MobileActive.org

The authors study the economic effects of the roll-out of mobile phone network coverage in rural South Africa, addressing identification issues which arise from the fact that network roll-out cannot be viewed as an exogenous process to local economic development.

The authors combine spatially coded data from South Africa's leading network provider with annual labor force surveys, and use terrain properties to construct an instrumental variable that allows us to identify the causal effect of network coverage on economic outcomes under plausible assumptions. 

The study finds substantial effects of cell phone network roll-out on labor market outcomes with remarkable gender-specific differences. Employment increases by 15 percentage points when a locality receives network coverage. A gender-differentiated analysis shows that most of this effect is due to increased employment by women. Household income increases in a pro-poor way when cellular infrastructure is provided.