Electricity provision and industrial development: Evidence from India

• 成果类型: Article
• 署名作者: Rud, Juan Pablo
• 署名单位: University of London
• 刊物名称: JOURNAL OF DEVELOPMENT ECONOMICS
• ISSN/ISSBN: 0304-3878
• DOI: 10.1016/j.jdeveco.2011.06.010
• 发表日期: 2012
• 页码: 352-367
• 关键词: development economics; electrification; infrastructure; instrumental variables

摘要

I investigate the effect of electricity provision on industrialization using a panel of Indian states for 1965-1984. To address the endogeneity of investment in electrification,! use the introduction of a new agricultural technology intensive in irrigation (the Green Revolution) as a natural experiment. As electric pumpsets are used to provide farmers with cheap irrigation water, I use the uneven availability of groundwater at the start of the Green Revolution to predict divergence in the expansion of the electricity network and, ultimately, to quantify the effect of electrification on industrial outcomes. I present a series of tests to show that the electrification channel remains the most important one among alternative explanations that could link groundwater availability to industrialization directly or indirectly. Results show that an increase in one standard deviation in the measure of electrification is associated with an increase of around 14% in manufacturing output for a state at the mean of the distribution. (C) 2011 Elsevier BM. All rights reserved.