The impact of electrification on labour market outcomes in Nigeria
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The impact of electrification on labour market outcomes in Nigeria Simone Tagliapietra1,2,3,4 · Giovanni Occhiali5 · Enrico Nano6 · Robert Kalcik7 Received: 21 October 2019 / Accepted: 22 June 2020 © Springer Nature Switzerland AG 2020
Abstract This article aims at providing a better understanding of the effect of electricity access onto labour market outcomes in Nigeria, a country which hosts the second largest population without access to electricity in the world after India, but which has received so far very little attention from the academic community. We assess, through a rigorous econometric analysis carried out employing probit, biprobit and propensity score matching, this impact on the proportion of employed working age components of a household. We consider both female and male employment as well as agricultural and non-agricultural employment separately, further disaggregating the effect between rural and urban households. Our results show that, once the possible endogeneity in the relationships under investigation is tackled, electricity access has indeed a relevant impact on particular labour market outcomes. Specifically, we show a consistent shift out of agricultural employment of around 7% and into nonagricultural employment of about 15%., with some evidence of a positive effect on overall labour participation. These findings show that the expansion of electricity access to households which are not yet connected to the grid could play a relevant role in both increasing labour market participation and in helping the transformation of the Nigerian economy away from agricultural activities. Keywords Nigeria · Energy access · Electrification · Labour market · Development
1 Introduction Electricity is a critical enabler. Access to electricity has underpinned the development and the growing prosperity of industrialised countries since the late nineteenth century: not only is electricity required by all industrial activities, it is also essential for the provision of clean water, sanitation and healthcare, as well as efficient lighting, heating, cooking, use of mechanical power, transport and telecommunication * Simone Tagliapietra [email protected] Extended author information available on the last page of the article
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Economia Politica
services (Rosenberg 1998; Elias and Victor 2005). However, 840 million people across the world continue to lack access to electricity. Sub-Saharan Africa remains the region with the largest access deficit: here, 573 million people—more than one in two—lack access to electricity (International Energy Agency et al. 2019). Access to affordable and reliable electricity is still one of the fundamental obstacles to reducing poverty, improving health, and promoting economic growth in many developing countries. Indeed, electricity has long been recognised as fundamental to development and poverty alleviation. As early as 1917, Lenin recognised this potential when describing communism as Soviet power summed-up with the electrification of
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