mobile money

Mobile broadband has also been linked with positive financial inclusion outcomes (Hasbi and Dubus 2019).

The study finds evidence of a labor market mechanism through which mobile broadband internet could be translating into improvements in welfare. The expansion of digital infrastructure and access to the internet may not only help the creation of jobs in the information and communication technology (iCT) sector but also reduce transaction costs for people in finding jobs, for productive inputs, or for improved labor productivity (World Bank 2016). The effect of mobile broadband technologies on wage/salaried or formal employment is of particular interest because a shift away from informal self-employment toward more productive wage/salaried or formal employment in private and public services is deemed to be a potential pathway to reducing poverty rates in Africa (World Bank 2016, 2019b). The study finds that 3g coverage is positively correlated with employment in “better” jobs—or formal, wage/salaried jobs with higher earnings.17 These findings are consistent with other studies (for example, Bahia et al. 2020; Hjort and Poulsen 2019) showing similar results, namely, that access to the internet translates into increased employment in wage or higher-skilled jobs. The finding draws attention to the potential role that DTs can play in improving labor outcomes— and, particularly, employment in “better” jobs.

PRODUCTIVE USE OF THE INTERNET: THE CASE OF EXPANDING ACCESS TO MOBILE MONEY

The internet can facilitate access to markets and information to households, both as producers and consumers, contributing to an expansion of their welfare. from a consumer perspective, the internet is often employed as a source of news, to engage in e-commerce and do research on purchases, for paying utilities online, and for accessing government services such as telemedicine or health information. from an income-generating activity view, the internet can provide market-related information to farmers, enable small business transactions, and aid in job searches. importantly, the internet can facilitate access to the financial system, benefiting both consumers and producers. it also enables people to communicate with each other, through email and chat, as well as to engage in social media. The internet can also be a platform for leisure activities, such as online games.18

Expanding mobile money in Senegal could help reduce horizontal inequalities in digital financial services and provide access to capital to a larger share of the population. Doubling the current share of mobile money users in Senegal from 31.8 percent to 63.6 percent—in alignment with one of the main targets of a World Bank operation for WAEMU—can have significant welfare implications, according to a simulation exercise (see box 2.1). Expanding access to mobile money accounts can reduce horizontal inequality in the use of mobile money, such as by gender, location, or income. Specifically, women’s ownership increases from 29 percent to 57 percent, access to accounts in rural areas increases from 27 percent to 62 percent, and the mobile money gap between the poorest and richest income quintiles is reduced by 5 percentage points, according to simulation results. improved access promoted by lower transaction costs can lead to an estimated 70 percent increase in remittances transactions, and twice the private payments related to labor activities. in the long run, increased access to digital