Africa's mobile phone revolution (technology access (Mobile phones…
Africa's mobile phone revolution
SSA is a black hole of information capital (castells)
Lack of technology access
exponential growth - 66% growth rate, - cca. 700m N.B. differences between penetration and diffusion rates.
used to maintain social relationships.
SIM renting. M-Pesa. Dual SIM card phones
use to buy goat meat in Kenya (Manson, 2014)
check prayer times (FT, 2014)
reduces or reinforces inequalities? removes or reinforces borders?
revenues taken by governments (Economist, 2016)
The Mobile Phone Revolution in Africa: rhetoric or reality? Etzo and Collender
Mobile telephony is both reducing and reinforcing inequalities
linked to $ growth.
countries with <10% pentration rates have 0.59% higher GDP
1) incremmental (immediacy) 2) transformational (dynamism e.g. MPesa & mPedigree) and 3) production related benefits
low literacy levels
govt. restrictions and lack of investment
How has mobile phone penetration stimulated financial development in Africa? :
mobile saving (& partial saving)
internet banking terminal
role of the informal sector
established a correlation between mobile phone penetration and financial intermediary African development.
Mobile Telephony in Tanzania: Molony
limitations of mobile telephony in Tanzania's Kariakoo - Dar Es Salaam, agricultural market
structure of trade: potato & tomato farmers. Intermediary traders & wholesale traders. - Agriculture is most widespread $ activity & the role of perishable foodstuffs is pivotal.
Still difficult in rural areas.
cannot be the sole means of communication (doesn't reduce the poorest, small-scale farmers reliance on credit).
face-to-face trading: 1) initial meeting, 2) discuss continuing relationships 3) strengthening relationship & financial assistance.
weakens farmers' ties with trad. forms of credit (middlemen)
Kamwene's personal relationships.
Easier to do business (improved communications).
improves both conditions for supply and demand.
increases mobility: reduces travel-related risks & costs
allows long-distance travel (Jensen).
Improve the exchange of supply and demand info. between farmer & wholesale market.
BUT industry is still heavily reliant on face-to-face meetings and relationships.
reduces risks of being cheated by middle-men BUT weakens credit relationships.
Kranzberg Law: technology is not good or bad but neutral
thick v thin integration
local v global scales
knowledge clusters and local innovation systems
Kenya's Silicon Savannah (FT, 2014)
Mobile Phone and Economic Development in Africa. : Aker.
mobile phone technology cannot produce the "silver bullet" for African development.
intra-Africa digital divide.
contentious figures: 1) diffusion v penetration rates. 2) individual v firm adoption rates. 3) rich v poor. 4) young v old. 5) male v female.
figures can be a result of reverse causality.
possibility for development not properly assessed
lack of empirical macro-economic evidence.
improve access to information
improve firms' efficiency
creates new jobs (through increased demand)
facilitates communication (and mitigates risks)
Aker (2010) reduced dispersion of grain dispersion by 10%.
Aker (2008) associated w/ increased trader & consumer welfare.
Autor (2001) reducing search costs in labour markets reduces unemployment.
improves intra-firm co-ordination.
generates +tional employment (in formal & informal sector)
encourages good governance: 1) parallel vote tabulation (Kenya) and ushahidi (crowdsourcing)
it requires complimentartity between mobile phone technology and other forms of capital (power, roads and water).