen och politisk praxis när det gäller att hantera klimatkrisen.
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Please use this url to cite or link to this publication:
author
supervisor
opponent
  • Professor Duit, Andreas, Stockholm University
organization
publishing date
type
Thesis
publication status
published
subject
keywords
fossil fuel subsidies, climate policy, policy change, political polarisation, party systems, political economy, carbon taxes, OECD
pages
186 pages
publisher
Lund University (Media-Tryck)
defense location
Edens hörsal, Allhelgona kyrkogata 14, Lund
defense date
2025-10-10 10:15:00
ISBN
978-91-8104-658-8
978-91-8104-657-1
project
Pathways to Breaking the Fossil Fuel Lock-In: Assessing the Influence of the Paris Agreement and the Sustainable Development Goals on Fossil Fuel Subsidy Reform
From Lock-In to Phase-Out: Pathways Towards Fossil Fuel Subsidy Reform
language
English
LU publication?
yes
id
13946d0a-2a76-49b8-89ad-bce586d42051
date added to LUP
2020-09-23 18:08:16
date last changed
2025-09-10 10:28:28
@phdthesis{13946d0a-2a76-49b8-89ad-bce586d42051,
  abstract     = {{This dissertation investigates the political determinants of fossil fuel subsidy reform in OECD countries between 2009 and 2023. Despite widespread recognition of their economic inefficiency and environmental harm, fossil fuel subsidies remain entrenched, with OECD countries collectively sustaining around USD 100 billion in annual support. The research addresses why some governments successfully reduce these subsidies whilst others do not. It conceptualises these subsidies as critical mechanisms of "carbon lock-in" that entrench fossil fuel dependence and impede climate action. Drawing on multiple strands of political science literature, the dissertation develops an integrated analytical framework that considers the roles of institutional configurations, governing party preferences, policy processes, and affective polarisation in shaping reform trajectories. Using a mixed-methods approach and four<br/>complementary articles covering 34 OECD countries, the research identifies both structural and strategic pathways to reform. Key findings show that proportional representation and corporatist institutions are associated with lower subsidy levels, by offering electoral insulation and facilitating compensatory<br/>strategies. Governments led by environmentally committed parties tend to reduce subsidies, whereas market-liberal parties increase them—particularly when they hold parliamentary majorities. The study also introduces the concept of "dismantling by layering", where incremental policies such as carbon taxes<br/>erode subsidies indirectly, minimising direct political confrontation. Finally, the dissertation develops a research agenda and theoretical framework proposing how affective polarisation may constrain reform by transforming climate policies into partisan identity markers. Together, the findings suggest that the<br/>climate governance challenge is not primarily about identifying technically optimal policy instruments but about understanding the political conditions under which necessary policies become feasible—an analytical shift with profound implications for both academic research and policy practice in addressing the climate crisis.}},
  author       = {{Drake, Evan}},
  isbn         = {{978-91-8104-658-8}},
  keywords     = {{fossil fuel subsidies; climate policy; policy change; political polarisation; party systems; political economy; carbon taxes; OECD}},
  language     = {{eng}},
  publisher    = {{Lund University (Media-Tryck)}},
  school       = {{Lund University}},
  title        = {{From Lock-In to Phase-Out : Pathways Towards Fossil Fuel Subsidy Reform}},
  url          = {{https://lup.lub.lu.se/search/files/226757007/e-nailing_ex_Drake.pdf}},
  year         = {{2025}},
}