Electricity Consumption and Economic Growth in Southern African Development Community Region

Abstract

This study empirically analyzed the effects of access to electricity by distinct population segments on economic growth in the Southern African Development Community using longitudinal data for a panel of 12 countries during the sample period 2010-2020. The methodological approach used followed applied the Breusch-Pagan Lagrangian multiplier test and Hausman test procedures. Based on the fixed effects model estimates, empirical results show that increases in percentages of rural and urban populations with access to electricity distinctly had statistically significant and positive effects on economic growth; with rural population access to electricity having had a more noticeable significant positive effect on economic growth than the rural population in the region. The estimated R-squared shows that approximately 8.0 percent total variation in economic growth was explained by the shares of the total population, rural population, and urban population. The F-statistic (= 6.48; p < 0.05) reveals significance of the model; while the interclass correlation value shows that approximately 80.1 percent of the variance was due to differences across panels.

Keywords: electricity, access, population, urban, rural, economic growth

DOI: 10.7176/JESD/13-24-02

Publication date: December 31^st 2022