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Interoperability Between Mobile Money Agents and Choice of Network Operators: The Case of Tanzania

Author

Listed:
  • Grzybowski Lukasz

    (Faculty of Economic Sciences, University of Warsaw, 44/50 Dluga Street, 00241, Warsaw, Poland)

  • Lindlacher Valentin

    (TU Dresden, Ifo Institute Munich & CESifo, Helmholtzstr. 10, 01069, Dresden, Germany)

  • Mothobi Onkokame

    (School of Governance, University of Witwatersrand, 2 St Davids PI, Parktown, Johannesburg, South Africa)

Abstract

In this paper, we investigate the effects of non-exclusive agreements between networks of mobile money agents on mobile network operator choices, using survey data from Tanzania conducted in 2017. By combining survey responses with geo-location data and information on agent proximity, we employ discrete choice models to analyze consumers’ decisions in subscribing to mobile network operators and their corresponding mobile money providers. Our findings highlight the significant influence of the distance to mobile money agents on consumers’ subscription choices. To explore the impact of interoperability (non-exclusivity) at the mobile money agent level, where consumers can use the nearest agent from any mobile money provider, we assess its effects on market shares of mobile network operators. Our results indicate that interoperability at the agent level has only a minor impact on market shares. Smaller operators experience marginal gains as their consumers can now utilize agents of larger providers, which are often closer in proximity. In conclusion, we find that interoperability at the agent level does not considerably alter the market structure in the context Tanzania during the period under consideration.

Suggested Citation

  • Grzybowski Lukasz & Lindlacher Valentin & Mothobi Onkokame, 2023. "Interoperability Between Mobile Money Agents and Choice of Network Operators: The Case of Tanzania," Review of Network Economics, De Gruyter, vol. 22(1), pages 27-52, June.
    • Handle: RePEc:bpj:rneart:v:22:y:2023:i:1:p:27-52:n:3
    DOI: 10.1515/rne-2023-0024
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    More about this item

    Keywords

    mobile money; interoperability; M-Pesa; Tanzania; mobile networks;
    All these keywords.

    JEL classification:

    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • L86 - Industrial Organization - - Industry Studies: Services - - - Information and Internet Services; Computer Software
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications

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