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The Effects of Rural Electrification on Employment: New Evidence from South Africa

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  • Taryn Dinkelman

Abstract

This paper estimates the impact of electrification on employment growth by analyzing South Africa's mass roll-out of electricity to rural households. Using several new data sources and two different identification strategies (an instrumental variables strategy and a fixed effects approach), I find that electrification significantly raises female employment within five years. This new infrastructure appears to increase hours of work for men and women, while reducing female wages and increasing male earnings. Several pieces of evidence suggest that household electrification raises employment by releasing women from home production and enabling microenterprises. Migration behavior may also be affected. (JEL H54, L94, L98, O15, O18, R23)

Suggested Citation

  • Taryn Dinkelman, 2011. "The Effects of Rural Electrification on Employment: New Evidence from South Africa," American Economic Review, American Economic Association, vol. 101(7), pages 3078-3108, December.
  • Handle: RePEc:aea:aecrev:v:101:y:2011:i:7:p:3078-3108
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    References listed on IDEAS

    as
    1. Martha J. Bailey & William J. Collins, 2011. "Did Improvements in Household Technology Cause the Baby Boom? Evidence from Electrification, Appliance Diffusion, and the Amish," American Economic Journal: Macroeconomics, American Economic Association, vol. 3(2), pages 189-217, April.
    2. Abhijit Banerjee & Sebastian Galiani & Jim Levinsohn & Zoë McLaren & Ingrid Woolard, 2008. "Why has unemployment risen in the New South Africa?," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 16(4), pages 715-740, October.
    3. Coen-Pirani, Daniele & León, Alexis & Lugauer, Steven, 2010. "The effect of household appliances on female labor force participation: Evidence from microdata," Labour Economics, Elsevier, vol. 17(3), pages 503-513, June.
    4. Nathan Nunn & Diego Puga, 2012. "Ruggedness: The Blessing of Bad Geography in Africa," The Review of Economics and Statistics, MIT Press, vol. 94(1), pages 20-36, February.
    5. Aschauer, David Alan, 1989. "Is public expenditure productive?," Journal of Monetary Economics, Elsevier, vol. 23(2), pages 177-200, March.
    6. Victoria Hosegood & Anne Case & Cally Ardington, 2009. "Labor Supply Responses to Large Social Transfers: Longitudinal Evidence from South Africa," American Economic Journal: Applied Economics, American Economic Association, vol. 1(1), pages 22-48, January.
    7. Matias D. Cattaneo & Sebastian Galiani & Paul J. Gertler & Sebastian Martinez & Rocio Titiunik, 2009. "Housing, Health, and Happiness," American Economic Journal: Economic Policy, American Economic Association, vol. 1(1), pages 75-105, February.
    8. Fedderke, J.W. & Bogetic, Z., 2009. "Infrastructure and Growth in South Africa: Direct and Indirect Productivity Impacts of 19 Infrastructure Measures," World Development, Elsevier, vol. 37(9), pages 1522-1539, September.
    9. Michael Lokshin & Ruslan Yemtsov, 2005. "Has Rural Infrastructure Rehabilitation in Georgia Helped the Poor?," World Bank Economic Review, World Bank Group, vol. 19(2), pages 311-333.
    10. Akee, Randall K. Q., 2006. "The Babeldaob Road: The Impact of Road Construction on Rural Labor Force Outcomes in the Republic of Palau," IZA Discussion Papers 2452, Institute for the Study of Labor (IZA).
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    More about this item

    JEL classification:

    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • L98 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Government Policy
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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