In India and elsewhere, mobile phones have become an intrinsic part of most people’s lives, connecting them to the rest of the world. A study entitled, ‘Mobile Technologies – The Digital Fabric of our Lives’, reveals how these small devices are economic heavyweights that positively influence social development. Conducted by the Cologne Institute for Economic Research (IER Cologne) on behalf of the Vodafone Institute for Society and Communications, the study reveals that India’s per capita GDP will grow by US$51 per year between 2010 and 2020 due to rising mobile phone subscriptions.
Over time, the report states that mobile subscriptions’ contribution to India’s GDP per capita growth will be 11.4% (2010-2012), 4.9% (2012-2015) and 2.1% (2015-2020). Mobile devices contribute to economic growth due to their increased use, which has risen sharply.
Econometric analyses were used to verify the correlation between mobile technology penetration and progress in social development. The study indicated that mobile phones support democratic participation, increase gender equality and improve education opportunities, while also making a significant contribution to economic growth.
Economists at IER Cologne calculated the percentage of economic growth that can be attributed to the increase in mobile phone subscriptions. The figure for India was 11.4% of per capita gross domestic product (GDP) between 2010 and 2012. According to the IER Cologne experts’ forecasts, mobile phones will continue to make a significant contribution to economic growth up to 2020.
The study includes a survey by Vodafone analysts, which states there will be an estimated 69 mobile phone subscriptions for every 100 Indians in 2020. Indian citizens began using mobile phones much later than Europeans. In India and South Africa, rising mobile phone subscriptions accounted for 11% of economic growth and almost 20% in Egypt, between 2010 and 2012.
The Vodafone Institute’s study revealed that mobile technology has an even stronger impact on economic systems in developing nations. In these countries, for the first time ever mobile phones allow people the opportunity to communicate and do business across long distances. The fact that people have better access to information due to mobile phones has a positive effect on economic growth. For example, farmers receive information about the day’s market prices or weather forecasts so they can make better decisions. Mobile communication infrastructure is a key one in these countries that allows establishment of economic institutions such as mobile banking services.
Worldwide, mobile phones are speeding up social development process, which was verified by using econometric methods. “The figures show that mobile technology isn’t just driving economic growth, but also social progress. Mobile phones are more than just communication tools. They give people the opportunity to participate in economic and social processes,” said Dr Mark Speich, Managing Director, Vodafone Institute for Society and Communications.
There is statistical evidence that more mobile phone subscriptions correlate with more democratic participation. This is particularly evident in countries where mobile technology penetration is still relatively low, which indicates that democratic processes in emerging markets gain from the more widespread use of mobile technology. In many cases, mobile phones are the only opportunity for people to participate in political organisations and obtain information about political developments.
Social progress also means an end to gender inequality. Statistics confirm that inequality declines as mobile technology availability soars. This effect is not as strong as the effect of mobile technology on democratic processes because mobile phones are just an ancillary component of the emancipation movement. They help women in developing countries to obtain medical advice when their children are sick, and to obtain information about job opportunities. These services are an important step towards empowering women within the family unit. Another positive effect of mobile technology is that women use their mobile phones to network with each other, providing them the emotional support required to assert their rights.
The scientists discovered that mobile phone adoption has a positive impact on education, especially in developing countries. For example, there is a statistically significant increase in the United Nations Education Index with a higher level of mobile phone subscriptions. More mobile phones mean better access to education. Development projects that explain crop growing and hygiene issues to people by SMS increase their level of education. Indirect effects have also been observed. Mobile phones help people coordinate their (family) lives better, leaving more time for education. The Education Index used for this analysis is part of the UN Human Development Index which measures the average number of years that children and adults spend in education in more than 180 countries.
The Vodafone Institute for Society and Communications was founded in 2011. With this study, it is publishing an initial overview of the central effects of mobile technologies on our lives. The study is based on an evaluation of data from various sources, one-to-one interviews with ten renowned experts and a global survey by Vodafone country experts.