Prosperity Unbound

I participated in a fascinating one-day seminar hosted at Stanford University, in Palo Alto California, cosponsored by the Hoover Institution and the Kauffman Foundation on How and Why of Promoting Entrepreneurship Abroad.  The seminar featured a panel of leading economists, a senior State Department Official, organizations promoting entrepreneurship, and foreign-born entrepreneurs who have succeeded in the States. The seminar was organized by Richard Boly, a national security affairs fellow at the Hoover Institution.

What I found intriguing was the energy in the room, the vibrant discussion, and the fact that leading economists, entrepreneurs, and policy makers increasingly recognize a key obstacle to entrepreneurial development abroad: the problem of informality.  Informality is the spontaneous generation of markets transaction outside the formal structures because of high barriers to entry generated by both public and private organizations (e.g. massive amounts of red-tape or curbing venders in a sector with heavy licensing fees or barriers created due to special interests).  Foreigners from India, Latin America, China, Eastern Europe find easier to have a chance to develop their entrepreneurial ideas in the United States than back home (e.g. generally lower barriers to entry).  There were a number of world leading entrepreneurs present including venture capitalists and businesspeople from Argentina, France, India, and Italy (go here for a list of panelists).  It was also a treat to listen to Robert Litan, the revered economist and ask for his views on my work and Prosperity Unbound.  He was sincerely encouraging, and thought the work was a contribution to this area.

Being an economist myself, or I should better qualify: a student of economic behavior, I very much cherished the insights of economist Paul Romer and his thoughts about informality and the tax it imposes on economic growth and entrepreneurial development.

As our discussions explored entrepreneurial behavior what became very clear is the fact that the roots of entrepreneurship are essentially ideas such as that of intellectual property rights (IPR).  IPR is basically the creation a secure environment that allows an entrepreneur to experiment with and incubate his ideas.  Entrepreneurs must be gifted in problem-solving. They also have to be very good risk managers, carefully sifting out weak ideas and coaxing strong ones into a practical reality.

One disturbing curiosity: the dearth of women entrepreneurs in attendance, especially young ones. Though the women in this space were very few, they weighted quite heavily in caliber as was the case with Vinita Gupta.  She was the first Indian Woman to take her company public in the U.S.  Vinita left a profound impression on me in our private conversation as she explained how it was for her to be both a successful entrepreneur a wife and mother. The stories of all entrepreneurs woven into the theoretical context of economics made a captivating and action provoking seminar.