Electricity access and poverty reduction dynamics in Botswana: an ARDL approach

Abstract

Purpose: In this study, the impact of access to electricity on poverty reduction is examined using annual data from 1990 to 2021 for Botswana. The study was motivated by the need to establish if access to electricity could be a panacea on poverty reduction in Botswana. Given that the United National Sustainable Development Goal deadline is fast approaching, and Botswana being one of the signatories, is expected to end poverty in all its forms – Goal 1. Establishing the role that electrification plays in poverty alleviation helps in refocusing Botswana’s poverty alleviation strategies on factors that have high impact on poverty. The main objective of this study, therefore, is to investigate the relationship between poverty alleviation and access to electricity in Botswana. Approach: The study uses the autoregressive distributed lag (ARDL) approach to investigate the nature of the relations. Two poverty proxies were used in this study namely, household consumption expenditure and life expectancy. Findings: The study found access to electricity to reduce poverty in the long run and in the short run, regardless of the poverty measure used. Thus, access to electricity plays an important role in poverty alleviation and Botswana is recommended to continue with the rural and urban electrification initiatives. Originality: The study explores the impact of access to electricity on poverty reduction in Botswana, a departure from current studies that examined the same relationship using energy consumption in general. This is on the back of increasing dependence of economic activities on electricity as a major source of energy.