ICTworks

Many scholars have hailed the mobile phone as a tool to give farming in developing countries a new impetus. However, studies on the impact of mobile phones in general, and specific mobile phone initiatives (m-services), have shown mixed results. Research has not been able to consistently show how farmers – in particular the poor – are influenced by the adoption and use of a mobile phone.

Merijn van Baardewijk‘s research paper, “Is the mobile phone the panacea for rural poverty?” for Utrecht University, uses a novel approach to assess the impact of mobile phones on poor farmers. The analysis was based on Duncombe‘s (2014) suggestions to make the livelihoods approach more suitable for the impact of ICT. The framework shifts the emphasis to less tangible assets, making a distinction between resource-, cognitive-, and network-based assets.

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This research has given a more detailed picture of the impact of mobile phones on poor farmers. It has proven to be useful to shift the emphasis to less tangible assets because it is here that these effects are most keenly felt. However, this research also shows the difficulties in accurately measuring these particular assets.

3 Direct Benefits of Mobile Phones

A case study was done on poor farmers that make use of IKSL’s green SIM, an m-service that sends farmers daily voice messages with agricultural information. 45 in-depth interviews were held around Lucknow, India. A counterfactual consisted of richer farmers, as well as farmers without the green SIM.

The respondents differ in their asset endowment, context of vulnerability and livelihood strategies. Many of the respondents’ households appear to be “hanging on”; they use their assets to maintain their current living conditions, rather than improving it.

Some households are “stepping up”; they have invested in education, or saved money to diversify their livelihoods. Such farmers have higher income, better social networks and more access to agricultural knowledge.

Despite the heterogeneity within the sample, most respondents use the mobile phone in similar ways. Because farmers’ resource endowment does not influence phone usage, mobile phones form useful tools for development.

1. Reduce Transaction Costs

Probably the greatest benefit of the mobile phone is how it used as a substitute for travelling, thereby reducing transaction costs associated with marketing.

• Farmers have more accurate and timely knowledge about market rates, because they frequently call someone at the market. This knowledge can be used, not for bargaining with traders, but to time their sales better and receive higher prices.
• Farmers can sell their products more quickly. Whenever they harvest their crops, they call for traders to come, rather than wait for them. This is particular useful for perishable crops and farmers with limited storage space.
• Farmers sell their crops more easily directly to consumers because of the phone. This gives them more bargaining power and eliminates the margin that the trader absorbs. However, these sales make only a small part of their total sales.

The extent to which these effects result in income gains is difficult to measure, because they are presumably small, farmers do not keep a record, and the effects are obscured by the large variations in farmers’ income. Nevertheless, these mechanisms enrich the existing understanding of the effects of mobile phones on farmers’ income.

2. Increase Access to Resources

The mobile phone can also be seen as enhancing farmers’ current access to resources. The phone is used to attract knowledge that increases land- and labour- productivity.

The level of increased productivity is moderate, because the mobile phone does not lead to the search for new knowledge. Much of the knowledge has always been available from a multitude of sources, such as radio and TV, as well as face-to-face communication with shopkeepers and in some cases government officials.

Much more important than access to new knowledge, is the access to better knowledge the phone provides. Knowledge about markets, the weather or how to deal with specific pests that are gained through shopkeepers, friends and family are not always up-to-date and reliable.

3. Stronger Social Networks

Respondents also reported that their social networks have improved, in particular relationships with friends and family in far-off places. Independent of the type of SIM, phones enhance farmers’ social networks, both with friends and family, as well as looser ties such as with shops and acquaintances.

The strengthening of these networks is not only a purpose in itself, but can result in additional benefits. For example, when an emergency occurs farmers can call a relative to come help, or when a farmer needs something from a shop he can ask his friend to bring it. It seems that due to the phone, farmers are more inclined to ask each other for favours. It seems, then, that the phone might improve social cohesion within communities.