The burden of size

I’m at the Lisbon airport, about to embark back to Madrid, where I’m living. During the last day of my trip around South America I had the opportunity to give an interview to one of the most important journalists of Uruguay, from the local newspaper El Pais. A person of great wisdom, with decades of experience interviewing people from all over the world.

It was truly a great pleasure to talk to him about Economic Sociology, Entrepreneurship and Emerging Economies. Together, we almost got to the conclusion that Uruguay could arguably not be considered an emerging economy, as we discussed about levels of corruption, bureaucracy and freedom to start a business in the country.

At certain point we caught ourselves wondering if violence and corruption in many places of Latin America weren’t easier to get hidden behind the crowds of the large and overpopulated cities. Murders and corrupt politicians (I put them in the same category on purpose) get protected by the anonymity within these large amounts of people, with illegal incidents flooding inefficient courts of justice incapable to solve problems before new ones arrive.

With little more than 3 million inhabitants, Uruguay has an upper class of about 300 thousand people. These people meet each other in theaters, movies and restaurants, knowing easily each other’s family members and actions.

Honor still has its value and people don’t want to see their names used in an inappropriate way. In Uruguay, it is still better to be a respectable medium or upper class citizen than a rich corrupt “ghost” that will have to avoid facing society and have his/her family and history marked.

I was thinking about corrupt and violent countries with small populations (there are plenty) to see if this naïve hypothesis would apply but it doesn’t. So the burden of size and the freedom to do wrong things in anonymity alone unfortunately does not explain these social problems. Religion doesn’t either. Education or lack of huge social inequalities perhaps?

What does religion have to do with Entrepreneurship?

Well, why is all of that religion discussion so important to me? Because you can’t understand most of the underdeveloped or developing economies of the world – and be able to dialogue with people living there – if you don’t consider under which social standards or value systems their logic are based on (I’m assuming you were raised in a western developed country).

What motivate their/our efforts? (I include myself here in the group of developing nations) What makes people to start profit-based or non-profit-based ventures there? If you simply rely on the fact that they/we are as capitalist as you, you will be incurring in a tremendous initial mistake. You won’t get their/our trust, and if you don’t get their/our trust you won’t make good business with them/us.

Here I show few superficial differences in starting ventures in emerging economies. Please, remember that these entrepreneurs were raised in the countries they started their ventures and therefore they were embedded in their local social systems. As an out-comer you would have to interpret their realities, something they did more naturally:

Do you believe in God? Part II: The unexplained does not justify blind faith.

Like anybody that enjoys thinking, I like to talk about polemic things like religion, football or politics. Especially because when there is no right or wrong, I can exercise my brain with fellow humans. Unfortunately we can’t talk to dolphins, whales or chimpanzees yet, to get their opinion about it. I’m sure someday we will be able to do so.

Always when I talk about this God issue, some people tell me that I’m dumb because there are many unexplained things around us, and therefore God exists. Well, I definitely believe that there are many unexplained things around us, but what’s the connection between those things and God? I don’t see it. Let’s take just a simple example: the “recent” case of Ram Bahadur Bamjan (the “Buddha Boy”, from Nepal). Discovery Channel could not explain how he can keep alive after being completely immovable for days:

Another constant question: Is it possible that spirits or souls exist? Definitely. Actually, I think that when a person or an animal dies, part of their energies stays present around us and even talk to us or influence us. Can that be called soul? Yes, why not? Spiritism, Voodoo, Yoruba or Candomble are really amazing and powerful things and I do think that they are based on natural phenomena that can be perceived by many of us in different ways but still can’t be explained.

“I’ve got you!” many believers then tell me, “so, you believe in God!”. What the heck! Does that justify the existence of God? Of course not. If God(s) exist(s) just because we can’t explain something, then we are screwed: there is no reason then to look for new discoveries whatsoever. Penicillin? What for? Lets all gonna die at the age of 35 due to a group of stupid bacteria just to make our God(s) (and priests) happier!

Emerging markets, emerging economies, emerging what?

I just wanted to explain, briefly, why I prefer using the term “entrepreneurship in emerging markets” rather than “entrepreneurship in emerging countries” or something like that in this blog.

More than a morphological distress, I think the question I raise here is quite valid. In English, an emerging market may also denote the emergence of a new sector, a new industry where a lot of people start to invest money, time and effort to explore, including some entrepreneurs themselves. Seen from this perspective, an emerging market is usually described as located in a developed country or, at least, in a region with a lot of existent markets where sometimes, due to the presence of an improved technology o new way of doing things, a new market emerges (again, usually we have seen this use of the expression in developed countries).

The geographic reference is another problem pending solution. Should we call an emerging market as an emerging country or emerging region? Confusing isn’t it? I don’t believe the world can still be separated in developed, developing or underdeveloped anymore, neither in dated classification such as first world or third world. With the increasing mobility of things, ideas and people, you may find a very developed product or service being produced in a very underdeveloped place and vice-versa. In the other hand, you may find plenty of developed regions coexisting with quite underdeveloped ones in the same country and often even in the very same city. I believe these differences are going to increase around the world as the distance among those who can use technology to access and produce knowledge from those who can’t look to increase everywhere. People, instead of places, doesn’t matter where they are, will become global hubs of technology, design and exchange in a medium term. So how can we say that India is a developing country if you find in the very same country some of the poorest people on Earth living just beside some of the most influential, intelligent or richest? Many economists and sociologists are trying to solve this thing called socioeconomic development for centuries and I won’t even dare to discuss such a big thing in the little post of a blog.

So, if I used emerging economy, emerging country or emerging region, I would be putting together something I don’t think it should be put together (different levels of development in a single generic one). In that sense, the term emerging market can cover not only the first mentioned meaning but also the extended meaning I believe the most appropriate for the term: referring to any place, in any large or small, rich or poor region of the world where new markets emerge. The problem then falls over the definition of what is a market but this another complex enough issue to another post.

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