Physics of Poverty
This is a series for YourStory.in, India’s leading comprehensive online platform for entrepreneurs, dedicated to promoting the startup ecosystem.
There is a certain romanticism that we all carry about rural living. For many of us it represents the simple life, a place where you go when you need to slow down and not do much. And it is precisely that. The world’s relentless march forward occurs in the cities. Almost three quarters of the world’s productive output, its GDP, comes from its cities. There are simple reasons for this. When we cluster closer together into large agglomerations it brings us close to resources and information. City living is more expensive because we are willing to pay more for the choice and opportunity that this results in. For the entrepreneur, it allows you to access the resources you need quickly and efficiently from legal to administrative to people and gives you rapid access to a larger market. For the job … Read More »
Many CEOs and HR folk will tell you that happy people make for more productive employees. In fact there are even studies that demonstrate that when you are happy you are more productive. Therefore, the reasoning goes, it is important for companies to make employees happy so that they will be productive. Some even go so far as to say employees first, customers second. An article in the recent issue of Outlook on happiness made me wonder if they haven’t got it all backwards.
The article reported on a survey of happiness among some 2000 people across India. In it they asked people questions about whether they were happy, what made them happy, and who they thought were the happiest people. What made people happiest was optimism about the future, followed by feeling fit and work success. Also, a sense of … Read More »
Take a risk. Use your imagination. Transform your world.
Try to say this in any Indian language. I challenge you. You will fall short. Short on comparable, easily accessible vocabulary, short on that easy feel of flow and short on memories of when you last heard something like it said. English is the language of progress and possibility. English is the language of technology. English is the language of change.
To be progressive, therefore, one of the most powerful things we can do in this country is make English mandatory curriculum in every school, and then in the next generation just switch to English as the sole medium of instruction. One world. One language.
OK, I hear the critics. Some of our languages are so beautiful. So much of our culture will be lost. Then quick, start translating. English is one of the … Read More »
In my last post, I mused about who actually knows what something is worth? Beyond survival, ‘value’ is simply collective perception, a construct of our collective mind. So what do we mean when we talk of ‘value’? What is our mind ‘valuing’ and for what purpose? For an entrepreneur this is a fundamentally important question. On a very simple level you could claim to be creating value so long as someone sees it as valuable enough to pay money for it. However, there are people willing to pay money for all sorts of destructive things like drugs and cigarettes and exorbitant amounts of money for completely worthless things like crystal swans. Of course that is my value judgement I’m imposing on it. I have friends that would argue me down that the drugs help their creative process and the cigarette … Read More »
Some weeks ago I received a rather acerbic email from a reader lambasting me for my relentless focus on productivity. Life is not just about productivity, he said. It is about relationships. Have I thought about this? Maybe people don’t want to be working day in and day out in factories or offices. People derive happiness from relationships not money and being poor doesn’t mean being unhappy. Our country will suffer because of people like me who come with western ideas to spoil the fabric of our society. And as I have come to realize, this particular reader’s opinion is a fairly common one.
Last week I was going through the Kerala backwaters in a small boat with my kids and I almost could see his point. Life expectancy in Kerala is 78 compared to the 55-65 range in the rest … Read More »
A couple weeks ago we surveyed readers like you to see what your perceptions were of rural India with regards to mobility and connectivity. We also wanted to get a sense for how different your own behaviour and access is from the villagers. We asked you to guess different parameters about infrastructure and behaviours in the region of Vadipatti (i.e. Vadipatti Taluk excluding the town) which is in central Tamil Nadu. Whoah! you guys were way off. Most of you guessed that the villagers had less access, mobility and connectivity compared to you but you just didn’t realize HOW MUCH less. Here are the results:
Who answered the surveys
125 people answered this survey online. 75% were from the major Indian cities. Of this half were from Chennai which is the closest major city to Vadipatti Taluk and the rest spread out … Read More »
Over half the world simply subsists – caught in a cycle of supporting ones immediate survival. More than half of India is a subsistence economy. The word subsistence is a derivative of the word ‘exist’ which comes from the Latin word existere meaning ‘to emerge’ or ‘to be’. But what does it really mean to subsist? Typically it is thought of in terms of poverty – some amount of money that people earn – but to me it is not equivalent – I think it is better defined in terms of an energy use cycle.
Here’s what I mean. In rural India, according to the NSSO studies, people use 50% to 70% of their income to buy food which means the majority of expenditure goes towards fueling the survival of the body. Compare this to the United States where it is … Read More »
For those of us with a memory of India in the 1980s and before there is no doubt at all that this is a country moving forward economically. From my schooldays when there were only two or three sub-standard brands of everything from soft drinks to soap to chocolate to cars, today’s India is remarkably different. It’s not just that there is every major brand available today. There is construction everywhere and sleek glass buildings are slowly but surely replacing old concrete structures. And there is a palpable feeling of change and a growing national pride. Incredible India. Every so often I get caught up in it and then I look at the numbers and I realize how easily we can distort our self-perception.
