Does (better) electricity supply increase household enterprise income in India?

Narasimha D. Rao

Energy Policy, 2013, vol. 57, issue C, 532-541

Abstract: Electricity access is an important driver of economic development. Previous studies treat electrification as a binary outcome. In reality, in developing countries households with access face chronic supply interruptions, which can last up to 12h a day. This is the first study to estimate the income differences in urban and rural non-farm enterprises in Indian households with different levels of electricity supply, using a subset of 8125 households in the India Human and Development Survey, a cross-sectional national sample of 41,554 households. I use multiple econometric approaches, including linear regression with an instrument variable and propensity-score matching with multiple treatment levels to represent supply availability. I find a robust income effect of access, and suggestive evidence of the effect of better supply availability. The aggregate income impact across existing NFEs in India of improving supply to 16 h a day could be on the order of 0.1 percent of GDP.

Keywords: Energy poverty; Electricity reliability; Development (search for similar items in EconPapers)
Date: 2013
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Citations: View citations in EconPapers (34)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:57:y:2013:i:c:p:532-541

DOI: 10.1016/j.enpol.2013.02.025

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