The author systematically examines one of the important issues of information — establishing the market price. He introduces the concept of «search» — where a buyer wanting to get a better price, is forced to question sellers. The article deals with various aspects of finding the necessary information.

Economics of Information

This paper reviews roughly 200 recent studies of mobile (cellular) phone use in the developing world, and identifies major concentrations of research. It categorizes studies along two dimensions. One dimension distinguishes studies of the determinants of mobile adoption from those that assess the impacts of mobile use, and from those focused on the interrelationships between mobile technologies and users. A secondary dimension identifies a subset of studies with a strong economic development perspective. The discussion considers the implications of the resulting review and typology for future research.

Research Approaches to Mobile Use in the Developing World: A Review of the Literature

Alongside good governance, technology is considered among the greatest enablers for improved quality of life. However, the majority of its benefits have been concentrated in industrialized nations and therefore limited to a fraction of the world's population. We believe that technology has a large role to play in developing regions, that "First World" technology to date has been a poor fit in these areas, and that there is thus a need for technology research for developing regions. Despite the relative infancy of technology studies in developing regions, anecdotal evidence suggests that access to technology has a beneficial economic impact. Cellular telephony is probably the most visible application, but there are many others, some of which we cover in this article. The World Bank's infoDev site catalogs hundreds of information and communications technologies (ICT) projects, albeit not all successful. Most of these projects use existing off-the-shelf technology designed for the industrialized world. Although it is clear that there are large differences in assumptions related to cost, power, and usage, there has been little work on how technology needs in developing regions differ from those of industrialized nations. We argue that Western market forces continue to meet the needs of developing regions accidentally at best.

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The case for technology in developing regions

There is considerable speculation about the correlation between investments in telecommunications and economic development. Mobile phones, by virtue of their role as carriers and conduits of information, ought to lessen the information asymmetries in markets, thereby making rural and undeveloped markets more efficient. This research tests this assumption using a case-study from India, where the fishing community in the south-western state of Kerala has adopted mobile phones in large numbers. We find that with the wide-spread use of mobile phones, markets become more efficient as risk and uncertainty are reduced; there is greater market integration; there are gains in productivity and in the Marshallian surplus (sum of consumer and producer surplus); and price dispersion and price fluctuations are reduced. The potential efficiencies are, however, subject to easy access to capital, without which the market remains less efficient than it could be. Finally, the quality of life of the fishermen improves as they feel less isolated, and less at risk in times of emergencies.

Mobile Phones and Economic Development: Evidence from the Fishing Industry in India

Using data from developing countries, this paper examines the links between ICT diffusion and per capita income, trade and financial indicators, education, and freedom indicators. Internet hosts, Internet users, personal computers and mobile phones represent indicators of ICT. The Gompertz model of technology diffusion is used to study ICT dissemination. The results show that income and government trade policies influence ICT diffusion. However, freedom indices may or may not affect ICT diffusion. Moreover, only personal computers and Internet hosts seem to have a positive association with income. Contrary to expectations, ICT diffusion is not associated with education.

An analysis of the determinants and effects of ICT diffusion in developing countries

The intent of the present study is to evaluate the role of telecommunications within the contexts of rural development in general and of poverty reduction in particular. Bangladesh has been selected as a case study due to the uniqueness it displayed in an innovative program for expanded telecom infrastructure, in which Grameen Bank (GB) of Bangladesh, the village-based micro-finance organization, leased cellular mobile phones to successful members. GB calls these phones Village Pay Phones (VPPs). The effects of VPPs are assessed from two angles:sellers of services (telephone lessees/owners) and buyers of services (villagers). The findings of the study lead to two basic conclusions: first, pursuance of pragmatic policies can turn telephones into production goods, especially through lowering transaction costs, and second, the services originating from telephones in villages are likely to deliver significant benefits to the poor. VPPs also seems to have perceptible and positive effects on the empowerment and social status of phone-leasing women and their households. For villagers in general, phones offer additional non-economic benefits such as improved law enforcement, more rapid and effective communications during disasters, stronger kinship bonding, etc. GB’s style of managing communications can help significantly to expand access to this vital information input for all segments of the population, reduce inequality and thus enhance the broad-based, pro-poor orientation of rural development activities.

https://www.econstor.eu/bitstream/10419/84729/1/zef_dp08.pdf

Rasheda Akhter

Papers

Village Pay Phones and Poverty Reduction: Insights from a Grameen Bank Initiative in Bangladesh