Economy, World

Catalyst Conversation: Microfinance in the Developing World29 Dec

imagesmuhammad-yumus-small

Muhammad Yunus helped pioneer the concept of microcredit with the formation of Grameen Bank – meaning “village bank” – in Bangladesh in 1983. The bank is based on the principle of that loaning what would be considered tiny amounts of capital to entreprenuers – the first loan was $27 to a total of 42 craftpersons – could not only lift people out of poverty but also serve as a sound investment practice. Today, Grameen Bank has 8 million borrowers, a 99% loan repayment rate and loaned $7b billion since its formation.

During this roundtable discussion, GCG seeks to learn what the future hold for the broader state of microfinance, opportunities and challenges, and debates how well has the concept of microfinance been successfully exported from Grameen Bank & Bangladesh. GCG also discussed if the model may work in some societies/developing countries better than others. The conversation also included internet institutions such Kiva and Prosper allowed for greater adoption and/or efficiencies of micro-finance.

Please login for supporting material and the full conversation.

Economy

Continuing the Conversation: Where Do Clusters Come From?23 Dec

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Where Do Clusters Come From?

Economic clustering, or the theory that industries or segments of industries agglomerate around certain locations, is as novel an idea as it is ambiguous. In particular, the empirical evidence supporting clustering lacks in universal applicability, as scholars and businessmen attempt to explain the genesis of many regions in parochial terms incapable of replication–such as the birth of Hollywood or Wall Street. But is clustering, and in general economic development, more than just the random, unpredictable rise and fall of cities and communities? Or does a complete theory of clustering involve common variables that may be targeted across regions, regardless of economic status or other constraints?

Brett Staron leads GCG in an exploration of where clusters come from in this Catalyst Conversation.

The roundtable discussion identified what has been the traditional role of government in economic development and how does this paradigm shift with the clustering approach and where did Wall Street, Hollywood, or Silicon Valley come from. GCG also discussed if clusters more amenable to new industry versus existing industry.

Other guiding questions included:

  • What have been some of the common academic or educational variables leading to clusters around the world?
  • Why do smart people move to “smart” cities?
  • What would a workable model of economic development achieved through clustering driven external preconditions (land, location, climate, etc) look like?
  • What is the role of entrepreneurs in catalyzing clustering?

Please login for the supporting material and the full conversation.

Economy

The State of the Global Economy: Cheap Credit and the Housing Market09 Aug

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The State of the Global Economy: Cheap Credit and the Housing Market
Prepared by: Stephen McMullin and Srujan Linga

The Global Catalyst Group examines the relationship between cheap credit and the housing market. Further, GCG discusses the implications of a post-cheap credit society in the United States.

Questions include:

  • How important is the health of the housing market?
  • How important is the velocity of money (The ability for easy lending/spending)?
  • What will the changes in the economic landscape do to the political landscape?

The following materials were discussed to support our conversation:

The 2009 Outlook: Nouriel Roubini (NY Stern School of Business)

http://www.youtube.com/watch?v=51SxmcaKJIw

Libertarians: A third party? *Please excuse the political undertones (feel free to skip the last 1min and 30 seconds)

http://www.youtube.com/watch?v=k1PoDidwUEA

Economy

The State of the Global Economy: A look into the American Recovery and Reinvestment Plan09 Aug

recovery

The State of the Economy: A look into the American Recovery and Reinvestment Plan

Prepared by: Alex Johnston and Donald Ball

Obama’s new stimulus plan holds great promise to reinvigorate the economy, but at what cost? The Global Catalyst Group dissects some of the proposed funding measures in his plan. Two main questions are answered:

  • Which funding proposals are most likely create the greatest return for the American people and why?
  • Which funding proposals are most likely create more problems than they solve and more importantly, how could they be improved?

(more…)

Economy

The State of the Global Economy: Historical Lessons Learned from 1907, 1929, 1987 and 200109 Aug

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Historical Lessons Learned from 1907, 1929, 1987 and 2001
Prepared by: Ryan Coleman and Kevin Walsh

Guest: Peter Anderson

GCG explores the causes of the Panic of 1907, Crash of 1929 and the Bubble of 2001 to uncovered key lessons learned. Based on historical knowledge and precedence, GCG explored the various opportunities that were capitalized on after each “Bust” and attempts to identify and determine the major opportunities that exist after the 2008 Credit Crash.

Key questions include:

  • What major themes are present throughout the the four different periods?
  • What were the key triggers of each of the events?
  • What opportunities were taken advantage of and profited from after the bust?
  • Looking forward what major opportunities exist after the events of 2008?

(more…)

Economy, Education, Tech

Educational Development in Developing Countries09 Aug

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Can introducing a laptop to every child foster educational as well as economic growth in developing nations?

Prepared by Marcus Howard and Srujan Linga

There is no doubt that there is a large education gap between the established and developing nations of the world. One Laptop Per Child (OLPC) attempts to begin closing this gap by introducing technology to students in rural nations through the implementation of a $100 laptop to every student. Started by Nicholas Negroponte, director of the Media Laboratory at MIT, their mission is to empower the child of developing countries to learn by providing one connected laptop to every school-age child. Started in 2005, OLPC has provided just over 500,000 laptops to children in Africa, Asia, and parts of Europe.

