How Do Electricity Shortages Affect Industry? Evidence from India

• 成果类型: Article
• 署名作者: Allcott, Hunt; Collard-Wexler, Allan; O'Connell, Stephen D.
• 署名单位: New York University; National Bureau of Economic Research; Duke University; City University of New York (CUNY) System
• 刊物名称: AMERICAN ECONOMIC REVIEW
• ISSN/ISSBN: 0002-8282
• DOI: 10.1257/aer.20140389
• 发表日期: 2016
• 页码: 587-624
• 关键词: economic-development; infrastructure; PRODUCTIVITY; plants; FIRMS; electrification; TECHNOLOGY; countries; weather; QUALITY

摘要

We estimate the effects of electricity shortages on Indian manufacturers, instrumenting with supply shifts from hydroelectric power availability. We estimate that India's average reported level of shortages reduces the average plant's revenues and producer surplus by 5 to 10 percent, but average productivity losses are significantly smaller because most inputs can be stored during outages. Shortages distort the plant size distribution, as there are significant economies of scale in generator costs and shortages more severely affect plants without generators. Simulations show that offering interruptible retail electricity contracts could substantially reduce the impacts of shortages.