Bridge Contracts in Africa: A Case Study of Orange Mali
Date
2023
Authors
Greenacre, Jonathan
Journal Title
Journal ISSN
Volume Title
Publisher
African Economic Research Consortium
Abstract
People incur transaction costs fitting their organizational arrangements into their
surrounding property rights system. This paper analyzes organizational adaption to
surroundings by examining which tool(s) from mechanism design people will use to
solve moral hazard problems. Broadly, the weaker people’s surrounding property
rights system, the more a principal will use tools from mechanism design, which
provides greater autonomy to the agent. The paper finds support for this hypothesis
by identifying ‘bridge contracts’, which Orange Mali uses to respond to weak property
rights between urban and frontier communities in Mali. The paper proposes to use
these findings to stimulate a ‘context specific’ approach to engineering economics.
This involves developing mechanisms to encourage people to work towards social
goals but also fit within specific communities. The paper applies this approach
to random control trials.
Description
Keywords
Mobile money, mobile money, agents, contracts, mechanism design, random control trials