Can Multinational Enterprises Light Up Developing Countries? MNEs and Access to Electricity in Sub-Saharan Africa

44 Pages Posted: 2 Sep 2015

See all articles by Matilde D'Amelio

Matilde D'Amelio

Polytechnic University of Milan - Department of Management, Economics and Industrial Engineering

Paola Garrone

Politecnico di Milano

Lucia Piscitello

Politecnico di Milano - Dipartimento di Ingegneria gestionale

Date Written: August 31, 2015

Abstract

Access to electricity is a marker for development but it is far from being universal in developing countries. In this context, multinational enterprises (MNEs) could play a role, especially if the country suffers from institutional voids. Using a panel of 1500 home-host country pairs, observed from 2005 to 2011, we show that MNEs promote access to electricity by deploying electricity infrastructures. This is more likely true if they come from institutionally weak environments. Thus, electricity infrastructures are not only essential for their business activities but they can be used as a legitimation mechanism to overcome their liability of origin.

Keywords: FDI, instiutional void, legitimacy, collective good, developing country, infrastructure

JEL Classification: F23, O10, H54, Q43

Suggested Citation

D'Amelio, Matilde and Garrone, Paola and Piscitello, Lucia, Can Multinational Enterprises Light Up Developing Countries? MNEs and Access to Electricity in Sub-Saharan Africa (August 31, 2015). Available at SSRN: https://ssrn.com/abstract=2653655

Matilde D'Amelio (Contact Author)

Polytechnic University of Milan - Department of Management, Economics and Industrial Engineering ( email )

Via Lambruschini 4C - building 26/A
Milano, 20156
Italy

Paola Garrone

Politecnico di Milano ( email )

piazza Leonardo da Vinci 32
Milano, 20133
Italy
+39-02-23992742 (Phone)

Lucia Piscitello

Politecnico di Milano - Dipartimento di Ingegneria gestionale ( email )

20113 Milan, Milano
Italy

HOME PAGE: http://www.dig.polimi.it/eng/comunita/cl.php?id=51

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