Critics of Thaksin’s “populist” policies often condemned the wasteful expenditure of village credit on consumer goods such as mobile phones. I always found this a strange criticism, given that those making it probably couldn’t last a day without their own mobiles. But it does reflect the anachronistic view many commentators have about the nature of rural economy and society. Just how anachronistic was underlined in a recent brief article in The Economist:
The idea that mobile phones bring economic benefits is now widely accepted. In places with bad roads, few trains and parlous land lines, they substitute for travel, allow price data to be distributed more quickly and easily, enable traders to reach wider markets and generally ease the business of doing business. Leonard Waverman of the London Business School has estimated that an extra ten mobile phones per 100 people in a typical developing country leads to an extra half a percentage point of growth in GDP per person.
The fantasies of sufficiency economy notwithstanding, Thailand’s rural economy is no longer based on rice fields, fish ponds and orchards. Rural livelihoods are now linked in diverse ways with diverse markets. Mobile phones make very good sense.
15 responses so far ↓
1 Sidh S. // Nov 30, 2007 at 6:26 pm
I totally agree that mobile phones make very good sense and if PMThaksin’s village fund really had those objectives in mind, then it is highly commendable. Unfortunately not, as it is actually not that much different to PMThaksin’s government extending loans to Myanmar under the condition that they use the services of ShinCorp. Sure, better telecommunications connectivity will benefit the Burmese people at large – and even the Burmese opposition – but it does not make PMThaksin a hero (besides, it also greatly benefitted the Burmese Junta). We must not confuse the two. In the case of the village fund, carefully administered micro-credit schemes may be a better alternative (my two cents on economic issues).
2 Colonel Jeru // Nov 30, 2007 at 10:40 pm
o.k. Andrew I will have to agree with you on this point. It may give you some satisfaction to know that a few months ago I did not believe so.
But any new-fangled technology is only as good or as useful depending on how the user employs it. A cellphone should be very helpful to the farmer to get his daily market information … and negotiate all the “deals” he needs to get his farm competitive. But does the Thai farmer realize that?
3 Viroj NaRanong // Dec 1, 2007 at 6:58 am
Even when one does not consider those “economic benefits” and focus only on access to telephone as a communication device which–at times–can be vital for everybody, and want to find the most cost-effective to provide it; one would find that, in rural (especially remote) areas, mobile phone would be the most efficient solution, much more than having the long telephone lines going to over the vast and low population density areas.
4 Teth // Dec 1, 2007 at 11:05 am
But any new-fangled technology is only as good or as useful depending on how the user employs it. A cellphone should be very helpful to the farmer to get his daily market information … and negotiate all the “deals” he needs to get his farm competitive. But does the Thai farmer realize that?
Once again, the one who demeans the Thai farmer.
As Mr Viroj said, even as a communication device, it is extremely more beneficial and cost-effective than land lines.
Surely you must know that Thai people can communicate, even those rural, ignorant farmers who don’t know their place in Thailand’s “democracy.”
5 nganadeeleg // Dec 1, 2007 at 2:45 pm
“The idea that mobile phones bring economic benefits is now widely accepted”
I accept that mobiles phones are often more cost effective than land lines, and it’s obvious that they can bring economic benefits, especially to those who sell them (Thaksin is a perfect example), but for many users, mobile phone have a negative impact on their economic wealth.
Personally, I don’t have a mobile phone, but unfortunately I have to pay the bills of my family members who do have them.
Andrew, I would be interested to hear of any research information you have as to how the mobile phones have been utilized by Thai villagers.
(Are they seen primarily as a business tool, or as a modern toy ?)
6 Srithanonchai // Dec 1, 2007 at 3:03 pm
It is rather bizarre to discuss whether mobile phones should be permitted to be used only by certain groups in society. This is very patronizing. It is also futile, because in an open economy socio-economic decisions are decentralized to the individuals–as long as they possess the means of exchange, that is.
7 nganadeeleg // Dec 1, 2007 at 6:08 pm
Srithanonchai: Who is discussing whether mobile phones are permitted to be used only by certain groups in society?
Some critics of Thaksin’s policies have suggested that expending village funds on consumer goods such as mobile phones is wasteful (by either the then government, or by the recipient of the funds).
Andrew, a fan of Thaksin, has countered by by suggesting expenditure on mobiles phones makes good sense.
As usual, I’m in the middle, by pointing out that how the phones are used would determine whether the expenditure is wasteful or not.
