Assessing the role of globalization for universal electricity access

Abstract

Using the electricity access rate to measure progress towards the Sustainable Development Goal target for universal access to electricity by 2030, about 580 Millions African people lack electricity access. However, globalization offers technological innovation, financial resources and international cooperation opportunities to achieve universal electricity access. This paper investigates whether increasing globalization levels can help achieve the goal of expanding access to electricity services in Africa. The analysis is based on panel data of 36 African countries over the 2000–2017 period and system GMM for empirical estimations. Our findings indicate that economic, social, and political globalization matters for increasing access to electricity. We also find that economic globalization reduces disparities in access to electricity. Further decomposing of economic globalization indicates that financial globalization, FDI and trade openness increase access to electricity. Furthermore, while financial globalization and FDI widen disparities in access to electricity, trade openness negatively affects disparities. The results also indicate that economic growth is one of the important channels through which globalization enhances electricity access. Finally, we carry out sub-regional analyses and find that these patterns are robust across Sub-Saharan African countries.