A significant proportion of world’s population does not have access to grid-based electricity, and so relies on off-grid lighting solutions. Rechargeable bulb technology is becoming prominent as an alternative off-grid lighting model in developing countries. In this paper, we explore the consumer behaviour and the operational inefficiencies that result under this model. Specifically, we are interested in measuring the impact of inconvenience (of travel to recharge the bulb) which is a peculiar feature of this model, along with the impact of liquidity constraints on bulb usage. We analyse the efficacy of strategies that address these factors. We employ multiple methodologies: we first build a model of recharge decisions and theoretically explore its properties. To test (both ordinal and cardinal) predictions of this model, and to examine the performance of counterfactual strategies, we conduct field experiments in Rwanda in collaboration with a company that operates rechargeable bulbs business. Using our model as the data generating process, we then estimate its parameters by fitting it to the experimental data. Using the estimated model, we demonstrate that inconvenience-based strategies which are usually ignored by the firms and the policymakers tend to perform as well as, and sometimes better than price-based strategies in terms of improving the bulb usage. We also discuss the implications of our results for the off-grid firms and the policymakers and touch upon future work which involves studying impact of off-grid electricity on children education, gender equality issues and public health.
Bhavani Shanker Uppari is an assistant professor of Operations Management at Singapore Management University. Bhavani’s main research interests are in analysing the business models at the bottom of the pyramid. He is currently running randomised controlled trials to identify and test the scalable and sustainable business models to serve energy in villages in Rwanda. He is also interested in the field of behavioural operations management. His research in these domains won multiple awards, and is published in the Manufacturing & Service Operations Management (M&SOM) journal. Bhavani received the B.E. degree in Computer Science from Birla Institute of Technology and Science (BITS)-Pilani in India, and M.S. and Ph.D. degrees in Management from INSEAD.
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