and low institutional stability (including corruption) increasing investment risks. While each of these barriers can contribute to the low diffusion rate of mini-grids in LDCs, the innovation system literature stresses the role of the interaction of such barriers and of systemic bottlenecks or system failures.
In this paper we therefore apply the framework of Technological Innovation System (TIS) and its functional approach.
It has proven to deliver valuable insights into the development and diffusion of specific technologies as well the
(sometimes systemic) bottlenecks hampering their innovation and diffusion, both being helpful for deriving policy recommendations. Though the framework is universally applicable , it “has had a limited practical application in the global south so far Hence, by applying the TIS framework in an LDC context, we do not only aim to generate practical insights on how to foster the diffusion of rural mini-grids, but also to further develop the theoretical
TIS literature. Our paper's geographic scope is the Lao People's Democratic Republic (Lao PDR, or Laos). It is characterized by the aforementioned LDC-typical innovation-hampering circumstances, as these numbers illustrate: The average literacy is 76% (men) and 53% (woman). In rural areas 32% of the men and 53% of the women never attended school (Peters, 1995). Laos ranks 147 out of 162 countries in the Ar Co technological
capabilities ranking ; 131 of 160 in the 2014 World Bank Logistics Performance Index measuring transport infrastructure quality ; 160 of 174 in Transparency International's 2012 Corruption
Perceptions Index; and 163 out of 185 in the World Bank's, 2013 Ease of Doing Business Report's ranking . Additionally, Laos is characterized by a high ethnical and cultural
diversity