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The Poverty Reduction Effects of Mobile Broadband in Africa - Evidence from Nigeria (English)

The COVID-19 pandemic has brought home the salience of digital technologies as vital elements of today’s economic and social systems. Technology plays an integral role in spurring economic growth, helping to create new job opportunities, promote greater efficiency and generate innovation. Mobile technology constitutes the primary, and often only, method of digital access for people around the world, with almost 4 billion mobile broadband subscribers globally. It plays a particularly important role in Africa, where a large majority of people access the internet through mobile phones rather than through fixed broadband. That said, Africa also lags in the rollout of mobile broadband infrastructure. Almost a quarter of the continent’s population is not covered by a mobile broadband network and almost three quarters do not use mobile internet, meaning they are unable to benefit from the digital revolution that has swept across the world over the past two decades. To answer this question, the GSMA and the World Bank developed an innovative, ground-breaking study to subject to empirical scrutiny the impact of mobile broadband on welfare and poverty reduction, using data from Nigeria, the largest mobile market and economy in Africa. The analysis shows that having at least one year of mobile broadband coverage increases total consumption by about 6 percent. This estimate reaches 8 percent after two years of coverage. Similarly, the proportion of households below the extreme poverty line, 1.90 dollars per day, drops by about 4 percentage points after one year of gaining mobile broadband coverage and by about 7 percentage points after two or more years of coverage. This corresponds to moving approximately 2.5 million people out of extreme poverty. The study also shows that rural households stand to gain more than urban households from such benefits in relative terms.

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Citation

Bahia, Kalvin Castells, Pau Cruz,Genaro Masaki,Takaaki Pedros, Xavier Pfutze,Tobias Rodriguez Castelan,Carlos Winkler,Hernan Jorge

The Poverty Reduction Effects of Mobile Broadband in Africa - Evidence from Nigeria (English). Washington, D.C. : World Bank Group. http://documents.worldbank.org/curated/en/967701607055542906/The-Poverty-Reduction-Effects-of-Mobile-Broadband-in-Africa-Evidence-from-Nigeria