Mobile Phones in Developing Countries

Jerry Hausman
Zhong Liu
Publication Type: 
Working Papers
Publication Article File: 
Publication Year: 
Mobile phone networks have been in operation for about 30 years. Penetration is now rapidly increasing in even quite poor countries. Adoption of money transfer networks using mobile phones has also arrived, such as M-PESA which is a mobile based banking network which allows inexpensive money transfer operates in Kenya. Money transfer using mobile phone exists in other countries in both Africa and elsewhere. We estimate the compensating variation that arises with the use of mobile money transfer networks, which has not previously been done.
Another goal of this paper is to quantify benefits that arise with mobile networks in LDCs. The improvement in consumer welfare seems of the same order of magnitude or even larger than many aid programs discussed in policy deliberations and in the development economics literature. We also consider within country and between country welfare comparisons.
JEL Codes: 
D04, D12, H11
Mobile Financial Services