Publication: The Impact of Electricity Shortages on Firm Productivity: Evidence from Pakistan
Grainger, Corbett A.
Power shortages present a significant challenge to manufacturers, who rely on power as a key input to production. In Pakistan, power shortages are commonplace, but empirical evidence on the impact of shortages is still lacking. Using a survey of 4,500 manufacturing firms for the year 2010-11, this paper estimates the impact of electricity shortages on firm productivity in Pakistan. The analysis finds that a 10 percent increase in the duration of outages on average leads to a 0.14 percent decrease in a firm's total revenue and a 0.36 percent decrease in the value added, all else being equal. There is heterogeneity in the impacts of shortages across sectors: the industries that are most energy-intensive, such as manufacturers of metal, wood, and paper, are affected the most severely by shortages.
“Grainger, Corbett A.; Zhang, Fan. 2017. The Impact of Electricity Shortages on Firm Productivity; The Impact of Electricity Shortages on Firm Productivity: Evidence from Pakistan : Evidence from Pakistan. Policy Research Working Paper;No. 8130. © World Bank, Washington, DC. http://openknowledge.worldbank.org/handle/10986/27633?show=full License: CC BY 3.0 IGO.”
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