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Tracking economic fluctuations with electricity consumption in Bangladesh

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  • Arshad, Selvia
  • Beyer, Robert C.M.

Abstract

This paper establishes electricity consumption as an indicator for tracking economic fluctuations in Bangladesh. It presents monthly data on national electricity consumption since 1993 and subnational daily consumption data since February 2010. Electricity consumption is strongly correlated with other high-frequency indicators of economic activity, and it has declined during natural disasters and the COVID-19 lockdowns. The paper estimates an electricity consumption model that explains over 90% of the variation in daily consumption based on a quadratic trend, seasonality, within-week variation, national holidays, Ramadan, and temperature. Deviations from the model prediction can act as an indicator of subnational economic fluctuations. For example, electricity consumption in Dhaka fell around 40% below normal in April and May 2020 during the first COVID-19 lockdown and remained below normal afterwards. The later lockdowns, in contrast, had much smaller impacts, in line with less stringent containment measures and more effective adaptation.

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  • Arshad, Selvia & Beyer, Robert C.M., 2023. "Tracking economic fluctuations with electricity consumption in Bangladesh," Energy Economics, Elsevier, vol. 123(C).
    • Handle: RePEc:eee:eneeco:v:123:y:2023:i:c:s0140988323002384
    DOI: 10.1016/j.eneco.2023.106740
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    Cited by:

    1. Robert C. M. Beyer & Konstantin M. Wacker, 2024. "Good enough for outstanding growth: The experience of Bangladesh in comparative perspective," Development Policy Review, Overseas Development Institute, vol. 42(2), March.
    2. Abdullah, Mohammad & Abakah, Emmanuel Joel Aikins & Wali Ullah, G M & Tiwari, Aviral Kumar & Khan, Isma, 2023. "Tail risk contagion across electricity markets in crisis periods," Energy Economics, Elsevier, vol. 127(PB).
    3. Guglielmo Maria Caporale & Abdurrahman Nazif Çatık & Mohamad Husam Helmi & Coşkun Akdeniz & Ali İlhan, 2024. "Time-varying effects of the COVID-19 pandemic on stock markets and economic activity: evidence from the US and Europe," Empirica, Springer;Austrian Institute for Economic Research;Austrian Economic Association, vol. 51(2), pages 529-558, May.

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    More about this item

    Keywords

    Electricity consumption; Bangladesh; Economic fluctuations; COVID-19; Natural disasters;
    All these keywords.

    JEL classification:

    • E01 - Macroeconomics and Monetary Economics - - General - - - Measurement and Data on National Income and Product Accounts and Wealth; Environmental Accounts
    • E65 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook - - - Studies of Particular Policy Episodes
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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