11984-09_Annex2.qxd
3/4/10
12:51 PM
Page 127
Restoring Balance: Bangladesh’s Rural Energy Realities
127
Chapter 4 It is difficult to identify the causal effect of access to alternate energy sources on household income and consumption. Since energy demand and household consumption/income are jointly determined, it is difficult to correlate them without imposing certain restrictions on the demand function. The restriction applied here is that energy demand is influenced by energy prices, which can affect household income or consumption indirectly through demand. It is assumed that energy prices are determined by supply and demand, without individual households having any significant effect. Thus, a two-stage, least-squared instrument variable was used for this estimation (see Tables A2.2 and A2.3), where demand for energy sources was determined in the first phase.
Table A2.2. Effects of Energy Use on Household Outcomes by Use Type (N = 2,388)
Explanatory Variable Gender of household head (1 = male, 0 = female) Age of household head (years) Maximum education of adult males (years) Maximum education of adult females (years) Log of household landholding (decimal)1 Log of non-land household asset (Tk) Non-lighting energy use (kgoe/year) Lighting energy use (klmn–hr/year) If village has electricity Proportion irrigated area in village Whether village has any Paved road Primary school Health center Market Commercial bank NGO
Household per Capita Consumption (Tk/month) –0.0440
Household Income (Tk/month)1 Farm 0.598**
Non-farm –1.049**
Total 0.074
0.0003 0.0140**
–0.002 –0.023*
0.009** 0.120**
0.001 0.024**
0.0005
–0.022*
0.072**
0.021**
0.0450**
0.309**
0.0110**
0.162**
0.060**
0.049**
0.1270**
0.410**
0.025
0.208**
–0.010
0.387**
0.212**
–0.141 –0.153
0.903** –0.002
0.1360** –0.0130 0.0120
–0.160
0.0080 0.0290
0.005 0.158*
0.136 –0.047
–0.0060 –0.0120 –0.0890 –0.0780
–0.368** 0.079 0.095 –0.020
0.017 0.132 –0.506 0.235
0.066**
–0.058 0.021
0.070** 0.063* –0.063 –0.021 –0.158* 0.081 (continued )