You might think it patronizing and futile, but try telling that to the many financial counsellors trying to help debt ridden consumers.
8 Colonel Jeru // Dec 1, 2007 at 6:11 pm
But Teth those farmers do know their place in Thai democracy and last I heard the cellphones were very useful to these very farmers to get over their ignorance on what democracy . . . err a vote this year, should be worth at. I have a feeling that at the North . . . where the price of a vote had jumped to Baht 2,000 (versus Baht 400 last yar) must have been helped by rapid information dissemination . . . via the cellphone.
Cellphones with games, internet plus camera to boot must be very useful to raise a small Thai farmer’s productivity. Because the farmer had to borrow to buy the latest cellphone gadgetry . . . those productivity increases . . . via gameplaying or picture taking . . . become more urgent. What do you think Teth those Thai farmers would be using cellphone internet features for?
9 Srithanonchai // Dec 1, 2007 at 6:32 pm
“Are they seen primarily as a business tool, or as a modern toy?” >> Or as a modern means of communication? SMS decisively helps me keeping up my relationship with a person close to my heart. Is this a valid reason, or does it mean that I use the mobile as a “modern toy”? Should the state determine who has the right to buy a mobile phone, based on a law that stipulates valid reasons for having one? If the “necessity” criterion would be employed, the entire mobile phone market would collapse in a few days–the standard usage being something like “Khun Mae, I am at BTS Mor Chit already. Will be home in twenty minutes.” Same goes for computers and the Internet, including blogs (excluding New Mandala, of course). Since we are at it, there is also no necessity for the great number of nonsensical glossy journals, senseless Japanese cartoon books, and neither for 90 percent of the TV program.
nganadeeleg: I sympathize with your “pay only” situation.
10 Teth // Dec 2, 2007 at 12:57 am
“What do you think Teth those Thai farmers would be using cellphone internet features for?”
For the same thing you do.
Or are they too stupid and dirt poor?
11 Srithanonchai // Dec 2, 2007 at 1:48 am
“but try telling that to the many financial counsellors trying to help debt ridden consumers.” >> A functionally differentiated economy with a consumerist approach (and, regarding Thailand, a strong emphasis on social status as expressed in consumer goods)–often supported by the state, called “internal demand”, in order to add GDP to export-generated income–has its risks, no doubt about this. In Germany, about 10 percent of the population have more debts than they can repay. Many years ago, when I was still a social worker, I almost ended up as a financial counsellor for the German armed forces.
12 Teth // Dec 2, 2007 at 7:35 am
Or are you simply that unimaginative and dull?
13 Colonel Jeru // Dec 2, 2007 at 12:23 pm
Teth . . . my cellphone has no camera nor internet features. I am that unimaginative and that dull.
My cellphone and my car in exchange for the rustic life . . . sincerely!
14 Teth // Dec 2, 2007 at 10:05 pm
As I expected.
15 Wendell // Dec 3, 2007 at 3:29 pm
It is certainly correct to point out that under an open economy system, people are free to spend their money as they see fit–regardless of what observers may think is useless or wasteful.
However, when the money being spent comes from a financial institution (bank or village fund committee) in the form of a loan that the borrower is expected to repay, then it is not unreasonable to question whether the money is used in a way that will produce some financial benefit. I know that if I were to go to a bank seeking a loan, the bank would certainly be interested.
Unfortunately, so far as I am aware, there has been only limited work done on examining what village fund recipients purchased with their loans, never mind to what use those purchases were put. Without that information, it’s hard to draw any reliable conclusions. Nevertheless, it would be a legitimate area of inquiry.
For people who are interested in statistics and regression analysis:
Looking at the paper to which the Economist article refers (Waverman et. al., The Impact of Telecoms on Growth in Developing Countries at http://web.si.umich.edu/tprc/papers/2005/450/L%20Waverman-%20Telecoms%20Growth%20in%20Dev.%20Countries.pdf), it appears that Thailand is one of the countries upon which the conclusions are based. Unfortunately, the version above does not single out results of particular countries, so we don’t know how strongly mobile phone penetration has affected economic growth in Thailand.
Leave a Comment
Please note: New Mandala encourages vigorous debate. However, for the moment we will only be publishing high-quality comments that make original contributions to discussion. There will, of course, still be space for pithy, humorous, eccentric and cheeky input. Short and sweet will usually trump long and involved. Repetitive ranting, unimaginative point-scoring and idle abuse will not be entertained. Comments which carry a real name are also more likely to be approved. Thank you for your ongoing interest and contributions.