Vodafone on the impact of mobiles in India
23 January 2009

Vodafone has released a new set of studies on mobiles in India as part of their Policy Paper Series. This follows important earlier volumes in the same series on Africa and M-transactions (among others). The document includes four research papers:

Kathuria, Uppal, and Mamta offer an econometric analysis of the impact of mobile.  The background sections of this paper present a clear and remarkable history of the rapid spread of mobile telephony in India.  Their theoretical contribution is a model linking mobile penetration to GNP growth at the state level (similar to what Waverman, Meschi & Fuss did in the 2005 Africa Volume in the same series.  I’m not enough of an econometrician to offer an opinion on the strength of the model, but the attempt is made to control first for the (strong) impacts of gross State Domestic Product (GSDP) on mobile use, thus isolating the impacts of rising mobile penetration on GSDP.  They suggest that “a 10% increase in mobile penetration delivers, on average a 1.2% point annual increase in output”.  They also find a threshold effect, suggesting that the positive benefits of mobiles on growth kick in disproportionately in states with higher-than-the-median penetration of 25%.

Gandhi, Mittal, and Tripathi, explore the impact of mobiles on agricultural productivity. This paper presents the results of interviews and focus groups with the users of Reuters Market Light (RML) and another market information system, IKSL, run by the Indian Farmers Cooperative Limited. It is a helpful paper, describing the priorities farmers and fishermen have for information services.  They also delve into farmers’ basic uses of mobiles for work purposes, breaking out benefits of content, mobility, and connectivity (time and travel savings). This offers a significant improvement over some other papers, which tend to conflate mobility and connectivity.   Finally, I like the way the paper mentions constraints – both that phones do not replace face to face interactions (see also Donner and Molony and Overå), and that for all the connectivity in the world, some farmers and fishermen would still face significant infrastructure barriers to acting on that information, such as the lack of roads to transport goods to market.

Sarin and Jain report the results of a survey of usage of mobile in poor urban areas. This paper has some interesting elements, particularly around observed differences in mobile use by gender (men own the phones in many households), and in the assertion that “users and non-users in some sense inhabit different networks, with users much more likely to be in networks with higher mobile usage”.  However, some methodological choices made by the researchers make it difficult to draw many generalizable insights from the survey. Users and non-users are demographically different (a point they acknowledge), but the report is just a series of comparisons of users and non-user self reports, with no statistical controls to account for demographic differences. In addition, (and unless I’m mistaken in my read of the paper), in many cases, users and non-users were asked distinctly different questions. While nonusers were asked ‘baseline’ questions about changes to productivity, earnings, social networks, etc. over the last year, users were asked specifically how the mobile altered these various elements.  This makes comparison quite difficult, and I would have preferred to see the same baseline wording used in the nonuser and user groups.  That said, there is probably a lot that can be done with the survey data (1700 cases!) 

Uppal, M., & Kathuria, R. (2009) consider the impact of mobiles in the SME sector. They touch on a question near and dear to me, so I’m happy to see other researchers focusing on SMEs and microenterprises.  However, while, there are a few anecdotes on subsectors of the informal economy (such as vegetable vendors) and some good sidebars on the mobile-power success stories of individual entrepreneurs. This is more of a forward-looking commentary than a traditional research paper. Perhaps its most important contributions are the examples of mobile-enabled businesses such as labornet, just dial, and radio cabs. These are larger organizations than MSEs, but mobile connectivity is at their core. The paper is worth a read if only for these examples.