How Important is the Yellow Pages? Experimental Evidence from Tanzania

Abstract

Mobile phones reduce the cost of communicating with existing social contacts, but do not eliminate frictions in forming new relationships. We report the findings of a two-sided randomized control trial in central Tanzania, centered on the production and distribution of a "Yellow Pages" phone directory with contact information for local enterprises. Enterprises randomly assigned to be listed in the directory receive more

business calls, make greater use of mobile money, and are more likely to employ workers. There is evidence of positive spillovers, as both listed and unlisted enterprises in treatment villages experience significant increases in sales relative to a pure control group. Households randomly assigned to receive copies of the directory make greater use their phones for farming, are more likely to rent land and hire labor, have lower rates of crop failure, and sell crops for weakly higher prices. Willingness-to-pay to be listed in future directories is significantly higher for treated enterprises.

Keywords: agriculture, mobile phones, Search costs, Small and medium enterprises, Tanzania, telephone directories

JEL Classification: D83, M37, O13, Q13