Electricity Shortage and Productivity: Why Do Some Firms Thrive in a Poor Business Environment while others are Unable?
| dc.contributor.author | Seukou, Yvette Djoha | |
| dc.contributor.author | Nourou, Mohammadou | |
| dc.contributor.author | Fokou, Carrel | |
| dc.date.accessioned | 2025-05-06T08:30:00Z | |
| dc.date.available | 2025-05-06T08:30:00Z | |
| dc.date.issued | 2025 | |
| dc.description.abstract | Although the relationship between unreliable electric power costs and firm productivity has received considerable attention from researchers, few studies have asked why some firms succeed in an unreliable electric power environment while others are unable to. To achieve the study's purpose, the paper compares the World Bank Enterprise survey’s unbalanced panel data over two periods: 2006-2014 and 2008-2023. Additionally, it uses the "k-means clustering" algorithm to rank clusters of sub-Saharan African firms that share similar electricity shortages experience, adaptation strategies and productivity profiles. The multinomial probit model is used to determine the success factors of firms operating in an unfavorable environment, at firm and industry level over time. We find that there are three categories of firms operating under the constraints of power shortages: “heavily impacted firms”, partially impacted firms”, and “resilient firms”. Strong institutions reduce the probability of belonging to the group of firms that are “heavily impacted” by electricity shortages. In contrast, the probability of belonging to the “resilient” group of firms increases with gross domestic product. When we look at the influence of entrepreneurs' perception of certain obstacles in the business environment (electricity shortage and the informal sector) on cluster membership, we find that, for both grouped and period data, the perception of electricity shortage and the informal sector as a major obstacle in the business environment also explain cluster membership. | |
| dc.identifier.uri | https://publication.aercafricalibrary.org/handle/123456789/3990 | |
| dc.language.iso | en_US | |
| dc.publisher | AERC | |
| dc.relation.ispartofseries | AERC Working Paper 011-2025 | |
| dc.title | Electricity Shortage and Productivity: Why Do Some Firms Thrive in a Poor Business Environment while others are Unable? | |
| dc.type | Working Paper |