We examine the growth of mobile phone technology over the past decade and consider its potential impacts upon quality of life in low-income countries, with a particular focus on sub-Saharan Africa. We first provide an overview of the patterns and determinants of mobile phone coverage in sub-Saharan Africa before describing the characteristics of primary and secondary mobile phone adopters on the continent. We then discuss the channels through which mobile phone technology can impact development outcomes, both as a positive externality of the communication sector and as part of mobile phone-based development projects, and analyze existing evidence. While current research suggests that mobile phone coverage and adoption have had positive impacts on agricultural and labor market efficiency and welfare in certain countries, empirical evidence is still somewhat limited. In addition, mobile phone technology cannot serve as the "silver bullet" for development in sub-Saharan Africa. Careful impact evaluations of mobile phone development projects are required to better understand their impacts upon economic and social outcomes, and mobile phone technology must work in partnership with other public good provision and investment.

Access to and use of mobile telephony in sub-Saharan Africa has increased dramatically over the past decade. Mobile telephony has brought new possibilities to the continent. Across urban-rural and rich-poor divides, mobile phones connect individuals to individuals, information, markets, and services. These effects can be particularly dramatic in rural Africa, where in many places mobile phones have represented the first modern telecommunications infrastructure of any kind. Mobile phones have greatly reduced communication costs, thereby allowing individuals and firms to send and to obtain information quickly and cheaply on a variety of economic, social, and political topics. An emerging body of research shows that the reduction in communication costs associated with mobile phones has tangible economic benefits, improving agricultural and labor market efficiency and producer and consumer welfare in specific circumstances and countries. This paper first examines the evolution of mobile phone coverage and adoption in sub-Saharan Africa over the past decade. We then explore the main channels through which mobile phones can effect economic outcomes and appraise current evidence of its potential to improve economic development. We conclude with directions for future research and outline the necessary conditions for mobile phones to promote broader economic development in Africa.

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. ABSTRACT M-Pesa is a mobile phone based money transfer system in Kenya which grew at a blistering pace following its inception in 2007. We examine how M-Pesa is used as well as its economic impacts. Analyzing data from two waves of individual data on financial access in Kenya, we find that increased use of M-Pesa lowers the propensity of people to use informal savings mechanisms such as ROSCAS, but raises the probability of their being banked. Using aggregate data, we calculate the velocity of M-Pesa at between 11.0 and 14.6 person-to-person transfers per month. In addition, we find that M-Pesa causes decreases in the prices of competing money transfer services such as Western Union. While we find little evidence that people use their M-Pesa accounts as a place to store wealth, our results suggest that M-Pesa improves individual outcomes by promoting banking and increasing transfers. Terms of use: Documents in

ub-Saharan Africa has some of the lowest levels of infrastructure investment ub-Saharan Africa has some of the lowest levels of infrastructure investment in the world. Merely 29 percent of roads are paved, barely a quarter of the in the world. Merely 29 percent of roads are paved, barely a quarter of the population has access to electricity, and there are fewer than three landlines population has access to electricity, and there are fewer than three landlines available per 100 people (ITU, 2009; World Bank, 2009a). Yet access to and use of available per 100 people (ITU, 2009; World Bank, 2009a). Yet access to and use of mobile telephony in sub-Saharan Africa has increased dramatically over the past mobile telephony in sub-Saharan Africa has increased dramatically over the past decade. There are ten times as many mobile phones as landlines in sub-Saharan decade. There are ten times as many mobile phones as landlines in sub-Saharan Africa (ITU, 2009), and 60 percent of the population has mobile phone coverage. Africa (ITU, 2009), and 60 percent of the population has mobile phone coverage. Mobile phone subscriptions increased by 49 percent annually between 2002 and Mobile phone subscriptions increased by 49 percent annually between 2002 and 2007, as compared with 17 percent per year in Europe (ITU, 2008). 2007, as compared with 17 percent per year in Europe (ITU, 2008). Mobile telephony has brought new possibilities to the continent. Across urban-Mobile telephony has brought new possibilities to the continent. Across urbanrural and rich-poor divides, mobile phones connect individuals to individuals, rural and rich-poor divides, mobile phones connect individuals to individuals, information, markets, and services. In Mali, residents of Timbuktu can call rela-information, markets, and services. In Mali, residents of Timbuktu can call relatives living in the capital city of Bamako-or relatives in France. In Ghana, farmers tives living in the capital city of Bamako-or relatives in France. In Ghana, farmers in Tamale are able to send a text message to learn corn and tomato prices in Accra, in Tamale are able to send a text message to learn corn and tomato prices in Accra, over 400 kilometers away. In Niger, day laborers are able to call acquaintances over 400 kilometers away. In Niger, day laborers are able to call acquaintances in Benin to fi nd out about job opportunities without making the US$40 trip. In in Benin to fi nd out about job opportunities without making the US$40 trip. In Malawi, those affected by HIV and AIDS can receive text messages daily, reminding Malawi, those affected by HIV and AIDS can receive text messages daily, reminding them to take their medicines on schedule. Citizens in countries as diverse as Kenya, them to take their medicines on schedule. Citizens in countries as diverse as Kenya, Nigeria, and Mozambique are able to report violent confrontations via text message Nigeria, and Mozambique are able to report violent confrontations via text message to a centralized server that is viewable, in r...

We examine the impact of the Kenyan Free Primary Education program on student participation, sorting, and achievement on the primary school exit examination. Exploiting variation in pre-program dropout rates between districts, we find that the program increased the number of students who completed primary school, spurred private school entry, and increased access for students from disadvantaged backgrounds. We argue that the program was welfare enhancing as it promoted educational access without substantially reducing the test scores of students who would have been in school in the absence of the program. (JEL H52, I21, I28, O15)