Risk and Reciprocity Over the Mobile Phone Network : Evidence from Rwanda

@inproceedings{Blumenstock2011RiskAR,
  title={Risk and Reciprocity Over the Mobile Phone Network : Evidence from Rwanda},
  author={Joshua Evan Blumenstock and Nathan Eagle and Marcel Fafchamps},
  year={2011}
}
A large literature describes how local risk sharing networks can help individuals smooth consumption in the face of idiosyncratic economic shocks. However, when an entire community faces a large covariate shock, and when the transaction costs of transfers are high, these risk sharing networks are likely to be less effective. In this paper, we document how a new technology – mobile phones – reduces transaction costs and enables Rwandans to share risk quickly over long distances. We examine a… CONTINUE READING