Formulating Policy in Indonesia: perceptions of key stakeholders on the conditions for the introduction of a carbon tax

Author: . Rakhmindyarto

  • Thesis download: available for open access on 19 Nov 2023.

Rakhmindyarto, ., 2020 Formulating Policy in Indonesia: perceptions of key stakeholders on the conditions for the introduction of a carbon tax, Flinders University, College of Business, Government and Law

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Abstract

A carbon tax is considered the most efficient climate mitigation policy for reducing GHG emissions. However, it is argued that this policy is not well suited for Indonesia, because it has a number of political, economic, and institutional barriers that prevent the consideration of introducing a carbon tax.

This thesis seeks to understand why Indonesia does not have a carbon tax and how such a tax could potentially be introduced given the aforementioned barriers. It also investigates the conditions for an effective climate policy process in Indonesia by identifying the diversity of stakeholder perspectives. In doing so, this thesis applies a grounded theory method, using in-depth elite interviews with 29 key Indonesian stakeholders undertaken between August and December 2016.

This thesis finds that there are three key reasons why Indonesia does not have a carbon tax or why a carbon tax is so difficult to introduce. First, there is a conflict between Indonesia’s commitment to reducing its GHG emissions and the national policy goals which focus on economic development. Second, business stakeholders play an influential role in preventing the government from introducing a carbon tax. Third, corrupt activities have had a negative impact on the effectiveness of climate policies Indonesia. This thesis also finds that there are three key conditions required for the effective introduction of a carbon tax in Indonesia. First, the commitment of the government to put climate policies onto the national policy agenda. Second, the introduction of complementary policies to reduce opposition from business stakeholders. And third, improvements to accountability and transparency.

This thesis is an original empirical study which makes an important contribution to the ever-growing academic debate on the introduction of carbon prices to assist climate mitigation efforts. It also has important ramifications in terms of transparency, accountability and political pluralism in Indonesia.

Keywords: carbon tax, climate policy, mitigation, grounded theory

Subject: Policy and Administration thesis

Thesis type: Doctor of Philosophy
Completed: 2020
School: College of Business, Government and Law
Supervisor: Associate Professor Cassandra Star