Developing electronic markets in low-tech environments: India's agriculture markets

Research has identified the role of information technology (IT) in creating fair and efficient markets. Studies generally examine B2B and B2C market designs in settings where technology is already prevalent among market participants. Less well understood is IT's ability to enhance market efficiency when participants have minimal IT in their operations, and existing market processes are manual. In this setting, how does a price and market support system enable markets to operate better? In 2007, Thomson Reuters introduced a simple text (SMS) information service to agricultural market participants in India called Reuters Market Light (RML). We find that RML has made regional 'mandis' more efficient, and empowered farmers to sell crops more profitably. The implication for e-markets research is that a low-tech infrastructure can support a price information system and generate measurable benefits. Key factors underpinning RML's impact are standardization on low-end mobile phones and short customizable messages that raise market quality with low bandwidth.