Is electrification welfare improving?: non-experimental evidence from rural Bhutan

Santosh Kumar and Ganesh Rauniyar
Authors registered in the RePEc Author Service: Santosh Kumar Gautam

MPRA Paper from University Library of Munich, Germany

Abstract: This paper investigates the income and educational impacts of a large village-based electrification program in rural Bhutan. We designed and administered a household and village-level socio-economic survey in the electrified and non-electrified villages and collected data on wide range of developmental outcomes. Using Propensity Score Matching (PSM) and propensity-based weighted regression, we find that access to electricity improved economic and educational outcomes. While access to electricity increased non-farm income by 60-70%, and it had no significant effect on farm-income. Since non- farm income consists of a small percentage of total household income, the impact should be considered modest and not large. We also nd that children in electrified households have 0.75 additional years of schooling, an increase of about 24%. Additionally, amount of evening study time at home is 10 minutes more for the children in the treated households compared to untreated households. We employed different matching algorithms and our results are consistent and robust to all matching estimator. Our study contributes to the few studies on infrastructure literature which has often been focused on transport, telecom, and water projects. Given the limited use of electricity for income-generating activities in Bhutan, investments in other complementary infrastructure, such as, markets, roads, information technology, credit may help the households to realize the full benefits of electrification.

Keywords: Rural Electrification; Development Effectiveness; Asian Development Bank; Impct Evaluation; South-east Asia; Bhutan. (search for similar items in EconPapers)
JEL-codes: N75 O18 O20 (search for similar items in EconPapers)
Date: 2011-02-20
New Economics Papers: this item is included in nep-ene and nep-sea
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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