Who Benefits Most from Rural Electrification? Evidence in India

This paper applies an econometric
analysis to estimate the average and distribution benefits
of rural electrification using rich household survey data
from India. The results support that rural electrification
helps to reduce time allocated to fuelwood collection by
household members and increases time allocated to studying
by boys and girls. Rural electrification also increases the
labor supply of men and women, schooling of boys and girls,
and household per capita income and expenditure.
Electrification also helps reduce poverty. But the larger
share of benefits accrues to wealthier rural households,
with poorer ones having more limited use of electricity. The
analysis also shows that restricted supply of electricity,
due to frequent power outages, negatively affects both
household electricity connection and its consumption,
thereby reducing the expected benefits of rural electrification.