Social Media Use in the Developing World

The social media explosion that has sucked in the lives of a large population of the developed world, has also recently been rapidly spreading throughout the developing world. A study done by Pew Research Center’s Global Attitudes Project from March 21-May 15, 2011 shows that use of social media is growing much more rapidly in the developing world than it is currently in the developed world. People in low income nations (in areas that have access to internet) use social media sites at rates as high or even higher than people in high income nations. For example, according to the study, Russia and Indonesia had the highest rates of social media users amongst their internet users with a rate of 86 percent. This is much different from the US in which less than 60 percent of internet users use social networking sites.

This is an extraordinary phenomenon as social media has the power to do many amazing things. Social media outlets such as Facebook or Twitter enable the rapid spread of events and ideas throughout the entire world. The world is becoming much smaller as people from every corner are able to share with each other their ideas as well as their cultures. This spread of ideas has the capacity to greatly improve the livelihoods of populations throughout the developing world. People can use social media outlets to share their own ideas and form a common ground to improve situations. More recently, during the Arab Spring, people have been turning to social media to communicate with each other and start revolutions to improve their lives. The Pew Research Center’s study even showed that in events of political unrest, social media usage greatly increases. Both Russia and Egypt, countries which both have experienced recent political movements, saw an increase of ten percent in social media usage. This portrays the fact that people in the developing world are actually using social media outlets in times of strife as a way to collaborate efforts with others.

The results of this study have shown that usage of social media is truly growing exponentially throughout the developing world. This growing usage has the ability to enable populations throughout the world to communicate with each other and share their ideas at very fast paces in order to improve their livelihoods, especially during times of conflict. This usage is only going to increase as mobile usage, especially that of smart-phones, and internet become even more accessible to people throughout the developing world within the near future.

Pew Research Center Report 

E-brokerages Tap Social Media for Faster Service

Social media is beginning to not only impact people in a leisurely aspect but is affecting operations of some of the largest businesses that exist.  Tom LaScola sent out a Tweet to his 5,000 followers about the problems he encountered regarding setting up a new TD Ameritrade account.  Minutes later to his surprise, the company (who wasn’t one of his followers) tweeted LaScola with an apology and direct number to contact about resolving his problems.

Other financial companies are also monitoring social media outlets for mentions of their business in order to improve customer service, sales and any other department that is being mentioned in customer Tweets.  A few of these companies include: TD Ameritrade, E*Trade, and Schwab.

I think that this use of social media is beneficial in many ways.  Not only does it help companies get feedback and improve, but it creates a new sector in the corporate world.  There are now new positions for people who have specialized social media skills.  Lastly, the most important development aspect of social media is that is allows for quicker and better communication on a global scale.

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KONY 2012: Part II Video Released Today

In an interesting coincidence of timing, after yesterday’s class discussing social media and the KONY 2012 campaign, this morning Invisible Children released their follow up video, despite what was reported yesterday. It seems designed to address some of the concerns that have been raised following their first viral video and to keep their momentum going. I’m interested to see what you all think about this one, after our conversations yesterday with @debelzie and @jssozi.

Micro-Bias: New Study reveals Implicit Bias in Kiva Loans

Micro lending websites, such as Kiva.org, are a newly emerging tool that allow people to send money to people in developing countries. Kiva’s purpose has been summarized in an earlier blog post. However, the problem of potential bias has not yet been addressed in this blog.

According to an analysis released by researchers at Nanyang Technological University in Singapore, lenders on Kiva tend to favor attractive, light-skinned females. This is made possible by the profiles created on the site, which feature a picture of the person who is asking for aid. Internet users are able to browse through profiles on the website and search based on country or type of project. The researchers in the study found that in order to get money more quickly, “it is better to be pretty than ugly, female than male, skinny than fat, and, yes, light skinned-than dark-skinned.” The study used a skin color scale taken from research on bias against new immigrants. Conclusive evidence was found that light-skinned borrowers received money faster, and being attractive didn’t hurt.

Walter Theseira, Assistant Professor at Nanyang Technological University, Singapore

Walter Theseira, the lead author of the study, comments:

“This is why [NGOs] spend so much time choosing just the right photographs to illicit donations… why people do that… it’s a bit hard to say. Our hypothesis is that this is probably more a form of implicit discrimination than people acting on explicit bias.”

Interestingly, being from Africa helps when receiving loans. Loans to Kenya fund much faster than loans to Bulgaria. This geographic discrimination has been found to be much more influential than skin tone because many users believe that there is more need in poorer countries, which fits Africa’s stereotype. Some lenders also believe that their dollars will go farther in Africa than in other countries.

Researchers worry that “baked-in-bias in peer-to-peer choices could undermine the very idea of a financial solution to unfairness.” This bias is seen in other studies. For example, subconscious bias appears in a Stanford study that found that online shoppers were less trusting of an ipod for sale if the hand in the picture was black. Another study from Wharton found that black borrowers on Prosper.com were up to 35% less likely to get a loan at a similar interest rate when compared to white borrowers. Prosper responded to this by eliminating user photos.

Prosper.com Review from P2P Lending News

One of the interesting elements of Kiva is the personal feel to it. By looking at a picture of a person in a different country, you get a sense of personal connection. You almost feel like you know them, that you could shake their hand after providing aid. Eliminating profile pictures may be a way to combat implicit bias, but it will eliminate this personal aspect of Kiva. This may hurt participation rates as people in developing countries search for new visual stimulation.

An important implication of this study is that online crowdfunding, microfinance, and lending websites need academic examination. The big question now is what the sites can do to fix the problem. Theseira suggests that the solution lies in regular Kiva users:

“What we found [on Kiva] are these patterns of discrimination are most evident in people who don’t lend much…In the case of the Kiva website itself, I think if we can try to establish more clearly whether it’s implicit discrimination or something else, it might be possible to use technology to address it.”

Theseira believes that those who habitually use Kiva are more strategic, businesslike, and less biased. These repeat users are interested in details that are relevant to loan-worthiness rather than irrelevant details such as attractiveness. His suggestion is to present a set of profile designed for newer users to counteract measured biases. Theseira also suggests that offering fewer choices or designign elements of the site to slow the decision-making process could help with users who feel overwhelmed by choices.

Theseira, like many academics in the field, is hungry for more information about why people prefer to fund light skinned, attractive people. Current research is at the tip of the iceberg. Theseira has expanded his research to myc4.com, a European lending site where investors earn interest. This will help to better understand the incentives behind the decisions made when lending.

“You can lend directly to a small business in Africa”

Kiva’s leaders have been “admirably open” about the problem of biases and are eager to innovate ways to avoid micro-discrimination in regards to geography, industry, and male-female bias. With new information and published studies, hopefully these biases can be buried.