Mobile internet, skills and structural transformation in Rwanda

Abstract

This paper examines the relationship between mobile internet, employment and structural transformation in Rwanda. Thanks to its ability to enable access to a wide range of ICT technologies, internet coverage has the potential to affect the dynamics and the composition of employment significantly. To demonstrate this, we have combined GSMA network coverage maps with individual-level information from national population censuses and labour force surveys, creating a district-level dataset of Rwanda that covers the period 2002 to 2019. Our results show that an increase in mobile internet coverage affects the labour market in two ways. First, by increasing employment opportunities. Second, by contributing to changes in the composition of the labour market. Education, migration and shifts in demand are all instrumental in explaining our findings.

Mobile Internet and income improvement: Evidence from Viet Nam

“…The results in the Appendix also demonstrate the increasing effect sizes over time, which are all statistically significant with the exception of the one-year lead effect in the weighted model. This result indicates the potential long-term impacts of mobile technologies, aligning with evidence from Bahia et al (2020) and Caldarola et al (2022). The pre-trend assumption is also confirmed by the insignificant effects on the (placebo) lags before treatment.…”

“…Fourth, we use an event study approach, following Caldarola et al (2022). As Figure A9 in the Appendix shows, there are positive results of mobile internet coverage treatment 17 with similar effect sizes in the first year of adoption.…”

Mobile Internet Adoption and Inclusive Structural Change: Evidence from Nigerian Non-Farming Enterprises

“…Focusing on mobile internet (3G), Caldarola et al (2022) found a positive effect on aggregate employment across Rwandan districts. While both skilled and unskilled occupations grow, the former grow at a faster pace, while the latter grow more in absolute terms.…”

“…The instrument exploits the geographical variation in lightning strikes across subnational areas, based on the evidence that the mobile phone infrastructure (mainly the cell towers responsible for 3G signal emission, installed by mobile operators) is affected by frequent storms, as cloud-to-ground lightning strikes cause power surges making cell tower maintenance more costly (Manacorda and Tesei, 2020). While this instrumental variable approach has been previously used in empirical settings studying the effect of fast mobile internet on social phenomena, such as citizens' political mobilisation (Manacorda and Tesei, 2020) or trust in government (Guriev et al, 2021), a growing body of literature has employed the variation in lightning strikes to break the endogeneity between mobile internet diffusion and economic outcomes (Andersen et al, 2012;Mensah, 2021;Caldarola et al, 2022).…”

“…On the one hand, there is evidence that access to fast internet in sub-Saharan Africa has had a positive effect on employment (Hjort and Poulsen, 2019;Bahia et al, 2020Bahia et al, , 2021Caldarola et al, 2022), labour productivity growth (Hjort and Poulsen, 2019;Hjort and Tian, 2021), and firm entry (especially in the service sector), due to lower operation costs (Houngbonon et al, 2022). On the other hand, it has been acknowledged that digitalisation may lead to the concentration of benefits in larger firms, excluding smaller players (Altenburg et al, 2021), and that digital technologies can be labour saving or skill-biased technologies, favouring skilled workers over unskilled ones (Autor et al, 2003;Buera et al, 2021).…”