Rural electrification and changes in employment structure in Cambodia

This study analyzes the effects of electrification on the employment structure in Cambodia, which is still in its early stages of electrification and structural change. We examine the movement out of agriculture through three categories of nonagricultural employment: self-employment, wage employment, and unpaid work. To mitigate the problem of non-random placement of electricity, the inverse probability of treatment weighting regression adjustment (IPWRA) method is used to conduct two estimations, one with individual-level repeated cross-section data and the other with district-level panel data, taking advantage of a large and representative sample from the Cambodia General Population Census in 1998 and 2008. Our study finds that the labor movement away from agriculture is dominated by an increase in nonagricultural self-employment activities. Access to electricity increases the probability of nonagricultural self-employment for both men and women by 10–11 percentage points over a decade. We also confirm the existence of small external effects of electrification in rural Cambodia, possibly due to low electrification rates among rural households.