IMF Working Papers

Losing to Blackouts: Evidence from Firm Level Data

By Daniel Gurara, Dawit Tessema

July 10, 2018

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Daniel Gurara, and Dawit Tessema. Losing to Blackouts: Evidence from Firm Level Data, (USA: International Monetary Fund, 2018) accessed November 5, 2024

Disclaimer: IMF Working Papers describe research in progress by the author(s) and are published to elicit comments and to encourage debate. The views expressed in IMF Working Papers are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary

Many developing economies are often hit by electricity crises either because of supply constraints or lacking in broader energy market reforms. This study uses manufacturing firm census data from Ethiopia to identify productivity losses attributable to power disruptions. Our estimates show that these disruptions, on average, result in productivity losses of about 4–10 percent. We found nonlinear productivity losses at different quantiles along the productivity distribution. Firms at higher quantiles faced higher losses compared to firms around the median. We observed patterns of systematic shutdowns as firms attempt to minimize losses.

Subject: Capacity utilization, Commodities, Electricity, Labor productivity, Production, Productivity, Total factor productivity

Keywords: Africa, Capacity utilization, Electricity, Firm age, Firms shutdown, Grid-power consumption, Labor productivity, Panel data, Power disruption, Production function, Productivity, Productivity loss, Productivity shock, Shutdowns, State utility company, Sub-Saharan Africa, Time index, Total factor productivity, WP

Publication Details

  • Pages:

    45

  • Volume:

    ---

  • DOI:

    ---

  • Issue:

    ---

  • Series:

    Working Paper No. 2018/159

  • Stock No:

    WPIEA2018159

  • ISBN:

    9781484363973

  • ISSN:

    1018-5941

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