IDEAS home Printed from https://ideas.repec.org/a/eee/exehis/v98y2025ics001449832500049x.html

Power for progress: The impact of electricity on individual labor market outcomes

Author

Listed:
  • Jayes, Jonathan
  • Molinder, Jakob
  • Enflo, Kerstin

Abstract

How does new technology impact labor market outcomes? We address this question by examining the adoption of electricity in Sweden during the early 20th century. Leveraging detailed individual-level data that covers the entire labor market and exogenous variation in electricity access driven by proximity to hydro-power plants, we estimate the impact of electrification on individual labor market outcomes. Our findings show significantly higher earnings in electricity-adopting parishes compared to control areas. The income gains were particularly pronounced among lower-income workers and those with primary education only, resulting in reduced income inequality. These effects held across labor markets with both strong and weak union presence, suggesting that electricity functioned as a labor-supporting technology. Our results highlight how specific technologies can shape individual outcomes and income distributions.

Suggested Citation

  • Jayes, Jonathan & Molinder, Jakob & Enflo, Kerstin, 2025. "Power for progress: The impact of electricity on individual labor market outcomes," Explorations in Economic History, Elsevier, vol. 98(C).
    • Handle: RePEc:eee:exehis:v:98:y:2025:i:c:s001449832500049x
    DOI: 10.1016/j.eeh.2025.101702
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S001449832500049X
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.eeh.2025.101702?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to look for a different version below or

    for a different version of it.

    Other versions of this item:

