Investigating Electricity Access Effect on Happiness: Empirical Evidence from African Great Lakes Countries

Abstract

This study examines the relationship between electricity access and happiness in African Great Lakes Countries (GLCs using panel data from 2012 to 2021. Employing the Cantril ladder score as a measure of subjective well-being, the analysis investigates how electrification influences happiness, with a focus on rural-urban disparities. The baseline estimates, derived using Driscoll & Kraay standard errors, reveal a statistically significant and positive relationship between electricity access and happiness, particularly in rural areas, where the effect is substantially larger than in urban settings. To address endogeneity concerns, the study further employs an Instrumental Variable Two-Stage Least Squares (IV-2SLS) approach, which corroborates and amplifies these findings, underscoring the causal impact of electrification on well-being. Control variables, including education, financial development, health, and industrialization, consistently exhibit theoretically aligned and statistically significant effects, reinforcing the robustness of the model. The results highlight the transformative potential of electrification in enhancing happiness, suggesting that policies targeting underserved regions could yield disproportionate well-being gains. This study provides region-specific insights often obscured in global analyses, thereby contributing to the broader discourse on energy access and development.