ABSTRACT
Existing studies indicate that access to electricity is associated with gainful economic benefits. The main goal of the study was to examine the effect of electricity consumption on industrial output while holding other factors constant using data sets from the Uganda Investment Authority, Uganda Bureau of Statistics, Electricity Regulatory Authority, and World Bank enterprise report on workers’ education, labour employed, and electricity consumed by the industries (agro based). Using the vector error correction model, results of the study indicated that that education, electricity consumption, and labour have a long-term causality on industrial output. Based on the research questions, the effect of electricity consumption on industrial output, the effect of educated workers on industrial output, and the labour employed influence industrial output. Furthermore, we find evidence that workers’ education and the labour employed differentials correspond directly with industrial output differentials. Regulators must make efforts to increase an affordable and reliable supply of industrial electricity as a facilitating condition through subsidised electricity tariffs. Moreover, results suggest that industrial-led electricity consumption policies that can enhance industrial growth should be implemented. Likewise, the results also suggest efforts to encourage agro-based industries to employ more well-educated workers to increase the industrial output.
