Choice Experiment Study on the Wilingness to Pay to Improve Electricity Services

Sabah Abdullah, Petr Mariel

Research output: Working paper

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Abstract

Modern forms of energy are an important vehicle towards poverty alleviation in rural areas of developing countries. Most developing countries’ households heavily rely on wood fuel which impact their health and social–economic status. To ease such a dependency, other modern forms of energy, namely electricity, need to be provided. However, the quality of the electricity service, namely reliability, is an important factor in reducing this dependency. This paper discusses a choice experiment valuation study conducted among electrified rural households located in Kisumu, Kenya, in which the willingness to pay (WTP) to avoid power outages or blackouts was estimated. A mixed logit estimation was applied to identify the various socio-economic and demographic characteristics which determine preferences to reduce power outages among a household’s users. In conclusion, several of the socio-economic and demographic characteristics outlined in this paper were identified and can assist service differentiation to accommodate the diverse households’ preferences towards the improvement of the electricity service.
Original languageEnglish
Place of PublicationBath, U. K.
PublisherDepartment of Economics, University of Bath
Publication statusPublished - 2009

Publication series

NameBath Economics Research Working Papers
No.15/09

Keywords

  • random parameter logit
  • willingness to pay
  • power outages
  • rural
  • developing country

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    Abdullah, S., & Mariel, P. (2009). Choice Experiment Study on the Wilingness to Pay to Improve Electricity Services. (Bath Economics Research Working Papers; No. 15/09). Department of Economics, University of Bath.