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Network adoption subsidies: A digital evaluation of a rural mobile phone program in Rwanda

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  • Björkegren, Daniel
  • Karaca, Burak Ceyhun

Abstract

Governments commonly target subsidies for communication networks in remote areas. We analyze a program in Rwanda that subsidized the equivalent of 8% of the stock of mobile phones, using 5.3 billion transaction records. Handsets mostly stayed in rural areas: 85% of accounts receiving subsidized handsets mostly use a rural tower. Subsidized handsets were used as much as purchased handsets. Recipients are highly connected to each other. We simulate welfare effects using a network demand system. Up to 69% of the impact on operator revenue comes from spillovers on nonrecipients. We also assess counterfactual targeting based on network properties and vouchers.

Suggested Citation

  • Björkegren, Daniel & Karaca, Burak Ceyhun, 2022. "Network adoption subsidies: A digital evaluation of a rural mobile phone program in Rwanda," Journal of Development Economics, Elsevier, vol. 154(C).
    • Handle: RePEc:eee:deveco:v:154:y:2022:i:c:s0304387821001255
    DOI: 10.1016/j.jdeveco.2021.102762
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    Keywords

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    JEL classification:

    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • L96 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Telecommunications

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