Benefits of telecom at the BOP?

Posted on May 26, 2008  /  1 Comments

LIRNEasia’s Lead Economist presented the findings on the percieved benefits of telecom access at the bottom of the pyramid at ‘The Global and Globalizing Dimensions of Mobile Communication: Developing or Developed‘ a pre-conference program at the ICA 2008 conference in Montreal on 20-21 May 2008.

The paper presented, ‘Perceived economic benefits of telecom access at the Bottom of the Pyramid in emerging Asia‘ takes a look at what BOP phone owners gain from telecom access from their own perspective. One of the most interesting findings here, is that although they see efficiency gains stemming from phone access/use, they don’t relate these to economic gains. This is puzzling, because we know from macro-level studies that a positive relationship exists between phone penetration and national income; additionally, theory suggests that for example saving time or a physical trip to convey a message or obtain information, can translate to economic savings. However, there seems to be some kind of ‘disconnect’ in BOP perceptions of the value of a phone. Johnathan Donner also finds a similar disconnect in his study of the use of ICTs among small and informal businesses in India. While some notable recent micro-level studies have actually managed to quantify the benefits that a phone can have in the Indian fisheries and Sri Lankan agriculture sectors, what the discussions at the pre-conference in Montreal seemed to converge towards is that in these emerging/developing markets, small-time businesses prefer face-to-face interactions for their dealings; trust is still an issue in these kinds of settings. This is an interesting area for futher study (which we hope to do in Teleuse@BOP3) and discussion, and especially in the coming era of mobile payments, trust will play an important role: will people trust an SMS confirmation as opposed to a hand-to-hand transfer of money?

Comments and discussion are invited.

1 Comment

  1. does not work. This may not be lirneasia’s responsibility. But why can’t someone make it work?