Electrification and Socio-economic Differentiation in South Asia: Do Fiscal and Monetary Policies Matter?

Mohammad Mijanur Rahaman (), Md. Monirul Islam () and Sergei Nikolaevich Polbitsyn ()
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Mohammad Mijanur Rahaman: Ural Federal University (UrFU), Graduate School of Public Administration and Entrepreneurship
Md. Monirul Islam: Ural Federal University (UrFU), Graduate School of Economics and Management (GSEM)
Sergei Nikolaevich Polbitsyn: Ural Federal University (UrFU), Graduate School of Public Administration and Entrepreneurship

Journal of the Knowledge Economy, 2025, vol. 16, issue 6, No 32, 18290-18321

Abstract: Abstract Despite electrification’s challenges and opportunities, South Asia is undergoing significant shifts in electricity accessibility, affordability, and sustainability, propelled by effective public policies. This research investigates the impact of electrification on socio-economic differentiation, including economic growth, urbanization, and communication technologies development in South Asia from 1996 to 2023, within the scope of fiscal and monetary policies and governance. Using the pooled mean group (PMG) regression, the study uncovers a positive correlation between electrification and socio-economic differentiation determinants. Both fiscal and monetary policies are found to foster communication technology and economic growth in the short and long term. However, while fiscal policy does not significantly influence urbanization, monetary policy negatively impacts it. Governance, represented by government effectiveness, positively influences economic growth but does not significantly affect urbanization and technological proliferation. These findings remain robust across panel causality tests and quantiles via moments approaches. However, this study’s significance lies in formulating comprehensive policies to enhance government effectiveness, improve fiscal and monetary management, and catalyze electrification-based socio-economic transformation in South Asia.

Keywords: Socio-economic differentiation; Fiscal and monetary policies; Communication technology development; Governance; Pooled mean group; South Asia (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s13132-025-02613-z

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