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Firm Adaptation and Reallocation under Rationing: Evidence from South Africa

Author

Listed:
  • Rowan Clarke

    (Harvard Business School, Harvard University)

  • F. Christopher Eaglin

  • Zachary Kuloszewski

  • Jun Wong

Abstract

Rationing policies are frequently implemented due to equity concerns, yet whether equitable-exposure rules deliver equal economic impacts remains unclear. We study the 2021--2023 power crisis in South Africa, exploiting quasi-random variation in outage exposure and combining hour-level outage data with geocoded transactions from a leading payment platform. Although aggregate daily sales do not change on outage days, revenue is reallocated: below-median firms lose roughly eleven percent of daily revenue while above-median firms---able to invest in defensive technology---gain a similar share. These unequal effects are amplified when outages are anticipated, suggesting the impacts of rationing are not equal despite equitable exposure.

Suggested Citation

  • Rowan Clarke & F. Christopher Eaglin & Zachary Kuloszewski & Jun Wong, 2026. "Firm Adaptation and Reallocation under Rationing: Evidence from South Africa," ERSA Working Paper Series 298, Economic Research Southern Africa.
    • Handle: RePEc:rza:ersawp:298
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    File URL: https://ersawps.org/index.php/working-paper-series/article/view/298/200
    File Function: First version, 2026
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    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • D22 - Microeconomics - - Production and Organizations - - - Firm Behavior: Empirical Analysis
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa

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