Adoption and Impacts of Digital Payment Technologies: Evidence from Informal Transit

Digital technologies have spread rapidly in much of the world. Despite their expected impacts on productivity and growth, rates of adoption remain modest among firms in sub-Saharan Africa. This research will investigate the role of information asymmetry within firms in explaining businesses’ resistance to technology adoption. By mitigating moral hazard, digital technologies enable changes in the contracting space between employers and employees, in ways that may constitute a barrier to their adoption. To study this potential issue, I will conduct a randomized experiment by introducing digital payment technologies into widespread small businesses, taxis, in Senegal. In collaboration with a large mobile money company, Wave, I will test three options for digitizing payments and evaluate the impact of digital payment technologies in the informal transit sector.