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Electricity Reforms In Mali: A Macro-Micro Analysis Of The Effects On Poverty And Distribution

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  • Dorothée Boccanfuso
  • Antonio Estache
  • Luc Savard

Abstract

This paper uses a computable general equilibrium (CGE) micro-simulation model to explore the distributional and poverty-related effects of price reform in the electricity sector of Mali, a poor country in West Africa. In the first part of the paper we analyse the distribution of electricity in Mali by income deciles, showing that few poor households are connected to the electricity grid. We then apply a sequential CGE micro-simulation model to track the transmission mechanisms between increases in electricity prices and changes in poverty and inequality among different household groups. Our results show that direct price increases have a minimal effect on poverty and inequality, whereas the general equilibrium effects of such increases are quite strong and negative. The compensating policies we tested do not help those who lose from the pricing reform. In fact they amplify the negative effects. Copyright (c) 2009 The Authors. Journal compilation (c) 2009 Economic Society of South Africa.

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Bibliographic Info

Article provided by Economic Society of South Africa in its journal South African Journal of Economics.

Volume (Year): 77 (2009)
Issue (Month): 1 (03)
Pages: 127-147

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Handle: RePEc:bla:sajeco:v:77:y:2009:i:1:p:127-147

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Cited by:
  1. Dorothée Boccanfuso & Antonio Estache & Luc Savard, 2007. "Electricity Reforms in Senegal: A Macro–Micro Analysis of the Effects on Poverty and Distribution," Cahiers de recherche 07-12, Departement d'Economique de la Faculte d'administration à l'Universite de Sherbrooke.
  2. Briceno-Garmendia, Cecilia & Shkaratan, Maria, 2011. "Power tariffs : caught between cost recovery and affordability," Policy Research Working Paper Series 5904, The World Bank.
  3. Verikios, George & Zhang, Xiao-guang, 2013. "Structural change in the Australian electricity industry during the 1990s and the effect on household income distribution: A macro–micro approach," Economic Modelling, Elsevier, vol. 32(C), pages 564-575.

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