NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH

How Do Electricity Shortages Affect Productivity? Evidence from India

Hunt Allcott, Allan Collard-Wexler, Stephen D. O'Connell

NBER Working Paper No. 19977
Issued in March 2014
NBER Program(s):   DEV   EEE   IO   PR

Endemic blackouts are a particularly salient example of how poor infrastructure might reduce growth in developing economies. As a case study, we analyze how Indian textile plants respond to weekly "power holidays." We then study how electricity shortages affect all Indian manufacturers, using an instrument based on hydroelectricity production and a hybrid Leontief/Cobb-Douglas production function model. Shortages reduce average output by about five percent, but because most inputs can be stored during outages, productivity losses are much smaller. Plants without generators have much larger losses, and because of economies of scale in generator capacity, shortages more severely affect small plants.

You may purchase this paper on-line in .pdf format from SSRN.com ($5) for electronic delivery.

Information about Free Papers

You should expect a free download if you are a subscriber, a corporate associate of the NBER, a journalist, an employee of the U.S. federal government with a ".GOV" domain name, or a resident of nearly any developing country or transition economy.

If you usually get free papers at work/university but do not at home, you can either connect to your work VPN or proxy (if any) or elect to have a link to the paper emailed to your work email address below. The email address must be connected to a subscribing college, university, or other subscribing institution. Gmail and other free email addresses will not have access.

E-mail:

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w19977

Users who downloaded this paper also downloaded these:
Jayaraman, Ray, and de Vericourt w19849 Productivity Response to a Contract Change
Anderson and Genicot w19978 Suicide and Property Rights in India
Wang and Whalley w19898 Are Chinese Markets for Manufactured Products More Competitive than in the US?: A Comparison of China -US Industrial Concentration Ratios
Imbens w19983 Instrumental Variables: An Econometrician's Perspective
Acemoglu, Gallego, and Robinson w19933 Institutions, Human Capital and Development
 
Publications
Activities
Meetings
NBER Videos
Data
People
About

Support
National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email: info@nber.org

Contact Us