While ambitious in their mission; their initiative has not been without setbacks. OLPC has been fraught with several financial, political, and structural pitfalls. First, widely marketed $100 price point for the laptop costs them just under $190 to produce. Second, while the technology may be present in many of the OLPC classrooms, there are few teachers trained sufficiently enough to utilize the technologies and/or to help students troubleshoot. Third, many object that OLPC’s approach to education does not take into account the varying cultural and political norms and attempts a “one size fits all” approach to education and technology. Finally, OLPC is facing an increase in competition by companies like Intel due to demands by consumers in developed nations for a cheaper laptop.

Education is quickly growing to be a priority not only in developing nations but in the United States as well. Given the vast availability of free technology that spans every area of education, providing a free laptop to children in developing countries can potentially provide great value to everyone involved. Is OLPC a viable solution to this very pertinent problem?

Video 1: http://www.youtube.com/watch?v=cM77C2ejTw&feature=player_embedded

Video 2: http://www.youtube.com/watch?v=qMeX2D4AOjM&feature=player_embedded

Finding a solution:

Education in developing countries should be a priority. While OLPC has served as an ambitious foundation to tackling the problem there is still more work to be done.

During our conversation, the Global Catalyst Group discussed:

  • How can we further utilize open source software and technology to enrich the educational experience of students in developing countries?
  • What are some ideas to combat the “One size fits all” approach that serves as one of the major objections to the OLPC model?
  • Is there real “value added” in providing laptops to children in developing nations when the teachers haven’t the training or educational experience to masterfully navigate through the technology?
  • Is technology truly the answer to the growing educational gap between developing and established nations?

Below are some additional resources to help with learning about the project, it’s progress, and some of its setbacks.

The OLPC website:

http://laptop.org/en/

Keynote by Nicholas Negroponte on OLPC

http://www.netevents.tv/video/nicholas-negroponte-presents-olpcs-100-dollar-laptop

Economy

The Long Tail vs. The Parodox of Choice09 Aug

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Meeting #7: The Long Tail Theory vs. The Choice Paradox

This weeks topic will discuss two conflicting theories and the business models supported by each theory. As a group, we will evaluate the Long Tail Theory and The Choice Paradox. Both theories offer great insight into different business models and produce different approaches toward business.

Long Tail Theory:
Original article: http://www.wired.com/wired/archive/12.10/tail_pr.html

Good old wikipedia offers a summary:

The Long Tail Theory developed Chris Anderson describes the niche strategy of businesses, such as Amazon or NetFlix, that sell a large number of unique items, each in relatively small quantities.

The distribution and inventory costs of these businesses allow them to realize significant profit out of selling small volumes of hard-to-find items to many customers, instead of only selling large volumes of a reduced number of popular items. The group comprising a large number of “non-hit” items is the demographic called the Long Tail.

Given a large enough availability of choice, a large population of customers, and negligible stocking and distribution costs, the
selection and buying pattern of the population results in a power law distribution curve. This suggests that a market with a high freedom of choice will create a certain degree of inequality by favoring the upper 20% of the items (“hits” or “head”) against the other 80% (“non-hits” or “long tail”).

The Long Tail concept has found a broad ground for application, research and experimentation. It is a common term in the online business and mass media, but also of importance in micro-finance, user-driven innovation, social network mechanisms, economic models, and marketing.

The Choice Paradox:
TED Video on the premise of the Choice Paradox:

http://www.ted.com/index.php/talks/barry_schwartz_on_the_paradox_of_choice.html

White Paper attached:

http://drop.io/meetingchoice

The Paradox of Choice – Why More Is Less is a 2004 book by Barry Schwartz. In the book, Schwartz argues that eliminating consumerschoices can greatly reduce anxiety for shoppers. Reccomended by Kevin Pereira.

Autonomy and Freedom of choice are critical to our well being, and choice is critical to freedom and autonomy. Nonetheless, though modern Americans have more choice than any group of people ever has before, and thus, presumably, more freedom and autonomy, we don’t seem to be benefiting from it psychologically.

In summary, observed in many cases is the paradox that more choices may lead to a poorer decision or a failure to make a decision at all. It is sometimes theorized to be caused by analysis paralysis,  real or perceived, or perhaps from rational ignorance.

Guiding Questions
1. Thoughts on relevance and pervasiveness of both Chris Anderson’s Long Tail and Barry Schwartz’s Paradox of Choice theories. Find an interesting application / case study to  up with a application / case study for each.
2. Do you believe that there is a inherent tension between the Long Tail theory of niche-driven demand and the less is more concept of the Paradox of Choice’s? If this tension is present – is it resolvable, and how might you understand it?
3. How might the idea of crowd-sourcing and mass customization fit within these two frameworks?

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The Global Catalyst Group seeks to gather persons of unique potential into a community dedicated to thought leadership, shared resources, and mutual improvement. Through deliberate collaboration, collective mentorship and continuous dialogue we believe that we can support and stretch one another with meaningful insight and thoughtful guidance. We encourage our membership and partners to exercise, together, their ambition, creativity, and both their professional and social networks to pursue a greater purpose than oneself. We challenge them to leave a legacy and we support one another towards this end.

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