Governance2.Org

During the late 1990s, an oft-repeated story about India’s mobile revolution featured fishermen in Kerala who used their mobile phones to call wholesale agents before reaching the shore to check market prices. Considering that mobile calls used to cost 20 cents a minute in those days and were obviously limited to the affluent, the story appeared apocryphal to some.
There is now a research that has mapped the benefits to those fishermen. The study, by Robert Jensen, a Harvard University economist, found that as mobile coverage increased in Kerala, fishermen’s incomes increased by 8%, fish prices fell by 4% on average and less wastage was created. It concluded that information makes markets work, and markets improve welfare.
It is this welfare function that the mobile phone revolution seems to be spreading across India, especially in rural areas. Mobile phones are making conventional economic transactions more cost- and time-efficient. They often make up for poor infrastructure by substituting for travel. They allow price data to be distributed and enable traders to engage with wider markets.
As India adds more than seven million subscribers every month, there is a distinct impact on the grass-roots economic landscape. Mobiles have played the role of a growth multiplier. From the roadside motor mechanic to the mason, the vegetable vendor or the illiterate housemaid, everyone is getting linked to his or her relevant marketplace. The farmer in the countryside can now base his harvesting decision on the regional commodity market rates he receives via text message, or plan his sowing in line with the weather forecast. Read on …