African Learning Design | 28 April 2006
Bayesian Hierarchical Model for Evaluating Cost-Effectiveness of Power-Distribution Equipment in Senegal
M, a, m, a, d, o, u, D, i, a, l, l, o, ,, I, b, r, a, h, i, m, a, S, a, r, r, ,, M, a, r, i, a, m, a, N, d, i, a, y, e
Abstract
The provision of reliable power distribution equipment in Senegal is crucial for economic development but often expensive. Current cost-effectiveness evaluations lack a rigorous statistical framework. A Bayesian hierarchical model was constructed to account for variability across regions. The model incorporates uncertainty through robust standard errors and confidence intervals. The analysis revealed significant disparities in cost-effectiveness among different power-distribution equipment models, particularly in rural areas where the cost per unit of electricity produced varied by up to 30%. This study provides a novel method for evaluating regional variations in cost-effectiveness that can guide policy decisions in Senegal's power sector. Policy makers should consider regional-specific models when determining investment priorities in power distribution equipment. The maintenance outcome was modelled as $Y<em>{it}=\beta</em>0+\beta<em>1X</em>{it}+u<em>i+\varepsilon</em>{it}$, with robustness checked using heteroskedasticity-consistent errors.