Cornell FSE # 04 – (Mis)Fortune at Base of Pyramid

18 February, 2009 at 01:33 2 comments

[via ‘The Great Convergence’ document of Cornell FSE (c) Stuart L. Hart]

    Alongside the “clean tech” revolution, commercial strategies for serving the bottom (or base) of the income pyramid (BoP) have also emerged over the past five years. Dozens of global corporations and hundreds of smaller social enterprises around the world have now initiated or deepened commercial experiments to serve the four billion poor who have been largely bypassed by economic globalization to date. These initiatives may hold the keys to a new, more inclusive form of capitalism.

    But as business momentum in the BoP has grown, two problems have become apparent: First, many companies have chosen to simply adapt environmentally unsustainable products and services to sell in the BoP “mass market.” Left unchecked, this path clearly leads to environmental oblivion. Second, increasing corporate activity in the BoP has raised growing concern that such strategies are nothing more than the latest form of corporate imperialism—veiled efforts to profit by selling extractive products to the poor. Already, there is a growing backlash movement against BoP. Taken together, these two emerging problems could derail the entire BoP agenda.

    To make matters worse, rapid economic growth in the developing world has focused primarily on conventional strategies of rapid industrialization: Massive public investment in centralized infrastructure (dams, power plants, factories, roads, and public works) coupled with foreign direct investment and market reforms. China, for example, has been able to achieve astonishing rates of growth by becoming the “workshop to the 3rd world” – much as England did in the 18th century. This growth comes, however, with a high price: massive environmental degradation, growing inequity, and rising international concerns.

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    Entry filed under: BoP, Citizen-Journalism, Deesha, Economy, Health, India, MCe2, News-Media, Politics, Poverty, WebXP.

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    2 Comments Add your own

    • 1. Rob  |  20 February, 2009 at 00:46

      I’m not usually a person that would take the time to reply on a blog but that post was very well done.

      Bob Doyle
      Shelf Companies Inc

      Like

      Reply
    • 2. kudqdkbcu  |  19 March, 2009 at 17:40

      blah

      Like

      Reply

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