The Economic and Environmental Effects of Infrastructure Improvements: Evidence from Pakistan’s Electricity Sector
Fiscal challenges pervade the electricity sector in many developing countries. Low bill payment and high theft mean utility customers have little incentive to conserve. It also means electricity distribution companies have less to invest in infrastructure maintenance, modernization, and technical upgrades. The resulting low quality electricity services can impair economic benefits from connections to the electrical grid.
Using differences in intervention timing across space, we study the impacts of an infrastructural intervention that made illegal electricity connections physically more difficult in Karachi, Pakistan.