Oct 15, 2010

Curious Case of Mobile Phones Lifting Poverty

Article first published as Curious Case of Mobile Phones Lifting Poverty on Technorati.

Last year a cinema was released in Hollywood named, “A curious case of Benjamin Button” that won nomination for Oscar awards. It tells the story of Benjamin Button, who starts aging backward. He takes birth as an old man and dies as an infant. One can understand that such things are only possible in movies. It is quite unnatural. Winning nomination for best picture category is another surprise.

UNCTAD_logo Yesterday, on October 14, a UN study revealed a curious case of Cell phones. It said mobile phone could improve the livelihoods of poorest people in developing countries. UNCTAD, United Nations Conference on Trade And Development said in its information economy report “Mobiles have spawned a wealth of micro-enterprises, offering work to people with little education and few resources.” It advised Governments to monitor how poor people were using mobile phones and design policies to build on that.

This is a curious case of mobile phones lifting poverty instead of policies of the government that enable poor to have honorable employment. The UNCTAD’s suggestion is somewhat like tail wagging the dog. Mobile phones are no doubt a revolutionary invention that enables people to get information faster than before.

But, what information is shared by poor people through mobile phones? Small business people can order products and get them next day. Previously land phone did the same job. Transport facilities in the poorest areas of the least developed countries have not yet been developed as pointed out by the same report. And, the small business people are not poorest people, and they are placed above poverty line in developing and LDC nations.

The report said with the help of mobiles micro-enterprises offered work to people with little education and few resources. It should be noted that offering work is need of the micro-enterprises, and with the mobiles, they are able to gather workers in a bit faster way. Here, the gainers are micro-enterprises but not workers.

Workers will be offered work, as long the institutions have work to offer. Beyond their need, they cannot offer any work. If more working hours are offered with the use of mobiles, such credit can be attributed to mobile phones. But here, the number of working hours or days is not altered. The poorest are offered the same work as before but a bit earlier. That doesn’t increase earnings of the poorest.

Moreover, advising governments to monitor how people are using mobile phones and design policies to build on that is again the case of tail wagging the dog. This advice can be suitable for banks and insurance companies, which can offer mobile banking or mobile paying services. But, the poorest are not allowed into banks’ premises now a days. Minimum balance required is something what they do not earn per even a month. Insurance companies issues cheques that cannot be cashed by the poorest, who doesn’t possess bank accounts.

Mobile phones and internet are only technological tools that help speed up the businesses, exchange of information in shorter periods. They can help passing the information of polices but they cannot decide how the policies are formulated. The study of UNCTAD is something that is deceiving and beyond the facts on the ground.

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