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<p>This study examines the effect of energy poverty on economic complexity using an unbalanced panel of 116 countries over the period 1996–2019. Beyond estimating the direct effects, the analysis explores the mechanisms through which energy poverty shapes structural economic transformation. To address potential endogeneity and ensure robustness, instrumental variable two-stage least squares (IV-2SLS) and system generalized method of moments (GMM) estimators are employed. The results indicate a significant and positive impact of energy poverty reduction on economic complexity. These findings remain consistent across alternative specifications, robustness checks, and subsample analyses. Mechanism analysis further reveals that improvements in human capital and income levels constitute the primary channels of transmission. The evidence highlights energy access as a critical determinant of economic sophistication, underscoring the need for targeted energy policies to foster inclusive growth and structural transformation.</p>

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Energy poverty and economic complexity: effect and transmission channels

  • 期刊论文

  • 发表日期：

    2025年10月14日

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  • Hemachandra Padhan,
  • Sosson Tadadjeu,
  • Henri Njangang,
  • Brice Kamguia

摘要

This study examines the effect of energy poverty on economic complexity using an unbalanced panel of 116 countries over the period 1996–2019. Beyond estimating the direct effects, the analysis explores the mechanisms through which energy poverty shapes structural economic transformation. To address potential endogeneity and ensure robustness, instrumental variable two-stage least squares (IV-2SLS) and system generalized method of moments (GMM) estimators are employed. The results indicate a significant and positive impact of energy poverty reduction on economic complexity. These findings remain consistent across alternative specifications, robustness checks, and subsample analyses. Mechanism analysis further reveals that improvements in human capital and income levels constitute the primary channels of transmission. The evidence highlights energy access as a critical determinant of economic sophistication, underscoring the need for targeted energy policies to foster inclusive growth and structural transformation.