IDEAS home Printed from https://ideas.repec.org/p/imf/imfwpa/2018-159.html
   My bibliography  Save this paper

Losing to Blackouts: Evidence from Firm Level Data

Author

Listed:
  • Daniel Gurara
  • Dawit Tessema

Abstract

Many developing economies are often hit by electricity crises either because of supply constraints or lacking in broader energy market reforms. This study uses manufacturing firm census data from Ethiopia to identify productivity losses attributable to power disruptions. Our estimates show that these disruptions, on average, result in productivity losses of about 4–10 percent. We found nonlinear productivity losses at different quantiles along the productivity distribution. Firms at higher quantiles faced higher losses compared to firms around the median. We observed patterns of systematic shutdowns as firms attempt to minimize losses.

Suggested Citation

  • Daniel Gurara & Dawit Tessema, 2018. "Losing to Blackouts: Evidence from Firm Level Data," IMF Working Papers 2018/159, International Monetary Fund.
    • Handle: RePEc:imf:imfwpa:2018/159
    as

    Download full text from publisher

    File URL: http://www.imf.org/external/pubs/cat/longres.aspx?sk=46032
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Kim, Kyoo il & Petrin, Amil & Song, Suyong, 2016. "Estimating production functions with control functions when capital is measured with error," Journal of Econometrics, Elsevier, vol. 190(2), pages 267-279.
    2. Durlauf, Steven N. & Quah, Danny T., 1999. "The new empirics of economic growth," Handbook of Macroeconomics, in: J. B. Taylor & M. Woodford (ed.), Handbook of Macroeconomics, edition 1, volume 1, chapter 4, pages 235-308, Elsevier.
    3. De loecker, Jan & Collard-Wexler, Allan, 2016. "Production Function Estimation with Measurement Error in Inputs," CEPR Discussion Papers 11399, C.E.P.R. Discussion Papers.
    4. Mensah,Justice Tei, 2018. "Jobs ! electricity shortages and unemployment in Africa," Policy Research Working Paper Series 8415, The World Bank.
    5. Ermias Engida & Eyasu Tsehaye & Seneshaw Tamru, 2011. "Does Electricity Supply Strategy Matter? Shortage and Investment:Reflections based on CGE Analysis," Working Papers 006, Policy Studies Institute.
    6. Fisher-Vanden, Karen & Mansur, Erin T. & Wang, Qiong (Juliana), 2015. "Electricity shortages and firm productivity: Evidence from China's industrial firms," Journal of Development Economics, Elsevier, vol. 114(C), pages 172-188.
    7. Steinbuks, J. & Foster, V., 2010. "When do firms generate? Evidence on in-house electricity supply in Africa," Energy Economics, Elsevier, vol. 32(3), pages 505-514, May.
    8. Admasu Shiferaw & M�ns S�derbom & Eyerusalem Siba & Getnet Alemu, 2015. "Road Infrastructure and Enterprise Dynamics in Ethiopia," Journal of Development Studies, Taylor & Francis Journals, vol. 51(11), pages 1541-1558, November.
    9. Ackerberg, Daniel & Lanier Benkard, C. & Berry, Steven & Pakes, Ariel, 2007. "Econometric Tools for Analyzing Market Outcomes," Handbook of Econometrics, in: J.J. Heckman & E.E. Leamer (ed.), Handbook of Econometrics, edition 1, volume 6, chapter 63, Elsevier.
    10. Blimpo,Moussa Pouguinimpo & Mensah,Justice Tei & Opalo,K. Ochieng? & Shi,Ruifan, 2018. "Electricity provision and tax mobilization in Africa," Policy Research Working Paper Series 8408, The World Bank.
    11. Allan Collard-Wexler & Jan De Loecker, 2016. "Production Function Estimation and Capital Measurement Error," NBER Working Papers 22437, National Bureau of Economic Research, Inc.
    12. Gabriele Rovigatti & Vincenzo Mollisi, 2016. "PRODEST: Stata module for production function estimation based on the control function approach," Statistical Software Components S458239, Boston College Department of Economics, revised 28 Jul 2020.
    13. Philippe Alby & Jean-Jacques Dethier & Stéphane Straub, 2013. "Firms Operating under Electricity Constraints in Developing Countries," The World Bank Economic Review, World Bank, vol. 27(1), pages 109-132.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Florian Morvillier, 2020. "Infrastructures and the real exchange rate," EconomiX Working Papers 2020-26, University of Paris Nanterre, EconomiX.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Justice Tei Mensah, 2016. "Bring Back Our Light: Power Outages and Industrial Performance in Sub-Saharan Africa," Working Papers 2016.20, FAERE - French Association of Environmental and Resource Economists.
