Tracking Economic Fluctuations in Bangladesh with Electricity Consumption

This paper investigates whether electricity consumption is a useful indicator for trackingeconomic fluctuations in Bangladesh. It presents monthly data on national electricity consumption since 1993 anddaily consumption data since February 2010 for the country’s eight divisions. National electricity...

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Bibliographic Details
Published inIDEAS Working Paper Series from RePEc
Main Authors Arshad, Selvia, Beyer, Robert Carl Michael
Format Paper
LanguageEnglish
Published St. Louis Federal Reserve Bank of St. Louis 01.01.2022
Subjects
Coronaviruses
COVID-19
Bangladesh
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Summary:This paper investigates whether electricity consumption is a useful indicator for trackingeconomic fluctuations in Bangladesh. It presents monthly data on national electricity consumption since 1993 anddaily consumption data since February 2010 for the country’s eight divisions. National electricity consumption isstrongly correlated with other high-frequency indicators of economic activity, and it has declined during naturaldisasters and the COVID-19 lockdowns. The paper estimates an electricity consumption model that explains over 90 percentof the variation in daily consumption based on the trend, seasonality, within-week variation, holidays, Ramadan, andtemperature. Deviations from the model prediction can act as in indicator of economic fluctuations. For example, duringthe first COVID-19 lockdown in April 2020, electricity consumption in Dhaka fell over 40 percent compared withnormal and remained below the normal level until early 2021. The later lockdowns, in contrast, had only small additionalimpacts, in line with less stringent containment measures and more effective adaptation.