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Power outages and economic growth in Africa

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Abstract

This paper estimates the total effect of power outages on economic growth in Sub-Saharan Africa over the period 1995-2007. Outages are instrumented using a satellite-based measure of lightning density. As suggested by Henderson et al. (2011), we also combine Penn World Tables GDP data with satellite-based data on nightlights to arrive at a more accurate measure of economic growth. Our results suggest that the annual economic growth drag of a weak power infrastructure is about 2 percentage points.

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  • Andersen, Thomas Barnebeck & Dalgaard, Carl-Johan, 2012. "Power outages and economic growth in Africa," Discussion Papers of Business and Economics 7/2012, University of Southern Denmark, Department of Business and Economics.
  • Handle: RePEc:hhs:sdueko:2012_007
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    2. Thomas Barnebeck Andersen & Jeanet Bentzen & Carl-Johan Dalgaard & Pablo Selaya, 2012. "Lightning, IT Diffusion, and Economic Growth Across U.S. States," The Review of Economics and Statistics, MIT Press, vol. 94(4), pages 903-924, November.
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    Cited by:

    1. Christopher Ksoll & Kristine Bos & Arif Mamun & Anthony Harris & Sarah Hughes, "undated". "Evaluation Design Report for the Benin Power Compact's Electricity Generation Project and Electricity Distribution Project," Mathematica Policy Research Reports 9f8974513ee745aaac3b5c62e, Mathematica Policy Research.
    2. Abdisa, Lamessa T., 2018. "Power outages, economic cost, and firm performance: Evidence from Ethiopia," Utilities Policy, Elsevier, vol. 53(C), pages 111-120.
    3. Co, Catherine Y., 2014. "Supply-side constraints, capital goods imports, and the quality of Sub-Saharan African countries exports," WIDER Working Paper Series 142, World Institute for Development Economic Research (UNU-WIDER).
    4. Ben Ammar, Semir & Eling, Martin, 2015. "Common risk factors of infrastructure investments," Energy Economics, Elsevier, vol. 49(C), pages 257-273.
    5. Agenor, Pierre-Richard & Dinh, Hinh, 2013. "From Imitation to Innovation: Public Policy for Industrial Transformation," World Bank - Economic Premise, The World Bank, issue 115, pages 1-8, May.
    6. Best, Rohan & Burke, Paul J., 2018. "Electricity availability: A precondition for faster economic growth?," Energy Economics, Elsevier, vol. 74(C), pages 321-329.
    7. Biancone, Paolo Pietro & Radwan, Maha, 2018. "Sharia-Compliant financing for public utility infrastructure," Utilities Policy, Elsevier, vol. 52(C), pages 88-94.
    8. Agénor, Pierre-Richard, 2016. "Optimal fiscal management of commodity price shocks," Journal of Development Economics, Elsevier, vol. 122(C), pages 183-196.
    9. Heggie, Alastair & Eager, Dan & McKinnon, Ken & Van Der Weijde, Adriaan H., 2018. "Power rationing in a long-term power shortage," Energy Policy, Elsevier, vol. 121(C), pages 202-210.
    10. Carlsson, Fredrik & Demeke, Eyoual & Martinsson, Peter & Tesemma, Tewodros, 2018. "Cost of Power Outages for Manufacturing Firms in Ethiopia: A Stated Preference Study," Working Papers in Economics 731, University of Gothenburg, Department of Economics.
    11. Pless, Jacquelyn & Fell, Harrison, 2017. "Bribes, bureaucracies, and blackouts: Towards understanding how corruption at the firm level impacts electricity reliability," Resource and Energy Economics, Elsevier, vol. 47(C), pages 36-55.
    12. Oseni, Musiliu O. & Pollitt, Michael G., 2015. "A firm-level analysis of outage loss differentials and self-generation: Evidence from African business enterprises," Energy Economics, Elsevier, vol. 52(PB), pages 277-286.
    13. Grainger, Corbett A. & Zhang, Fan, 2019. "Electricity shortages and manufacturing productivity in Pakistan," Energy Policy, Elsevier, vol. 132(C), pages 1000-1008.
    14. Arouri, Mohamed El Hedi & Ben Youssef, Adel & M'henni, Hatem & Rault, Christophe, 2014. "Exploring the Causality Links between Energy and Employment in African Countries," IZA Discussion Papers 8296, Institute of Labor Economics (IZA).
    15. Thomas Barnebeck Andersen & Peter Sandholt Jensen, 2014. "Is Africa's Recent Growth Sustainable?," International Economic Journal, Taylor & Francis Journals, vol. 28(2), pages 207-223, June.
    16. Kashi, Bahman, 2015. "Risk management and the stated investment costs by independent power producers," Energy Economics, Elsevier, vol. 49(C), pages 660-668.
    17. Bahman Kashi, 2014. "Risk Management and the Stated Capital Costs by Independent Power Producers," Development Discussion Papers 2014-03, JDI Executive Programs.
    18. Hartvigsson, Elias & Stadler, Michael & Cardoso, Gonçalo, 2018. "Rural electrification and capacity expansion with an integrated modeling approach," Renewable Energy, Elsevier, vol. 115(C), pages 509-520.
    19. Agenor, Pierre-Richard & Dinh, Hinh T., 2013. "Public policy and industrial transformation in the process of development," Policy Research Working Paper Series 6405, The World Bank.
    20. Zemo, Kahsay Haile & Kassahun, Habtamu Tilahun & Olsen, Søren Bøye, 2019. "Determinants of willingness-to-pay for attributes of power outage - An empirical discrete choice experiment addressing implications for fuel switching in developing countries," Energy, Elsevier, vol. 174(C), pages 206-215.
    21. Duncan Chaplin & Delia Welsh & Arif Mamun & Nick Ingwersen & Kristine Bos & Erin Crossett & Poonam Ravindranath & Dara Bernstein & William Derbyshire, "undated". "Ghana Power Compact: Evaluation Design Report," Mathematica Policy Research Reports 8c1896c6f9af45f08347287c1, Mathematica Policy Research.
    22. Salahodjaev, Raufhon, 2017. "Government size, intelligence and life satisfaction," MPRA Paper 76902, University Library of Munich, Germany.
    23. Falentina, Anna T. & Resosudarmo, Budy P., 2019. "The impact of blackouts on the performance of micro and small enterprises: Evidence from Indonesia," World Development, Elsevier, vol. 124(C), pages 1-1.
    24. repec:ipg:wpaper:2014-475 is not listed on IDEAS
    25. Paul Bertheau & Ayobami Solomon Oyewo & Catherina Cader & Christian Breyer & Philipp Blechinger, 2017. "Visualizing National Electrification Scenarios for Sub-Saharan African Countries," Energies, MDPI, Open Access Journal, vol. 10(11), pages 1-20, November.

    More about this item

    Keywords

    Economic growth; public utilities; electricity; earthlights; Africa;

    JEL classification:

    • H40 - Public Economics - - Publicly Provided Goods - - - General
    • O10 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - General
    • O40 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - General

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