Dorothée Boccanfuso () (GREDI, Faculte d'administration, Université de Sherbrooke) Antonio Estache () (World Bank and, the European Centre for Advanced Research in Economics and Statistics at the Free University of Brussels) Luc Savard () (GREDI, Faculte d'administration, Université de Sherbrooke)
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This paper uses a computable general equilibrium (CGE) microsimulation 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 analyze 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 microsimulation 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
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Paper provided by Departement d'Economique de la Faculte d'administration à l'Universite de Sherbrooke in its series Cahiers de recherche with number
07-10.
Find related papers by JEL classification: D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models D31 - Microeconomics - - Distribution - - - Personal Income and Wealth Distribution I32 - Health, Education, and Welfare - - Welfare and Poverty - - - Measurement and Analysis of Poverty L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Boundaries of Public and Private Enterprise; Privatization; Contracting Out L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation
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