Here are the facts. India and China are often compared as the Asian giants, both with over … Read More »
About 200 years ago it was discovered that diamond, like graphite, was made entirely of carbon. One brilliantly reflective, the other black; one hard, the other soft. How was it possible that two things with properties so contrasted could be made of the same thing? With this discovery came an extraordinary insight: what mattered was not the element itself, for the single carbon atom in isolation had no particular properties. What mattered was the bond structure.
So what does this mean? A chemical bond is simply a probability of how much time electrons from one atom spend hanging around in the space of another. In the case of the diamond the carbon atoms are strongly bonded to each of their four closest neighbours giving it the property of hardness. And so closely engaged are these atoms that when light energy enters … Read More »
The attraction of the United States for immigrants has been the hope of social mobility. That with some hard work and good ideas you have a shot at a better economic life. In India social mobility is far more elusive. For a long time there was little expectation of it. People knew and accepted their place. Today something is changing. Hopes are emerging. Aspirations are rising. But what does it take to create conditions that allow social mobility? Why is it so hard the world over to achieve and hold on to?
Our biology and natural social structure works against social mobility. For starters, we generally pass on our wealth to our children rather than to society at large. In India a little over 80% of the rupee billionaires inherited their billionaire status (compared to 20% in the United States). But … Read More »
The greatest differentiator of humans and our triumph as the alpha species on the planet has been our increasing ability to record and share our collective knowledge. With this ability, each new generation, rather than reinventing the wheel, can stand firmly on the shoulders of those before to reach further. Today with the internet we can do this better, faster and among more people than ever before. Wikipedia is an incredible example of this. Today Wikipedia has over 15 million articles contributed by several hundreds of thousands of people and is one of the largest and most actively accessed public repository of human knowledge. These articles are in 281 different languages. Yet almost 30% are in a single language – English. No surprise. The top ten languages – all western European with the exception of Japanese and Russian, account for … Read More »
For tens of thousands of years of human history the world over looked like our village landscape – no running water, no electricity, no cars, no phones, no printing press and low literacy. You have to wonder then how all of a sudden some parts of the world experienced an explosion in innovation and enterprise over the short span of a few hundred years to bring this all about. What was the driver? Surely it didn’t happen because of a king handing out gold coins or jewels from his coffers to the peasants (‘financial inclusion’?).
Some time ago I was lamenting the difficulty of getting new product information to people who live in the villages – no phone, poor road connectivity – and my husband very helpfully offered up that it sounds like we need to have heralds, messengers and town … Read More »
Apparently this last year the per capita income of Indians increased to Rs. 46,492 per year. That’s Rs. 3874 ($85) per month. Glory days! The ‘average’ Indian is no longer living in ‘poverty’. But really, per capita income is an average and who cares about the average income when the average Indian hardly exists. The distribution of income is highly skewed and looks like this (see my last related post ‘It’s not a pyramid’). You can see where that places the average.
Yet when we think of an average we make certain assumptions about the spread or distribution of the values that go into this number. If you say the average height of people in India is around 5’ 5” with a standard deviation of 5”, it’s pretty intuitive what that means – that when you arrive in India you will … Read More »
CK Prahalad’s book ‘The Fortune at the Bottom of the Pyramid’ firmly established our visual impression of the world’s economic landscape as a pyramid. So much so that ‘Bottom of the Pyramid’ or ‘BoP’ has become part of daily lingo. Except it’s not a pyramid. A 3D visualization of how income or wealth is distributed in most countries, including India, looks nothing like a pyramid. It looks like this:
So what’s in an image? A lot actually. There’s a reason for the saying ‘an image is worth a thousand words’. The pyramid suggests to us that the problem of poverty is a lot less dramatic than it actually is. The real picture presents a problem of far greater magnitude than we might ever have imagined. If you are seeking the fortune at the bottom, you might think that this suggests a … Read More »
For people engaged in the social entrepreneurship space, one of the most difficult questions is how to measure the positive social impact you make. How do you know you’re doing net social good?
What we typically do is assume that our product has intrinsic positive social value and so simply measure how many people have used our product or service. Then we make grand statements like ‘We have positively touched a million lives’. For some products this might be all it takes. Take solar lanterns, for instance, a solar alternative to kerosene lamps that is cheaper, brighter and healthier. A simple count of product sales in un-electrified areas might be a pretty reasonable indicator. For many other products and services though it is far more ambiguous. Microfinance, pharmaceuticals, health services, education. All of these have great potential for good but also … Read More »