Back to Search
Start Over
How Do Electricity Shortages Affect Industry? Evidence from India†.
- Source :
- American Economic Review; Mar2016, Vol. 106 Issue 3, p587-624, 38p, 9 Charts, 5 Graphs
- Publication Year :
- 2016
-
Abstract
- 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. (JEL D24, L60, L94, O13, O14, Q41) [ABSTRACT FROM AUTHOR]
Details
- Language :
- English
- ISSN :
- 00028282
- Volume :
- 106
- Issue :
- 3
- Database :
- Complementary Index
- Journal :
- American Economic Review
- Publication Type :
- Academic Journal
- Accession number :
- 113393584
- Full Text :
- https://doi.org/10.1257/aer.20140389