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Achieving universal access to electricity is one of the most important energy policy goals set by governments in the developing world. The recent empirical literature, however, paints a mixed picture about the economic viability of rural electrification. Although many studies find substantial socioeconomic benefits from rural electrification, others propose that these benefits are overstated. This paper examines the hypothesis that the magnitude and the nature of benefits associated with electrification are highly context dependent. Using a panel data of 7,018 rural households in Bangladesh for 2005 and 2010, the paper explores two underlying determinants of the heterogeneity: the quality of electricity supply and the number of years of being connected to the grid. The analysis uses an instrumental variable and propensity-score-weighed fixed-effects model to address potential endogeneity of electricity adoption. The analysis finds that power outages have a negative impact on almost all development outcomes considered, while some benefits of electrification accrue only over the long run. The overall gain from expanding access to and improving reliability of electricity supply in Bangladesh is estimated to be US$2.3 billion a year.

Education is an important form of human capital that improves productivity, health and nutrition of the people of a country and slows down its population growth. In Bangladesh - where literacy rate is only 35 per cent and average population growth is 2.3 per cent - the need to promote investment, according to the author, can hardly be overemphasized. Based on household- and school level survey of rural Bangladesh, only 64 per cent of the boys and 58 per cent of the girls aged 5-20 attend schools. Only 9 per cent of the boys and 5 per cent of the girls complete secondary education. The authors identify the key issues involved in such poor performance. (DÜI-Sen)

Household air pollution is the second leading cause of disease in Madagascar, where more than 99% of households rely on solid biomass for cooking. This article presents findings and conclusions from an initiative to monitor household air pollution in rural Madagascar. The average concentrations of fine particulate matter and carbon monoxide in kitchens significantly exceeded World Health Organization guidelines for indoor exposure. A fixed-effect panel regression analysis was conducted to investigate the effects of fuel (charcoal, wood, and ethanol), stove (traditional, improved charcoal and wood, and ethanol), kitchen size, ventilation, building materials, and ambient environment. Ethanol is significantly cleaner than biomass fuels, and a larger kitchen significantly improves the quality of household air. Although improved wood stoves with a chimney were effective in reducing concentrations of carbon monoxide in the kitchen, improved charcoal stoves were found to have no significant impact on air quality compared with traditional charcoal stoves. The findings reinforce the need for initiatives that foster fuel switching and improved ventilation as critical first steps to fight unhealthy household air pollution in developing countries.

Preface -- About the authors -- Abbreviations -- Introduction -- Rural nonfarm growth and poverty reduction -- Institutional growth and MFI performance -- Dynamics of microfinance benefits -- Are borrowers overindebted? -- Role of microfinance in poverty transition -- Diversification of income and employment : how does microfinance affect agriculture? -- Distributional impacts -- Effects of noncredit participation -- Does microfinance pay off? -- Beyond ending poverty -- Appendix A: Data description -- Appendix B: Alternative models to estimate the impact of microfinance

Public programs are designed to reach certain goals and beneficiaries. Methods to understand whether such programs actually work, as well as the level and nature of impacts on intended beneficiaries, are main themes of this book. Has the Grameen Bank, for example, succeeded in lowering consumption poverty among the rural poor in Bangladesh? Can conditional cash transfer programs in Mexico and Latin America improve health and schooling outcomes for poor women and children? Does a new road actually raise welfare in a remote area in Tanzania, or is it a "highway to nowhere?" This book r