Mobile phone use in Africa: Implications for inequality and the digital divide

Traditional consumer theory assumes that welfare occurs at the point where a good is purchased, and this assumption forms a central part of standard neoclassical welfare analysis. This note argues by contrast that the use of products (including technologies) is also a fundamental determinant of the welfare effect of adopting mobile phones in developing countries. To show this, I rely on a new and detailed data set for 11 African countries and reach some important—albeit tentative—conclusions about the consequences of introducing mobile phone use into existing literatures. In particular, this variable offsets the degree of inequality measured only by adoption and reduces the digital divide as compared to the conventional measure.