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Economics of household technology adoption in developing countries: Evidence from solar technology adoption in rural India

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  • Aklin, M.
  • Bayer, P.
  • Harish, S.P.
  • Urpelainen, J.

Abstract

Innovation is one of the most important drivers of economic development. Even in developing countries, households have access to a wide array of new technologies. However, factors affecting households' technology adoption decisions remain poorly understood. Using data on solar microgrid adoption from rural India, we investigate the determinants of household technology adoption. We offer all households identical solar products to avoid bias from product differentiation. Households pay a monthly fee for technology use, allowing us to abstract away from credit constraints as a barrier to adoption. The results show that household expenditures and savings as well as the household head's entrepreneurial attitude are strong predictors of adoption. In contrast, past fuel expenditures, risk acceptance, and community trust are not associated with technology adoption decisions. These findings suggest new directions for research on the microeconomics of household technology adoption, which is critical for sustainable development among the poor in developing countries.

Suggested Citation

  • Aklin, M. & Bayer, P. & Harish, S.P. & Urpelainen, J., 2018. "Economics of household technology adoption in developing countries: Evidence from solar technology adoption in rural India," Energy Economics, Elsevier, vol. 72(C), pages 35-46.
    • Handle: RePEc:eee:eneeco:v:72:y:2018:i:c:p:35-46
    DOI: 10.1016/j.eneco.2018.02.011
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    6. Richard S. J. Tol, 2023. "Navigating the energy trilemma during geopolitical and environmental crises," Papers 2301.07671, arXiv.org.
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    8. Robin Burgess & Michael Greenstone & Nicholas Ryan & Anant Sudarshan, 2020. "Demand for Electricity on the Global Electrification Frontier," Cowles Foundation Discussion Papers 2222, Cowles Foundation for Research in Economics, Yale University.
    9. Beyene, Abebe D. & Mekonnen, Alemu & Jeuland, Marc & Czakon, Sebastian, 2024. "Socioeconomic impacts of solar home systems in rural Ethiopia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 192(C).
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    17. Yunis Ali Ahmed & Ammar Rashid & Muhammad Mahboob Khurshid, 2022. "Investigating the Determinants of the Adoption of Solar Photovoltaic Systems—Citizen’s Perspectives of Two Developing Countries," Sustainability, MDPI, vol. 14(18), pages 1-25, September.
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    More about this item

    Keywords

    Technology adoption; Solar microgrids; Household model; Entrepreneurial spirit;
    All these keywords.

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q55 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Technological Innovation
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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