    References listed on IDEAS

    as
    1. Erik Brynjolfsson & Danielle Li & Lindsey Raymond, 2025. "Generative AI at Work," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 140(2), pages 889-942.
    2. Gaggl, Paul & Gray, Rowena & Marinescu, Ioana & Morin, Miguel, 2021. "Does electricity drive structural transformation? Evidence from the United States," Labour Economics, Elsevier, vol. 68(C).
    3. Rud, Juan Pablo, 2012. "Electricity provision and industrial development: Evidence from India," Journal of Development Economics, Elsevier, vol. 97(2), pages 352-367.
    4. 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.
    5. Shahidur R. Khandker & Hussain A. Samad & Rubaba Ali & Douglas F. Barnes, 2014. "Who Benefits Most from Rural Electrification? Evidence in India," The Energy Journal, , vol. 35(2), pages 75-96, April.
    6. Jovanovic, Boyan & Rousseau, Peter L., 2005. "General Purpose Technologies," Handbook of Economic Growth, in: Philippe Aghion & Steven Durlauf (ed.), Handbook of Economic Growth, edition 1, volume 1, chapter 18, pages 1181-1224, Elsevier.
    7. Kerstin Enflo & Tobias Karlsson, 2019. "From conflict to compromise: the importance of mediation in Swedish work stoppages 1907–1927," European Review of Economic History, European Historical Economics Society, vol. 23(3), pages 268-298.
    8. Daniela Vidart, 2024. "Human Capital, Female Employment, and Electricity: Evidence from the Early 20th-Century United States," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 91(1), pages 560-594.
    9. Lennart Schon & Olle Krantz, 2012. "The Swedish economy in the early modern period: constructing historical national accounts," European Review of Economic History, European Historical Economics Society, vol. 16(4), pages 529-549, November.
    10. Lewis, Joshua & Severnini, Edson, 2020. "Short- and long-run impacts of rural electrification: Evidence from the historical rollout of the U.S. power grid," Journal of Development Economics, Elsevier, vol. 143(C).
    11. Damron, Will, 2025. "Gains from factory electrification: Evidence from North Carolina, 1905–1926," Explorations in Economic History, Elsevier, vol. 96(C).
    12. Molly Lipscomb & A. Mushfiq Mobarak & Tania Barham, 2013. "Development Effects of Electrification: Evidence from the Topographic Placement of Hydropower Plants in Brazil," American Economic Journal: Applied Economics, American Economic Association, vol. 5(2), pages 200-231, April.
    13. Alexander J. Field, 2003. "The Most Technologically Progressive Decade of the Century," American Economic Review, American Economic Association, vol. 93(4), pages 1399-1413, September.
    14. Molinder, Jakob & Karlsson, Tobias & Enflo, Kerstin, 2022. "Social democracy and the decline of strikes," Explorations in Economic History, Elsevier, vol. 83(C).
    15. Michelle Alexopoulos & Jon Cohen, 2016. "The Medium Is the Measure: Technical Change and Employment, 1909—1949," The Review of Economics and Statistics, MIT Press, vol. 98(4), pages 792-810, October.
    16. repec:aen:journl:ej35-2-04 is not listed on IDEAS
    17. Molinder, Jakob & Karlsson, Tobias & Enflo, Kerstin, 2021. "More Power to the People: Electricity Adoption, Technological Change, and Labor Conflict," The Journal of Economic History, Cambridge University Press, vol. 81(2), pages 481-512, June.
    18. Kenneth Lee & Edward Miguel & Catherine Wolfram, 2020. "Does Household Electrification Supercharge Economic Development?," Journal of Economic Perspectives, American Economic Association, vol. 34(1), pages 122-144, Winter.
    19. Björn Brey, 2021. "The Long-run Gains from the Early Adoption of Electricity," Working Papers ECARES 2021-23, ULB -- Universite Libre de Bruxelles.
    20. Kitchens, Carl & Fishback, Price, 2015. "Flip the Switch: The Impact of the Rural Electrification Administration 1935–1940," The Journal of Economic History, Cambridge University Press, vol. 75(4), pages 1161-1195, December.
    21. David H. Autor & Lawrence F. Katz & Alan B. Krueger, 1998. "Computing Inequality: Have Computers Changed the Labor Market?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 113(4), pages 1169-1213.
    22. Leknes, Stefan & Modalsli, Jørgen, 2020. "Who Benefited from Industrialization? The Local Effects of Hydropower Technology Adoption in Norway," The Journal of Economic History, Cambridge University Press, vol. 80(1), pages 207-245, March.
    23. Enrico Moretti, 2014. "Local Economic Development, Agglomeration Economies, and the Big Push: 100 Years of Evidence from the Tennessee Valley Authority," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(1), pages 275-331.
    24. Khandker, Shahidur R. & Barnes, Douglas F. & Samad, Hussain A., 2009. "Welfare impacts of rural electrification : a case study from Bangladesh," Policy Research Working Paper Series 4859, The World Bank.
    25. Gray, Rowena, 2013. "Taking technology to task: The skill content of technological change in early twentieth century United States," Explorations in Economic History, Elsevier, vol. 50(3), pages 351-367.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Griffin, Míde & Lyons, Sean & Nolan, Anne, 2025. "Rural electrification and secondary school enrolments in Ireland," MPRA Paper 124216, University Library of Munich, Germany.
