Beschreibung:
Despite wide attention on energy poverty (EP) and its effect on household well-being recently, no study has examined the relationship between EP and households’ consumption or savings. To fill this literature gap, we examine the effect of households' Multidimensional Energy Poverty (MDEP) on their consumption and savings using the Household Risk and Vulnerability Survey (HRVS), 2016 – 18, a three-year panel data from Nepal. We employ a pooled OLS, a dynamic panel fixed effect model, a panel instrumental variable model, and Lewbel's (2012) 2SLS method in this study. We find EP significantly reduces households' consumption and savings by a more significant amount. We further find that EP’s detrimental impact on consumption or savings is statistically alike in magnitude across the gender of the household head. Finally, we show that increased reliability of electricity supply improves household consumption and savings. Therefore, providing an uninterrupted electricity supply is important for enhancing households’ well-being in developing countries. Overall, our study informs the significance of alleviating EP in improving household welfare. This study is policy-relevant to understanding the current situation of EP in Nepal and its consequences. This idea can also be expanded to investigate similar issues in other developing countries