How Do Electricity Shortages Affect Industry? Evidence from India
Publication
, Journal Article
Allcott, H; Collard-Wexler, A; O'Connell, SD
Published in: American Economic Review
March 2016
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)
Duke Scholars
Published In
American Economic Review
Publication Date
March 2016
Volume
106
Issue
3
Start / End Page
587 / 624
Related Subject Headings
- Economics
- 15 Commerce, Management, Tourism and Services
- 14 Economics
Citation
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Chicago
ICMJE
MLA
NLM
Allcott, H., Collard-Wexler, A., & O’Connell, S. D. (2016). How Do Electricity Shortages Affect Industry? Evidence from India. American Economic Review, 106(3), 587–624.
Allcott, Hunt, Allan Collard-Wexler, and Stephen D. O’Connell. “How Do Electricity Shortages Affect Industry? Evidence from India.” American Economic Review 106, no. 3 (March 2016): 587–624.
Allcott H, Collard-Wexler A, O’Connell SD. How Do Electricity Shortages Affect Industry? Evidence from India. American Economic Review. 2016 Mar;106(3):587–624.
Allcott, Hunt, et al. “How Do Electricity Shortages Affect Industry? Evidence from India.” American Economic Review, vol. 106, no. 3, Mar. 2016, pp. 587–624.
Allcott H, Collard-Wexler A, O’Connell SD. How Do Electricity Shortages Affect Industry? Evidence from India. American Economic Review. 2016 Mar;106(3):587–624.
Published In
American Economic Review
Publication Date
March 2016
Volume
106
Issue
3
Start / End Page
587 / 624
Related Subject Headings
- Economics
- 15 Commerce, Management, Tourism and Services
- 14 Economics