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Airtime transfers and mobile communications: Evidence in the aftermath of natural disasters

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  • Blumenstock, Joshua E.
  • Eagle, Nathan
  • Fafchamps, Marcel

Abstract

We provide empirical evidence that Rwandans use the mobile phone network to transfer airtime to those affected by unexpected shocks. Using an extensive dataset on mobile phone activity in Rwanda and exploiting the quasi-random timing and location of natural disasters, we show that individuals make transfers and calls to people affected by disasters. The magnitude of these transfers is small in absolute terms, but statistically significant; in response to the Lake Kivu earthquake of 2008, we estimate that roughly US$84 in airtime was transferred to individuals in the affected region, that 70% of these transfers were immediately used to make outgoing calls, and that US$16,959 was spent calling those near the epicenter. Unlike other forms of interpersonal transfers, mobile airtime is sent over large geographic distances and in response to covariate shocks. Transfers are more likely to be sent to wealthy individuals, and are sent predominantly between pairs of individuals with a strong history of reciprocal favor exchange.

Suggested Citation

  • Blumenstock, Joshua E. & Eagle, Nathan & Fafchamps, Marcel, 2016. "Airtime transfers and mobile communications: Evidence in the aftermath of natural disasters," Journal of Development Economics, Elsevier, vol. 120(C), pages 157-181.
  • Handle: RePEc:eee:deveco:v:120:y:2016:i:c:p:157-181
    DOI: 10.1016/j.jdeveco.2016.01.003
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    Cited by:

    1. Daniel Björkegren, 2017. "Scoping for: Competition in Network Industries: Evidence from Mobile Telecommunications in Rwanda," Working Papers 17-10, NET Institute.
    2. Joshua Blumenstock & Michael Callen & Tarek Ghani, 2017. "Why Do Defaults Affect Behavior? Experimental Evidence from Afghanistan," NBER Working Papers 23590, National Bureau of Economic Research, Inc.
    3. repec:eee:ecoedu:v:59:y:2017:i:c:p:29-42 is not listed on IDEAS
    4. Eduardo Nakasone & Maximo Torero, 2016. "A text message away: ICTs as a tool to improve food security," Agricultural Economics, International Association of Agricultural Economists, vol. 47(S1), pages 49-59, November.
    5. Parag Mahajan & Dean Yang, 2017. "Taken by Storm: Hurricanes, Migrant Networks, and U.S. Immigration," Working Papers 17-50, Center for Economic Studies, U.S. Census Bureau.
    6. Takahashi, Kazushi, 2016. "Mobile Phone Expansion, Informal Risk Sharing, and Consumption Smoothing: Evidence from Rural Uganda," MPRA Paper 75135, University Library of Munich, Germany.
    7. Blumenstock, Joshua & Callen, Michael & Ghani, Tarek, 2017. "Why Do Defaults Affect Behavior? Experimental Evidence from Afghanistan," CEPR Discussion Papers 12142, C.E.P.R. Discussion Papers.
    8. Parag Mahajan & Dean Yang, 2017. "Taken by Storm: Hurricanes, Migrant Networks, and U.S. Immigration," NBER Working Papers 23756, National Bureau of Economic Research, Inc.

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