New GSMA publication on how mobiles contribute to economic growth

The GSM Association, together with Deloitte and Cisco have recently published a useful report (.pdf 3.4 MB) on the contribution of mobiles to economic growth, and they intend to run their analysis on an annual basis so as to provide a barometer of change in the industry and its impact.

Some of the key findings of the report include:

  • For a given level of total mobile penetration, a 10% substitution from 2G to 3G penetration increases GDP per capita growth by 0.15% points
  • A doubling of mobile data use leads to an increase in the GDP per capita growth rate of 0.5% points
  • A 10% increase in mobile penetration increases Total Factor Productivity in the long run by 4.2% points

The Appendices provide much more detail about the precise econometric models used, and it is good to see such detail and transparency.  I retain some concerns, though, about the ways in which causality is imputed from what are essentially relationships between economic indicators.  This could be the basis of an interesting dialogue about methodologies for undertaking such research, which I guess would depend heavily on ideological premises!  However, using this as a starting point, it would be interesting to drill down in more detail to ask what factors need to be in place for the economies of particular countries to follow the general observations noted.  From my perspective, we need to learn more about what some of the poorest countries and peoples can do to ensure that they too benefit.  In other words, we need to disaggregate the data, and understand in detail about the wider governance structures, infrastructure and social conditions that need to be in place to enable growth.  That is, of course, if economic growth is of prime concern!



Filed under 'phones, ICT4D

2 responses to “New GSMA publication on how mobiles contribute to economic growth

  1. Tim – would be interested to hear more about your thoughts on causality vs correlation. To be fair I haven’t READ the article yet (hmm maybe I should be a Daily Mail reviewer… No, I have printed it off, that’s probably too close to a knowledgeable opinion for the Mail) but even just reading the summary above, my first thought was “Yeh sounds interesting but surely its just as likely that the increase in GDP caused/allowed-for the increase in mobile usage… or that the both are simply correlates of economic growth in general…” – although obviously I will see what I think after reading it! 😉

    • Tim Unwin

      Matt – I think we agree. All too often correlations are given explanatory power, when all they do is describe relationships.

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