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Growing Pains: The Unequal Costs of Infrastructure Modernization

Author

Listed:
  • Meera Mahadevan
  • Ryan McCord
  • Robyn Meeks
  • Manisha Pradhananga

Abstract

When governments modernize infrastructure to a common standard, do households receiving the largest implicit upgrades benefit most? We study a Nepal electricity modernization rollout that installed smart meters and raised connection capacity to enable greater use of electricity. We find that treated households reported more reliable electricity and billed use rose 5 percent on average. However, households receiving the largest upgrades, who had lower expenditures and fewer appliances at baseline, showed no increase in use while their bills rose 19 percent and late payments increased. Households already at the standard increased use without comparable payment strain, benefiting from increased reliability.

Suggested Citation

  • Meera Mahadevan & Ryan McCord & Robyn Meeks & Manisha Pradhananga, 2026. "Growing Pains: The Unequal Costs of Infrastructure Modernization," CESifo Working Paper Series 13093, CESifo.
    • Handle: RePEc:ces:ceswps:_13093
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    Keywords

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    JEL classification:

    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • P48 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Legal Institutions; Property Rights; Natural Resources; Energy; Environment; Regional Studies
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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