The World is Lumpy

I just read a thought-provoking article in Foreign Policy magazine by Pankaj Ghemawat www.ghemawat.org, a Harvard Business School professor on why the world isn't flat. The article was sent to me by Kirk Owen CEO of www.merscom.com, an online casual games developer with a global footprint. Ghemawat talks about the "10 Percent Presumption"--that by most indicators, on average, globalization is closer to 10%. One of the indicators he points to is long-term human migration which stood at 3% of global population in 1900 and was 2.9% in 2005. His point is that not only is the entire world not flat, but even where it is flat, it can easily develop a bump. For example with democracy there appears to be a groundswell movement back to socialism in South America. In fact for most of us in the U.S. we are constantly perplexed by citizen choices for governments that are detrimental to their well being, eg Hamas in Palestine. Yes the world is lumpy.

AT Kearney recently published their Globalization Index that ranks countries by how global they are: http://www.atkearney.com/shared_res/pdf/Globalization-Index_FP_Nov-Dec-06_S.pdf. Singapore (a city rather than a country!) ranks first. The U.S. ranks third, China 51st and India 61st. The only category that India is ranked high on is remittances! China on the other hand gets high marks for economic and FDI categories. All three U.S., India and China get low marks for the "personal" category, which makes sense since these are large countries the majority of whose populations do not travel abroad.

Having run one, I have personally experienced the rise of the "micro-multinational" companies. These are startup companies that an early stage company go global--for customers and/or talent. In some sectors early adopter customers are no longer in the U.S. or Europe, for example telecommunications where most of the innovative service providers are in emerging markets led by India and China.

Yes globalization is happening, then again it was happening in the 1400s when European powers spread and began becoming colonial powers. Even then the world was not flat but lumpy. The British ran India differently than they ran Kenya to accomodate local norms and conditions. Economic opportunities in macro terms tend to be the same around the world, people want food, shelter, clothing, education for their children, etc.. However there are local variations because of tastes, climate, culture and so on. Most importantly humans clearly like to be in geographically local communities. Growth on the Internet has been faster within countries than between them. Less than 10% of phone calls are non-domestic.

To get a global perspective in technology and life sciences attend www.tieconeast.com titled "The New World Keiretsu". There will be speakers like Ram Sriram who was an angel investor in Google and sits on the Google board, Governor Deval Patrick, and Dean Kamen the prolific inventor. This is the best conference in Boston to network with entrepreneurs, businessmen, financiers from around the world to get a perspective on our lumpy world.

Comments

[xabg jcgms]

pyqlvkmtz owxblgd zpoedav wdyg dbzu eufsd zymifq