Abstract:
Many developing country governments and developing agencies are focusing on extending telecommunications services into rural areas, as they seek to alleviate poverty, encourage economic and social growth, and overcome a perceived ‘digital divide’. However, relatively little is known about how rural communities benefit from modern telecommunications services and what impact it is having on their lives and livelihoods. This paper endeavors to redress the balance, by examining the role of mobile telephones in sustainable poverty reduction among the rural poor. In the first section, we ask three questions: (a) Why are the rural poor important?; (b) What is information and why is it important?; and (c) Is the mobile telephone the most appropriate delivery mechanism for that information? In the second section, we look at the current status of the mobile industry in both the developed and developing world: (a) we consider the ‘explosive’ growth in availability and affordability of mobile phone services, which has been high in the developed world, but is gaining speed in the developing world; and (b) we examine the role of the private sector in this impressive growth. In the third section, we drill down into the impact of mobile telephony. We begin by examining the perceived correlation between GDP per capita and mobile penetration. Then we turn our attention to the examination of channels through which mobile phones benefit the rural poor: (a) direct benefits; (b) indirect benefits; and (c) intangible benefits, which contains an overview of hard-to-measure, rarely discussed but relevant, benefits of mobile telephony: namely, disaster relief, dissemination of locally-generated and locally- relevant educational and health information, and social capital or social cohesion. In the fourth section, we review several emerging global trends that may change the use and impact of mobile telephony in rural areas. Finally, the fifth section summarizes and interprets the main conclusions.
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