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Electrification, telecommunications, and the finance-growth nexus: Evidence from firm-level data

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  • Cotter, Christopher
  • Rousseau, Peter L.
  • Vu, Nam T.

Abstract

We explore variations in access to energy and telecommunications improvements across firms in 57 and 112 developing countries, respectively, between 2002 and 2014, and find that national investments in technological infrastructures provide a channel through which financial development promotes firm-level adoption of tangible innovations. In particular, when countries make large investments in their energy (electricity and natural gas) and telecommunications infrastructures, firms with greater access to financial resources are better positioned to benefit from these investments, experiencing significantly fewer power interruptions, more adoptions of power generators, and greater website use, all of which are related to higher firm-level growth in sales and employment.

Suggested Citation

  • Cotter, Christopher & Rousseau, Peter L. & Vu, Nam T., 2021. "Electrification, telecommunications, and the finance-growth nexus: Evidence from firm-level data," Energy Economics, Elsevier, vol. 94(C).
    • Handle: RePEc:eee:eneeco:v:94:y:2021:i:c:s0140988320304138
    DOI: 10.1016/j.eneco.2020.105073
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    More about this item

    Keywords

    Energy-finance-growth nexus; Electrification; IT; Infrastructure; Financial access; Power interruption;
    All these keywords.

    JEL classification:

    • E02 - Macroeconomics and Monetary Economics - - General - - - Institutions and the Macroeconomy
    • E6 - Macroeconomics and Monetary Economics - - Macroeconomic Policy, Macroeconomic Aspects of Public Finance, and General Outlook

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