Mobile Phone Ownership and Welfare: Evidence from South Africa's Household Survey

29 Pages Posted: 5 Jan 2021

See all articles by Ken Miyajima

Ken Miyajima

Bank for International Settlements (BIS) - Monetary and Economic Department

Date Written: October 1, 2020

Abstract

Digitalization is accelerating as countries fight against the COVID-19 pandemic. In this context, the impact of mobile phone ownership on welfare (represented by consumption) is estimated for South Africa using rich household survey data in a panel format, the National Income Dynamics Study (NIDS) with 5 waves spanning 2008-17. The literature argues mobile phone ownership facilitates greater and more affordable access to information and generate welfare gains. We attempt to disentangle the two-way relationship between consumption and mobile phone ownership, which is inherently difficult, and add to the literature by investigating distributional effects. Estimated results suggest that consumption of mobile phone owners tends to be 10-20 percent above that of non-owners. Benefits tend to accrue more on individuals with relatively low levels of consumption, potentially as a greater number of new users, likely with higher marginal positive effects on consumption, and a faster rate of user cost reduction help reap greater gains.

JEL Classification: O12, O55, E21, E42, C13, I20, E25

Suggested Citation

Miyajima, Ken, Mobile Phone Ownership and Welfare: Evidence from South Africa's Household Survey (October 1, 2020). IMF Working Paper No. 20/222, Available at SSRN: https://ssrn.com/abstract=3758055

Ken Miyajima (Contact Author)

Bank for International Settlements (BIS) - Monetary and Economic Department ( email )

Centralbahnplatz 2
CH-4002 Basel
Switzerland

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