    2. Yu, Jian & Liu, Peng & Fu, Dahai & Shi, Xunpeng, 2023. "How do power shortages affect CO2 emission intensity? Firm-level evidence from China," Energy, Elsevier, vol. 282(C).
    3. Cole, Matthew A. & Elliott, Robert J.R. & Occhiali, Giovanni & Strobl, Eric, 2018. "Power outages and firm performance in Sub-Saharan Africa," Journal of Development Economics, Elsevier, vol. 134(C), pages 150-159.
    4. Adewuyi, Adeolu & Emmanuel, Zachariah, 2018. "Electricity Outages and Firm Performance Across the Six Geo-Political Zones in Nigeria: The Role of Corruption," MPRA Paper 92091, University Library of Munich, Germany, revised 04 Feb 2019.
    5. Richter, Philipp M. & Schiersch, Alexander, 2017. "CO2 emission intensity and exporting: Evidence from firm-level data," European Economic Review, Elsevier, vol. 98(C), pages 373-391.
    6. repec:diw:diwwpp:dp1788 is not listed on IDEAS
    7. Adewuyi, Adeolu & Emmanuel, Zachariah, 2018. "Electricity Outages and Firm Performance Across the Six Geo-Political Zones in Nigeria: The Role of Corruption," MPRA Paper 92089, University Library of Munich, Germany, revised 03 Feb 2019.
    8. Simone Lenzu & Francesco Manaresi, 2019. "Sources and implications of resource misallocation: new evidence from firm-level marginal products and user costs," Questioni di Economia e Finanza (Occasional Papers) 485, Bank of Italy, Economic Research and International Relations Area.
    9. Mohammad Abir Shahid Chowdhury & Shuai Chuanmin & Marcela Sokolová & ABM Munibur Rahman & Ahsan Akbar & Zahid Ali & Muhammad Usman, 2021. "Unveiling the Nexus between Access to Electricity, Firm Size and SME’s Performance in Bangladesh: New Evidence Using PSM," Energies, MDPI, vol. 14(20), pages 1-16, October.
    10. World Bank Group, "undated". "Africa's Pulse, No. 17, April 2018," World Bank Publications - Reports 29667, The World Bank Group.
    11. Chapel, Capucine, 2022. "Impact of official development assistance projects for renewable energy on electrification in sub-Saharan Africa," World Development, Elsevier, vol. 152(C).
    12. Abiodun, Kehinde & Gilbert, Ben, 2022. "Does universal electrification shield firms from productivity loss?," World Development Perspectives, Elsevier, vol. 28(C).
    13. Martin Gornig & Alexander Schiersch, 2019. "Agglomeration Economies and the Firm TFP: Different Effects across Industries," Discussion Papers of DIW Berlin 1788, DIW Berlin, German Institute for Economic Research.
    14. Edwin Teye Sosi & Philip Akrofi Atitianti, 2021. "How constraining are electricity fluctuations to Ghanaian firms’ performance?," SN Business & Economics, Springer, vol. 1(11), pages 1-23, November.
    15. Francesco Manaresi & Nicola Pierri, 2018. "Credit supply and productivity growth," Temi di discussione (Economic working papers) 1168, Bank of Italy, Economic Research and International Relations Area.
    16. Abito, Jose Miguel, 2019. "Estimating Production Functions with Fixed Effects," MPRA Paper 97825, University Library of Munich, Germany.
    17. Francesco Manaresi & Nicola Pierri, 2018. "Credit supply and productivity growth," BIS Working Papers 711, Bank for International Settlements.
    18. Mensah, Justice Tei, 2016. "Bring Back our Light: Power Outages and Industrial Performance in Sub-Saharan Africa," 2016 Annual Meeting, July 31-August 2, Boston, Massachusetts 236587, Agricultural and Applied Economics Association.
    19. Florian Morvillier, 2020. "Infrastructures and the real exchange rate," EconomiX Working Papers 2020-26, University of Paris Nanterre, EconomiX.
    20. Francesco Manaresi & Mr. Nicola Pierri, 2019. "Credit Supply and Productivity Growth," IMF Working Papers 2019/107, International Monetary Fund.
    21. Matteo G. Richiardi & Luis Valenzuela, 2024. "Firm heterogeneity and the aggregate labour share," LABOUR, CEIS, vol. 38(1), pages 66-101, March.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:imf:imfwpa:2018/159. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Akshay Modi (email available below). General contact details of provider: https://edirc.repec.org/data/imfffus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.