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

Author

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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.

Suggested Citation

  • Dorothée Boccanfuso & Antonio Estache & Luc Savard, 2009. "Electricity Reforms In Mali: A Macro-Micro Analysis Of The Effects On Poverty And Distribution," South African Journal of Economics, Economic Society of South Africa, vol. 77(1), pages 127-147, March.
  • Handle: RePEc:bla:sajeco:v:77:y:2009:i:1:p:127-147
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Taesik Yun & Gyeong Lyeob Cho & Jang-Yeop Kim, 2016. "Analyzing Economic Effects with Energy Mix Changes: A Hybrid CGE Model Approach," Sustainability, MDPI, Open Access Journal, vol. 8(10), pages 1-18, October.
    2. Tooraj Jamasb & Rabindra Nepal & Govinda Timilsina & Michael Toman, 2014. "Energy Sector Reform, Economic Efficiency and Poverty Reduction," Discussion Papers Series 529, School of Economics, University of Queensland, Australia.
    3. Jamasb,Tooraj & Nepal,Rabindra & Timilsina,Govinda R., 2015. "A quarter century effort yet to come of age : a survey of power sector reforms in developing countries," Policy Research Working Paper Series 7330, The World Bank.
    4. Verikios, George & Zhang, Xiao-guang, 2015. "Reform of Australian urban transport: A CGE-microsimulation analysis of the effects on income distribution," Economic Modelling, Elsevier, vol. 44(C), pages 7-17.
    5. 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 l'École de gestion à l'Université de Sherbrooke.
    6. repec:eee:rensus:v:74:y:2017:i:c:p:1189-1209 is not listed on IDEAS
    7. Briceno-Garmendia, Cecilia & Shkaratan, Maria, 2011. "Power tariffs : caught between cost recovery and affordability," Policy Research Working Paper Series 5904, The World Bank.
    8. 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.

    More about this item

    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, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • L33 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Comparison of Public and Private Enterprise and Nonprofit Institutions; Privatization; Contracting Out
    • L93 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Air Transportation

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