Divergence of electric power consumption: evidence from the SAPP

In: The journal of developing areas, Volume 44, Issue 1, p. 123-147

Abstract

With the relatively low per capita electric power consumption in Africa, several electric power pools have been emerging recently. The South African Power Pool (SAPP), the first of those power pools, started operating in 1995 under the aegis of the Southern African Development Community (SADC). This paper attempts to assess the convergence pattern of relative per capita electric power consumption within the SAPP over the period 1995-2005. A comparative study across regions is first conducted. Evidence in support of neoclassical convergence hypotheses such as the β -convergence and σ -convergence is obtained. Stochastic convergence is investigated by applying panel unit roots tests. In contrast, stochastic divergence of electric power consumption is found. Additionally, stochastic kernel analysis provides some evidence of club-formation.