IMPACT OF RURAL ELECTRIFICATION ON HOUSEHOLD’S WELFARE; IN CASE OF GURAGE ZONE, SNNPRS

Abstract

The main goal of this study was to impact of rural electrification on household’s welfare; in case of Gurage zone, SNNPRS. Towards this end, a multi stage sampling technique was used to collect data from a total of 228 randomly selected sample households, of which 125 households were electrified and 103 households were non-electrified. This study used both primary and secondary data collected through interview schedule and review of various documents respectively. Descriptive statistics as well as econometrics methods of data analysis was employed. The result from the binary logit model indicated that education level, community access to good road, connection with national line, income of the households were found to be positively and significantly determining grid household’s electrification. Moreover, the propensity score matching model, based on the radius caliper (0.1) matching technique was used to analyze the impact of rural electrification on household’s consumption expenditure and income. Accordingly, the average treatment effect on treated (ATT) estimation result revealed that rural electrification had significantly increased the per capita food consumption expenditure, per capita total expenditure and total annual income of the households. Thus, constructing rural roads, expansion of the capacity of the electric power and tackling electric power outage ad facilitate either formal or informal education access there by to electrify rural farm households were recommended to the government bodies to sustain the significant outcome of rural electrification.