Flickering lifelines: Electrification and household welfare in India

Ashish Kumar Sedai, Rabindra Nepal and Tooraj Jamasb

Energy Economics, 2021, vol. 94, issue C

Abstract: This study moves beyond counting electrified households as the policy consensus on electrification and examines the effect of reliability of electricity on household's welfare in India. We analyse two household surveys covering the period from 2005 to 2018, and examine the effect of additional hours of electricity using panel fixed effects instrumental variables regressions. We focus on the intensive margins of deficiency, i.e. how additional hours of electricity in a day affects household's consumption expenditure, income, amenities, assets, borrowing and the status of poverty among others. Results show significant effects of an additional hour of electricity overall, especially among the poor households in rural India. The findings are robust to alternative ways of measuring household income, the use of alternative datasets to measure the effects on reliable electrification, as well as other robustness checks. The study recommends progressive pricing with targeted subsidies for the electrified households to increase household welfare while reducing the financial losses of the State Electricity Boards.

Keywords: Reliable electricity; Electrification; Household welfare; Panel fixed effects; Instrumental variables approach (search for similar items in EconPapers)
JEL-codes: D12 D31 E2 I32 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (14)

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Working Paper: Flickering lifelines: Electrification and household welfare in India (2020)
Working Paper: Flickering Lifelines: Electrification and Household Welfare in India (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:94:y:2021:i:c:s0140988320303157

DOI: 10.1016/j.eneco.2020.104975

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