Losing to Blackouts: Evidence from Firm Level Data
46 Pages Posted: 22 Aug 2018
Date Written: July 2018
Abstract
Many developing economies are often hit by electricity crises either because of supplyconstraints or lacking in broader energy market reforms. This study uses manufacturingfirm census data from Ethiopia to identify productivity losses attributable to powerdisruptions. Our estimates show that these disruptions, on average, result in productivitylosses of about 4-10 percent. We found nonlinear productivity losses at different quantilesalong the productivity distribution. Firms at higher quantiles faced higher losses comparedto firms around the median. We observed patterns of systematic shutdowns as firmsattempt to minimize losses.
Keywords: Power disruption, Productivity loss, Shutdowns, Legal Monopolies and Regulation or Deregulation
JEL Classification: D24, E24, L43
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