Academic journal article Proceedings of the American Philosophical Society

Adam Smith, Economic Development, and the Global Spread of Cell Phones1

Academic journal article Proceedings of the American Philosophical Society

Adam Smith, Economic Development, and the Global Spread of Cell Phones1

Article excerpt

TODAY, 75 percent of people globally have access to a cell phone. Of the six billion subscriptions worldwide, 77 percent are held by people in developing countries.2 Despite the great disparities among high- and low-income regions globally, there is a rea- sonable parity in access to cell phones. Moreover, the ubiquitous prolif- eration of this modern technology in low-income countries has taken place quite rapidly, over the course of half a generation. Even when lacking basic needs-food, water, medicine, shelter, education-billions of people all over the world today rely on a technology that was re- served for the wealthiest sliver of the wealthiest nations a mere fifteen years ago. In contrast, for example, the governments in low-income countries have been trying to provide electricity for roughly sixty years, but 87 percent of their rural populations and 56 percent of their urban populations still lack access to it.3

We could analyze this rapid global proliferation in the relatively narrow terms of business and marketing or with a broader lens of tech- nology and society, but it might be most useful to approach it at a more fundamental level-that of political economy. Indeed, to take a more limited approach would not do justice to a phenomenon that has been so pervasive and rapid. In the field of economic development, the speed and impact of its spread render the mobile phone a clear outlier. But what if the cell phone phenomenon were not an exception but, rather, an illustration of fundamental principles? What if a study of this phenom- enon could serve as a guide to the best political-economic path forward?

Adam Smith sat down to write An Inquiry into the Nature and Causes of the Wealth of Nations about 250 years ago, long before the invention of the cell phone or even the landline telephone.4 But his work has provided the foundation for analyzing political economies ever since its publication in 1776. Smith had little to say about technol- ogy and innovation, but the relevance of his reading of human nature and how it affects social and economic processes has endured. In this article, I hope to show that Smith's observations on the general nature of human advancement and interactions go a long way toward explain- ing the extraordinary proliferation of cell phone technology, as well as bottom-up economic development more generally.

In particular, I hope to demonstrate that Smith articulated his in- sights and observations to promote broad-based economic empower- ment, through which other elements of progress ensue. The cell phone phenomenon, interesting in its own right, can exemplify Smith's mech- anisms of inclusive progress. But just as critically, we can move in an- other direction and look at cell phones to provide a re-reading of Smith, in significant part because his thoughts, though very relevant to low- income countries, are rarely used in "development economics." While the impact of cell phones has been large and pervasive, a re-understanding of Smith may carry even greater import.

I am focusing on the economic benefits of communication and why people adopt related technology. Therefore, I will leave aside any other direct political implications of mobile technology such as those revealed in the Arab Spring of 2011. I also leave unexamined, at least for now, other potential new influences of this technology in arenas such as banking and health services, which are potentially enormous but again are not the reasons why people originally adopted cell phones.

Adam Smith, "Development Economics," and "Aid"

As I endeavor to explain how cell phone usage spread in low-income countries through Smith's lens, it is hard to ignore Smith's relevance to these economies as a whole. Surprisingly, however, there has been little application of his thoughts in "development economics," although there are countless articles and books on his theories in general. This dearth is surprising because Smith's legacy in economics is very broad. …

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