Price Information, Inter-Village Networks, and “Bargaining Spillovers”: Experimental Evidence from Ghana
“Price Information, Inter-Village Networks, and 'Bargaining Spillovers': Experimental Evidence from Ghana,” with Hildebrandt, N., Romagnoli, G., and Soldani, E., (2020).
Through a randomized experiment and detailed data on communications among farmers, we identify the impact of text-messages-based commodity price information on rural farmers’ revenues. The intervention affected prices received by farmers in two ways: (1) a long-lasting increase (9%) for treated farmers, and (2) substantial indirect benefits for certain control group farmers, which cannot be explained by classical informational spillovers. We discuss a novel mechanism of bargaining spillovers which can explain such positive externalities, even in the absence of information sharing between the treatment and control groups. Our results highlight the importance of accounting for longer-run spillovers and the potential of ICT interventions in emerging markets.