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Development Effects of Electrification: Evidence from the Topographic Placement of Hydropower Plants in Brazil

Molly Lipscomb (), Ahmed Mobarak () and Tania Barham

American Economic Journal: Applied Economics, 2013, vol. 5, issue 2, 200-231

Abstract: We estimate the development effects of electrification across Brazil over the period 1960-2000. We simulate a time series of hypothetical electricity grids for Brazil for the period 1960-2000 that show how the grid would have evolved had infrastructure investments been made based solely on geography-based cost considerations. Using the model as an instrument, we document large positive effects of electrification on development that are underestimated when one fails to account for endogenous targeting. Broad-based improvement in labor productivity across sectors and regions rather than general equilibrium re-sorting appears to be the likely mechanism by which these development gains are realized. (JEL H54, L94, O11, O13, Q41, Q43)

JEL-codes: H54 L94 O11 O13 Q41 Q43 (search for similar items in EconPapers)
Date: 2013
Note: DOI: 10.1257/app.5.2.200
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American Economic Journal: Applied Economics is currently edited by Alexandre Mas

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Handle: RePEc:aea:aejapp:v:5:y:2013:i:2:p:200-231