Job Market Paper

Credit and attention in the adoption of profitable energy efficient technologies in Kenya (with J.T. Dean. Available here.)
What roles do credit constraints and inattention play in the under-adoption of high-return technologies? We study this question in the case of energy efficient cookstoves in Nairobi. Using a randomized field experiment with 1,000 households, we estimate a 300% average annual rate of return to investing in this technology, or $120 per year in fuel savings - around one month of income. Despite this, adoption rates are low: eliciting preferences using an incentive-compatible Becker-DeGroot-Marschak mechanism, we find that average willingness-to-pay (WTP) is only $12. To investigate what drives this puzzling pattern, we cross-randomize access to credit with two interventions designed to increase attention to the costs and benefits of adoption. Our first main finding is that credit doubles WTP and closes the energy efficiency gap over the period of the loan. Second, credit works in part through psychological mechanisms: around one-third of the total impact of credit is caused by inattention to loan payments. We find no evidence of inattention to energy savings. These findings have implications for second-best regulation of pollution externalities using subsidies versus taxes. In low-income contexts, where credit constraints are common, Pigovian taxation alone may not be the optimal policy. Private benefits and avoided environmental damages generate average welfare gains of $600 for each stove adopted and used for two years. A subsidy would have a marginal value of public funds of $19 per $1 spent. 

          Coverage:
​          [World Bank Development Impact Blog] [US Association for Energy Economics Best Student Paper] [Energy Institute at Haas Blog] 
​          Cited as evidence for ID Insight's Giving Green Recommendation for Jikokoa stoves.

Publications

Electric heating and the effects of temperature on household electricity consumption in South Africa (Available here) The Energy Journal. 2020. Forthcoming.
How does temperature affect household energy demand in low-income countries? I use 132,375,282 hourly electricity consumption observations from 5,975 households in South Africa to estimate the causal effects of short-term temperature changes on household electricity consumption. The estimates flexibly identify a constant log-linear temperature response - for every 1°C increase in temperature, electricity consumption decreases by 4.1% among temperatures below the heating threshold but increases by 8.1% among temperatures above the cooling threshold. This relationship is driven more strongly by seasonal than hourly temperature changes. Holding all else constant, a 3.25°C increase in temperatures would reduce electricity consumption by 1,093.4 kWh (6.2%) per year per household. Widespread use of electric heating due to limited residential gas heating infrastructure likely drives this. These results point to important regional heterogeneity in how temperature increases may affect household energy demand in the coming decades.

​Hardware, apps, and surveys at scale: Insights from measuring grid reliability in Accra, Ghana  (Available here) ​N. Klugman, J. Adkins, S. Berkouwer, K. Abrokwah, I. Bobashev, P. Pannuto, M. Podolsky, A. Suseno, R. Thatte, C. Wolfram, J. Taneja, and P. Dutta). ​July 2019. The second annual ACM SIGCAS Conference on Computing and Sustainable Societies (COMPASS '19).
The vision of sensor systems that collect critical and previously ungathered information about the world is often only realized when sensors, students, and subjects move outside the academic laboratory. However, deployments at even the smallest scales introduce complexities and risks that can be difficult for a research team to anticipate. Over the past year, our interdisciplinary team of engineers and economists has been designing, deploying, and operating a large sensor network in Accra, Ghana that measures power outages and quality at households and firms. This network consists of 457 custom sensors, over 3,000 mobile app instances, thousands of participant surveys, and custom user incentive and deployment management systems. In part, this deployment supports an evaluation of the impacts of investments in the grid on reliability and the subsequent effects of improvements in reliability on socioeconomic well-being. We report our experiences as we move from performing small pilot deployments to our current scale, attempting to identify the pain points at each stage of the deployment. Finally, we extract high-level observations and lessons learned from our deployment activities, which we wish we had originally known when forecasting budgets, human resources, and project timelines. These insights will be critical as we look toward scaling our deployment to the entire city of Accra and beyond, and we hope that they will encourage and support other researchers looking to measure highly granular information about our world’s critical systems.

Research in Progress

The political economy and governance of rural electrification (with Eric Hsu, Edward Miguel, and Catherine Wolfram).
Governments in low-income countries frequently outsource public good provision to the private sector, but the political economy and governance issues in this sphere remain poorly understood. We study outsourced public good provision by a low-capacity state in the context of Kenya's national Last Mile Connectivity Project, which aims to provide universal household electricity access by 2020 using World Bank and African Development Bank funding. We focus on three factors in particular as potential drivers of construction quality: donor conditionality, political incentives, and independent monitoring in a repeated-game setting. We collect temporally and spatially rich administrative planning data on the construction process across thousands of projects, and complement this with novel field engineering assessments and household surveys in 380 sites to study the channels affecting leakage and technical construction. Collection of administrative data is complete and analysis is ongoing. Collection of electricity infrastructure construction quality measurements and household survey data is ongoing and has been completed across more than 100 sites. (This study is registered in the AEA RCT Registry, ID 2389) ​​

          Coverage: [DFID Economic Development and Institutions Video] [PBS NewsHour]

The economics of long-term grid reliability (with Catherine Wolfram and Steve Puller)
In urban areas of Ghana, a primary barrier to economic growth is the reliability of the grid. Since 2012, persistent power failures have given rise to the term 'Dumsor,' meaning 'lights off-on' in the Akan language. According to a 2013 World Bank report, 61% of firms see electricity reliability as a major constraint, with firms reporting an average of over 700 hours of outages annually, compared to 1.5 hours for firms in the U.S. We first study quasi-randomly assigned infrastructure upgrades to estimate the cost of marginal improvements in reliability. We then exploit spatial network discontinuities in power quality across Accra to understand the socio-economic impacts of long-term reliability improvements. We collect temporally and spatially high-resolution reliability data using the GridWatch technology, and combine these with administrative infrastructure network data and 5,000 on-the-ground firm and household surveys to accurately estimate these outcomes.

          Coverage: ​[Energy Institute at Haas Blog]

Political incentives and public goods provision in Kenya: Evidence from the electrification of rural community facilities (with Kenneth Lee and Michael Walker)
We study how political incentives affect the allocation of government funds to community facilities in rural Kenya. The government officials that are responsible for allocating resources across public facilities often face personal political incentives such as election pressures, causing realized allocations to differ from what would have been optimal to achieve poverty reduction. In rural Kenya, where some counties have an average per capita GDP of only $282, the proper funding and functioning of public facilities such as schools, health centers, and central markets are crucial for achieving poverty alleviation. Members of parliament may overweight allocation of funds towards areas where they are politically either particularly weak (for example to win votes in an upcoming election) or strong (for example to reward constituents that voted for them in a recent election), rather than allocate funding for public facilities where it is needed most. We study the electrification of 3,202 public facilities, including markets, schools, health centers, and water points, by the Rural Electrification Authority in 162 nationally representative constituencies in Kenya, between 2008-2013 to answer this question.