ACDE seminar: Are the benefits of electrification realized only in the long run? Evidence from rural India

Professor David Stern will discuss the benefits of electrification.

Experimental studies typically find smaller benefits of electrification than do observational studies. Is this because the latter typically observe benefits after a longer period of time? Using three waves of data on rural households from the Human Development Profile of India and the Indian Household Development Survey of Indian, we quantify the impacts of short-term (0-7 years) and long-term (7-17 years) electricity access on household well-being. We use a propensity-score-weighted-difference-in-differences design that controls for spillover effects and find that electricity access increases consumption and education in the long term, and reduces the time spent by women on fuel collection, although we do not find significant effects on agricultural income, agricultural land holding, and kerosene consumption. Per capita consumption grows by 18 percentage points more over seven years in the long-term connected group than in the control group. Short-term effects are smaller and not statistically significant for any outcome variable.