Iran is a resource-based country and these resources have brought advantages and disadvantages to the country. It seems that disadvantages are results of mismanagement of the resources and not the existence of resources. Fuel subsidy is an example of such mismanagements. While fuel subsidies are common in the Middle East, the oil-richest place of the world, Iranian domestic fuel prices are among the lowest in the world. The low fuel prices population growth, and urbanization growth have caused growth of fuel consumption and consequently growth of subsidies. Since nothing can grow forever, two years ago the government had to start a rationing plan to reduce the growth of fuel consumption due to budget and gasoline stock limitations.In this paper we will model dynamics of the problem and answer why the government had to execute the rationing plan. Furthermore; we try to show that this solution is not a fundamental one. It is a symptomatic solution in which the ration of each car will decrease after a while. In the end, we offer two policies to limit the demand naturally, not by force of rationing plan, and try to offer a fundamental solution to manage the fuel consumption.
展开▼
