Photo Credit: One Africa
What is the impact of internet coverage (access) on individual living standards (poverty and employment) in Nigeria -- a country with one of the poorest people in the world?
Recently, Kalvin Bahia, a principal economist at GSMA and seven others conducted a research to provide insight on the impact of internet coverage on living standards. His study mainly uses the General Household Survey (GHS) and data on mobile broadband coverage 2010 -2016 obtained from Nigerian mobile operators.
The research findings reveal that internet coverage reduced the number of households living below the poverty line by about 4.3% for extreme poverty, and 2.6% for moderate poverty within a 12-month period. Note: extreme poverty covers individuals depending on less than $1.90 or N684 per day, and moderate poverty covers individuals depending on less than $3.20 or N1,152 per day). In addition, the number of people in the job market and those on salaried employment increased by about 3.3% and 1.4% respectively within 3-4 years due to internet coverage.
In all, the research by Bahia and his team suggests that, first, the impact of internet coverage is not only limited to wealthy households but also to poorer households. Second, the impact of better internet access on poverty reduction occurs mostly due to improvement in alternative employment opportunities, both in informal jobs (such as online retailing, social media management, web-content writing, etc.) and formal jobs (such as banking and computing).
In Nigeria, some of the major barriers to better internet coverage are the lack of adequate telecommunication infrastructure and the high cost of data. The government alongside six private companies have a $732 million (N264 billion) investment plan underway to solve some of the telecommunication infrastructure problems.
While the $732 million will not be enough to resolve all the key infrastructure problems, it is a necessary and vital step in the right direction, and should be supported with regulatory and risk-sharing measures. This will ensure that services are affordable for the poor majority, and go a long way in lifting many Nigerians out of poverty.
Still craving? Check out: WorldBank Policy Research Working Paper
Article Credit: Michael Adesanya