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Cover ImageIFPRI Forum
March 2006



Panacea or Not, ICTs Can Play a Significant Role for the Rural Poor

The proliferation of information and communication technologies (ICTs), like cell phones and Internet access, has the potential to influence all aspects of development through their effects on governance, markets, media, and public services. Despite this great potential, however, the opportunities of the digital age are not equally accessible, and poor people have been left behind. This is not to say that poor constituents are passively forgoing ICTs, however. The demand-and at times the struggle-for access by poor people is accelerating in many countries.

A new book, Information and Communication Technologies for Development and Poverty Reduction: The Potential of Telecommunications, edited by Maximo Torero and Joachim von Braun and published by the Johns Hopkins University Press for IFPRI, addresses the implications of ICTs for poor people. In a collection of case studies, the book explores the relationship between ICTs and development in Bangladesh, China, India, Ghana, Laos, Peru, and East Africa.

The case studies show that reducing the information gap at lower cost is crucial for the poor. Despite restricted rural access, ICTs have an important positive impact on rural households. The welfare effect of rural telephone use is verified by rural users' perceptions of its benefits, the high demand for service, the substantial consumer surplus associated with telephone use, and rural households' willingness to pay for service. These positive effects can be expanded by increasing rural service access, adapting new technologies to rural settings, and using existing technologies-such as telephones-more innovatively.

Yet ICTs are not a panacea. For the potential benefits of ICTs to be realized in developing countries, many prerequisites need to be put in place: prompt deregulation; effective competition among service providers; free movement and adoption of technologies; targeted and competitive subsidies to reach areas and population groups that will not be served under market conditions; and institutional arrangements to increase the use of ICTs in providing public goods to poor people. Successfully harnessing the power of ICTs could make a substantial contribution to achieving the Millennium Development Goals (MDGs), both directly, through the delivery of public services, and indirectly, through the creation of new economic opportunities for the rural poor via better links to markets.

The book argues that although connectivity has been a priority and is the first step in advancing access to ICTs, it is also crucial to ensure that users have the capability to use the new tools and that relevant content is provided in accessible and useful forms. All three "Cs" must progress together.


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