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Impact of Mobile Phone-Based Money Transfer Services in Agriculture: Evidence from Kenya

Author

Listed:
  • Kirui, Oliver K.
  • Okello, Julius J.
  • Nyikal, Rose A.
  • Njiraini, Georgina W.

Abstract

This study contributes to pioneering literature on the impact of mobile phone-based money transfer, especially in agriculture. It provides information regarding financial intermediation to the excluded through the use of new generation Information Communication Technology (ICT) tools, especially the mobile phone. The study employs propensity score matching technique to examine the impact of MMT services on household agricultural input use, agricultural commercialization and farm incomes among farm households in Kenya. It uses cross-sectional data collected from 379 multi-stage randomly selected households in three provinces of Kenya. The study found that use of mobile phone-based money transfer services significantly increased level of annual household input use by $42, household agricultural commercialization by 37% and household annual income by $224. We conclude that mobile phone-based money transfer services in rural areas help to resolve a market failure that farmers face; access to financial services. We discuss implications for policy and practice.

Suggested Citation

  • Kirui, Oliver K. & Okello, Julius J. & Nyikal, Rose A. & Njiraini, Georgina W., 2013. "Impact of Mobile Phone-Based Money Transfer Services in Agriculture: Evidence from Kenya," Quarterly Journal of International Agriculture, Humboldt-Universitaat zu Berlin, vol. 52(2), pages 1-22, May.
    • Handle: RePEc:ags:qjiage:173644
    DOI: 10.22004/ag.econ.173644
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    More about this item

    Keywords

    Agribusiness; Agricultural and Food Policy; Crop Production/Industries; Food Security and Poverty; Marketing; Research and Development/Tech Change/Emerging Technologies;
    All these keywords.

    JEL classification:

    • Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development
    • Q16 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - R&D; Agricultural Technology; Biofuels; Agricultural Extension Services
    • O30 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - General
    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy

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