Mobile technology and its role in ending of poverty

If you ever travel to the heart of Africa, you will likely experience a kind of poverty that you had hoped, somehow, only existed in National Geographic photos and child sponsorship ads. But, the poverty is, indeed, very real. And, even though you've seen the photos and watched the ads that have come to define Africa, you will be no less shocked at the heart-wrenching reality of the poverty that inhabits her daily existence.

Because of this reality, luxuries that draw little attention in the United States (largely because they are no longer heralded as "luxuries"), stand out in surprising contradiction. To me, the most common contradiction in lifestyle was the prevalence of cell phones. In larger cities, they are everywhere. And, even in villages, they are popular. But, the Sub-Saharan African cell phone does not share the same history with the mobile devices of the United States. Industry knew that the African market existed in the masses. Thus, cell phones in this region are cheap and accessible and widely used for communication (particularly through texting). So, what if Industry could leverage the mass market in order to alleviate poverty through mobile devices and the amazing power of instant communication? According to an article in The Economist entitled, "A Hill of Soyabeans", they can.

"By examining historical data for the price of fish as mobile-phone coverage was extended ...Robert Jensen of Harvard University showed that access to mobile phones made markets much more efficient, eliminating wasted catches and thereby bringing down consumer prices by 4% and increasing fishermen’s profits by 8%. Similarly, Jenny Aker of the University of California at Berkeley analysed grain markets in Niger to see how the phasing-in of mobile-phone coverage between 2001 and 2006 affected prices. She found that it reduced price variations between one market and another by at least 6.4%, and more in remote and hard-to-reach markets. With transaction costs cut, prices for consumers were lower and profits for traders higher."

And, equally as promising results have been found in internet kiosks.

"By the end of 2004 a total of 1,704 kiosks had been set up...The kiosks displayed the minimum and maximum price paid for soyabeans at 60 mandis, updated once a day, along with agricultural information and weather forecasts. ITC [and Indian company] also posted the price it was prepared to pay for soyabeans of a particular quality bought direct from farmers at 45 “hubs” (mostly in the same towns as mandis). By setting up the kiosks, ITC enabled farmers to check that the prices being offered at their local mandi were in line with prices elsewhere. It also gave them the option to sell direct...As expected, the availability of price information increased the level of competition between the traders, raising prices and reducing the variation in prices between nearby mandis. Farmers’ profits increased by 33%, and the cultivation of soyabeans increased by an average of 19% in districts with kiosks."

I don't pretend to have a solution to end the crisis of poverty. I won't pretend to understand the agony that rests in its grip. But, I am encouraged by the knowledge that there are, in fact, innovative solutions to move us closer to poverty's end. What steps can we take today? Read the rest of The Economist article here:
www.economist.com/businessfinance/economicsfocus/displaystory.cfm?story_id=15211578