    2. Gaggl, Paul & Gray, Rowena & Marinescu, Ioana & Morin, Miguel, 2021. "Does electricity drive structural transformation? Evidence from the United States," Labour Economics, Elsevier, vol. 68(C).
    3. Daniela Vidart, 2024. "Human Capital, Female Employment, and Electricity: Evidence from the Early 20th-Century United States," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 91(1), pages 560-594.
    4. Maria Vagliasindi & Nisan Gorgulu, 2025. "Disentangling the Key Economic Channels through Which Infrastructure Affects Jobs," Policy Research Working Paper Series 11096, The World Bank.
    5. Björn Brey, 2021. "The Long-run Gains from the Early Adoption of Electricity," Working Papers ECARES 2021-23, ULB -- Universite Libre de Bruxelles.
    6. Robin Burgess & Michael Greenstone & Nicholas Ryan & Anant Sudarshan, 2020. "Demand for Electricity on the Global Electrification Frontier," Cowles Foundation Discussion Papers 2222, Cowles Foundation for Research in Economics, Yale University.
    7. Damron, Will, 2025. "Gains from factory electrification: Evidence from North Carolina, 1905–1926," Explorations in Economic History, Elsevier, vol. 96(C).
    8. Ly, Alpha & Chakir, Raja & Creti, Anna, 2024. "Electrification or deforestation? Evidence from household practices in Côte d’Ivoire," Energy Economics, Elsevier, vol. 136(C).
    9. Bo, Shiyu & Chen, Ting & Liu, Cong, 2022. "Trade shocks, industrial growth, and electrification in early 20th-century China," Journal of Comparative Economics, Elsevier, vol. 50(3), pages 732-749.
    10. Bhukta, Rikhia & Pakrashi, Debayan & Saha, Sarani & Sedai, Ashish, 2024. "Community electrification and women’s autonomy," Energy Economics, Elsevier, vol. 137(C).
    11. Kenneth Lee & Edward Miguel & Catherine Wolfram, 2020. "Does Household Electrification Supercharge Economic Development?," Journal of Economic Perspectives, American Economic Association, vol. 34(1), pages 122-144, Winter.
    12. Enflo, Kerstin & Molinder, Jakob & Karlsson, Tobias, 2019. "More Power to the People: Electricity Adoption, Technological Change and Social Conflict," CEPR Discussion Papers 13986, Centre for Economic Policy Research.
    13. Yang, Yeonbin, 2025. "Does Household Electrification Empower Rural Boys and Girls Alike? Evidence from Brazil," World Development, Elsevier, vol. 186(C).
    14. Meeks, Robyn C. & Thompson, Hope & Wang, Zhenxuan, 2025. "Decentralized renewable energy to grow manufacturing? Evidence from microhydro mini-grids in Nepal," Journal of Environmental Economics and Management, Elsevier, vol. 130(C).
    15. Lin, Tao & Qi, Minhao & Wei, Sijie & Chen, Zhao, 2024. "Welfare impacts of coal-fired power plants: Do economic benefits compensate health costs?," Economic Analysis and Policy, Elsevier, vol. 84(C), pages 1144-1163.
    16. Sergio Petralia, 2020. "GPTs and Growth: Evidence on the Technological Adoption of Electrical & Electronic Technologies in the 1920s," Papers in Evolutionary Economic Geography (PEEG) 2033, Utrecht University, Department of Human Geography and Spatial Planning, Group Economic Geography, revised Aug 2020.
    17. Andrea Xamo & Roberto Ricciuti, 2025. "Electricity and the Geography of Industrial Development in a Latecomer Country: Preliminary Evidence on Italy, 1901-1911," Working Papers 01/2025, University of Verona, Department of Economics.
    18. Thomas, Daniel Robert & Harish, S.P. & Kennedy, Ryan & Urpelainen, Johannes, 2020. "The effects of rural electrification in India: An instrumental variable approach at the household level," Journal of Development Economics, Elsevier, vol. 146(C).
    19. David Boisclair & Roxane Borgès Da Silva & Nathalie De Marcellis-Warin & Pierre-Carl Michaud & Ingrid Peignier, 2022. "Combien de personnes ont développé des symptômes ou contracté la Covid-19 au Québec ? Une étude exploratoire," CIRANO Working Papers 2022s-05, CIRANO.
    20. Bensch, Gunther & Gotz, Gunnar & Peters, Jörg, 2020. "Effects of rural electrification on employment: A comment on Dinkelman (2011)," Ruhr Economic Papers 840, RWI - Leibniz-Institut für Wirtschaftsforschung, Ruhr-University Bochum, TU Dortmund University, University of Duisburg-Essen.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    JEL classification:

    • N14 - Economic History - - Macroeconomics and Monetary Economics; Industrial Structure; Growth; Fluctuations - - - Europe: 1913-
    • N34 - Economic History - - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and Philanthropy - - - Europe: 1913-
    • N74 - Economic History - - Economic History: Transport, International and Domestic Trade, Energy, and Other Services - - - Europe: 1913-
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:exehis:v:98:y:2025:i:c:s001449832500049x. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/622830 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.