Session 1: Energy
Mr. Pratyaya Amrit, Secretary of the Bihar Department of Energy opened the first session of the Bihar Growth Conference introducing Nicholas Ryan (Harvard University) and his presentation “Lighting up Bihar”. Behind this IGC funded project there is the idea that most of the pillars of economic growth (e.g. health, education, productivity increases) require or strongly benefit from access to electricity. Bihar’s per capita electricity consumption hovers at around 15% of the national average, equivalent to 1% of the same figure for the US, suggesting the need for a large investment in power supply expansion. To tackle this issue, the research team and the Bihar Department of Energy designed an incentive scheme that connects power supply (in terms of hours per day) to local payment rates. In doing so, this intervention managed to double the payment rate in the treatment locations by allocating more power where payment rates are higher, but also by encouraging consumers to pay. Scaling up this program will generate higher revenues per unit of electricity provided and, in turn, encourage improved service quality, increase power supply and boost Bihar’s economic and social development.
David Szakonyi (Columbia University) spoke next, sharing updates and preliminary finding from his latest project: “The benefits of solar technology adoption for street vendors in Bihar”. Employing around 10 million people across India, this sector of the economy represents a sizeable share of the informal economy and provides livelihood for a large number of urban poor. In order to boost the economic activity of these microenterprises, the team led by David Szakonyi partnered with two local institutions to ease what 80% of Bihar street vendors identified as a top priority: access to electricity. By randomly allocating solar charged lamps for a subsidised rental fee, this constraint is being eased while allowing for a number of interesting research questions to be answered. For example, the experimental design of this intervention will result in a detailed evaluation of the program’s impact not only on basic economic measures of business activity, but also on investment, hours worked and type of customers reached. For example, better lighting might lead to longer working hours in the night and safer marketplaces, allowing vendors to attract workers at the end of the day and a higher proportion of women. Moreover, this experiment will shed more light on the dynamics of technology adoption, which is crucial to the productivity increase of these micro-businesses and to the life of urban poor.
By Andrea Smurra, Country Economist, IGC Myanmar