Demand for Urban Exploration: Evidence from Nairobi, Kenya

Pauline Wanjeri

2

SECTOR

African Evidence Summit

PROJECT TYPE

Research

Location

Kenya

BEHAVIORAL THEME

Economic Growth | Exploration | Urbanization
OVERVIEW

The rapid urbanization of low and middle-income countries was expected to boost growth, but unplanned growth made cities difficult to navigate, increasing the financial and mental costs of exploration. To understand the impact of personal experience with urban locations on travel and work costs, and to identify key barriers to exploration, we conducted a randomized controlled trial (RCT).

Our study involved 799 casual workers from Kibera, Kawangware, and Viwandani in Nairobi. We created real-stakes work opportunities and randomly introduced familiarity with different urban locations through job training sessions. Participants collected air quality data in locations within 10 km of their home neighborhoods, either in familiar or unfamiliar areas. We measured their willingness to work in these locations using conjoint choice elicitation and assessed their return to previously unfamiliar neighborhoods one month later.

THEMATIC AREAS

The study aimed to estimate exploration friction in urban environments, understand its mechanisms, and evaluate its impact on economic outcomes. We found that one-time exploration eliminates wage premiums and belief differences, and universal familiarity increases commuter market access by the equivalent of a 17% decrease in all distances in Nairobi. Additionally, participants partially anticipated one-time costs and the reduced salience of unfamiliar areas.