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Violence and Financial Decisions: Evidence from Mobile Money in Afghanistan

Author

Listed:
  • Joshua E. Blumenstock

    (University of California, Berkeley)

  • Michael Callen

    (London School of Economics)

  • Tarek Ghani

    (Washington University in St. Louis)

  • Robert Gonzalez

    (Georgia Institute of Technology)

Abstract

We provide evidence that violence reduces the adoption and use of mobile money in three separate empirical settings in Afghanistan. First, analyzing nationwide mobile money transaction logs, we find that users exposed to violence reduce use of mobile money. Second, using panel survey data from a field experiment, we show that subjects expecting violence are significantly less likely to respond to random inducements to use mobile money. Finally, analyzing nationwide financial survey data, we find that individuals expecting violence hold more cash. Collectively, this evidence suggests that violence can impede the growth of formal financial systems.

Suggested Citation

  • Joshua E. Blumenstock & Michael Callen & Tarek Ghani & Robert Gonzalez, 2024. "Violence and Financial Decisions: Evidence from Mobile Money in Afghanistan," The Review of Economics and Statistics, MIT Press, vol. 106(2), pages 352-369, March.
    • Handle: RePEc:tpr:restat:v:106:y:2024:i:2:p:352-369
    DOI: 10.1162/rest_a_01147
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    Cited by:

    1. Dominic Rohner, 2025. "Conflict," CESifo Working Paper Series 12035, CESifo.
    2. Ablam Estel Apeti & Jean-Louis Combes & Eyah Denise Edoh, 2023. "Entrepreneurship in developing countries: can mobile money play a role?," Working Papers hal-04081304, HAL.

    More about this item

    JEL classification:

    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • D14 - Microeconomics - - Household Behavior - - - Household Saving; Personal Finance

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