Designing better futures

Microinsurance looks promising for millions

Leapfrog delivers financial products to the bottom of the pyramid.

Disclosure, Andy used to work in the same office I did in New York.  I think and hope he is onto something big.  Being able to believe, act and live long term are some of the keys to sustained development.  Insurance allows for more choice, innovation and freedom of action.

Andy's approach like micro-finance has many interesting innovations relevant to developing countries in delivery and management which make it feasible.  He uses existing social structures, cultural institutions and norms to help deliver and market the product.

Price innovation at a $1 price point is easy, understanding packaging, support and motivations and commercial viability at that price is the key to good service and product design.  Kind of an applied systems thinking anthropology approach to the problem, gotta like that.

MapAction part of the plumbing of Humanitarian Relief

Checklists, processes, communication, clean water, infrastructure.  Not sexy, but the plumbing of functioning society that makes it all happen. Check lists are coming back into vogue.  When that plumbing fails society can fail.  

Maps are infrastructure and vital for co-ordinated efforts.

When disaster hits MapAction Helps out with live updated maps for relief.  This resource will become ever more important with crowdsourcing.  Co-ordinating resources in disaster zones is a challenge and this looks like a very interesting NGO to watch and support.

I am a big map fan.  We keep a 1957 globe in our living room as it shows how things change over time but still stay the same. My wife and I have lived, traveled or worked in dozens of countries.

My own interest in geography aside from tourism and anthropology field adventures is about dead capital, which I would like to help get rid of. 

For those looking for adventure and charity, check out this rally from London to The Gambia in $250 cars.  The cars are auctioned off in The Gambia for Charity.

We were all signed up and ready for this adventure in 2003.  I was pouring over maps and guidebooks all jazzed. At the last minute we had to chicken out due to work (or lack thereof) issues.  I had camped and traveled for a few weeks in Morocco in college and spent a solid month in the Nigerian southern sub-Sahara desert and was excited.

This video kind of explains the drive across France, Spain, Morocco, Western Sahara, Mauritania etc.:

My wife had a slightly rusted champagne colored 1983 BMW 3 series worth about $500.  It was already for a one way road trip to The Gambia in West Africa.  I was thrilled about the rally and will eventually do it.

During the summer of 03 the little car took us safely from London to Southern Sweden.  Sadly it was left behind in London when we came to the US.  It is now safely in the hands of a London based drummer.

Property Rights index one key to a $9 trillion dead capital problem

I believe efficient and recognized property rights to land etc. are one of the keys to sustainable economic development.  Hernando de Soto  puts forth the case for property rights very well and has aided in the registration of hundreds of thousands if not million of homes that were dead capital.  I put de Soto as an odds on favorite for a Nobel in Economics or the peace prize in the coming years.  de Soto and Amartya Sen are truly interesting economists.

Dead Capital

To learn more about dead capital visit here.  There is $9 trillion sitting in developing countries ready to be used, by their own citizens.  That is development power waiting to be used.  No foreign aid required.

Here is the latest Property Rights index showing the world where it is easy to register property. There is a strong correlation between property rights and GDP/capita and most other development indicators.  Correlation isn't causation, but there is some compelling arguments here. 

International Property Rights Index is the publisher of the report.  The follow in the model of the Doing Business report put out by the World Bank, which is conceptually similar to Transparency International's work on corruption perceptions indexes.

Dead Capital fixes have a high ROI

For those interested in understanding big global problems and why property rights change has such a high ROI check out this book Solutions to the World's Biggest Problems.  It totally rocks.

IPRI and Transparency International do a lot of good and my hope is that the publications create social pressure for neighboring countries to compete positively to improve their relative metrics.  My only wish would be that the data was open and that the details of the process for property and business registration were public in a wiki format, so that wonks could start hacking and advocate positive changes.  We all need more live capital.

how an index and data help with these problems.

1. Raise awareness using simple comparative metrics
2. Allow for research econometric and social into outcomes costs and impacts
3. Raise competitive instinct in peer countries
4. Provide a public forum for reflection and desire for relative improvement over time

My own idea is to have a process based "workflow" wiki, to allow technocrats and field researchers and lay people to capture and study real world and best practices in property registration, transfer, recognition and dispute resolution. 

Best practice for property registration means, cheap, fast and law abiding. The idea is that various states and regions can study solutions can best practices can be deployed.  The federal system is predicated upon this idea for nations.  Info sharing between states, technocrats and individual actors could free up trillions for poor people.  Property Wiki is that idea.

Maps, Haiti and development via digital tools

I am thinking & working slowly on the concept of facilitating the registration of property via open source tools.

The idea is property law wiki.

Making Property Law Wiki Real

View more presentations from ngogerty.

  It is estimated by Hernando de Soto that there is $9.3 Trillion worth of dead capital in the world. World bank video here These are resources such as real estate that can't be fully used or valued because they are un registered.  The reasons for this are myriad as will be the solutions.

The idea is that by freeing capital via registration it can be used more efficiently.  For example if you are a 3rd generation squatter in an urban city in a developing country, you can't officially sell your house.  Any value you capture will be at a severe discount.  You can't borrow against your home or officially hand it to your family members.  If you want to learn more about the opportunity of unleashing resources that already exist in a country check this video out or look around on the site at this link.

Google maps is a tool that allows for people to collectively identify and place resources and assets into the public domain. 

Haiti for example is in crisis and the available resources are fluid.  A dynamic updatable map represents a significant strategic and tactical tool to deploy resources.  If you want to learn more about Google maps or have experience on the ground in Haiti and can update the map do so.

From a digital geek perspective, it seems like having various organizations have updatable layers and resource tracking that they could expose to the proper authorities or co-ordinating agencies would be very helpful.  Kind of a 3d wikipedia map.  Then make it a mashup supporting flickr links etc. so that quick snapshots and notations could be made on the ground. 

This all sounds overly high tech, but the tools to do it will get cheaper and easier and are already emerging.  Super ordinate tasks such as disaster relief logistics are perfect for this type of thing.  Architecture for Humanity is doing some things.

The World Bank of whom I am fairly critical has done some really good work with the Doing Business Reports.  It does all the right things in terms of measuring, soft competitive pressure via ranking and public availability of information. I hope they or someone else does the same type of work for property registration and recognition.  It is a huge opportunity.

To sum up good maps and live updated detailed maps in place before disaster can save precious hours and days when a disaster happens.

Full Disclosure: I lived in Haiti for 6 months as a small child.

Web 2.0 vs. Corruption

One of the most debilitating factors in economic development is corruption.  Corruption not only soaks up the efficient allocation of resources, but also shrinks investment horizons to near zero.  Why invest in education for your family or children if corruption means jobs are not based on merit.  Why invest in building a home or business if they can be taken.  Endemic corruption and poverty go hand in hand.  For some reason I have a strong visceral reaction to corruption, something about the Iowan in me. 

Having traveled a bit and spent time in the 3rd world, I have witnessed the costs direct and indirect of corruption.  I studied economic development in university as a focus of my anthropology degree. Here is a good academic papers on how corruption impacts people far beyond the bribe paid.  Here is one involving roads from the IMF.

Many assume corruption to be a 3rd world or poor phenomenon.  It isn't. Here is a list of countries ranked from the very credible Transparency International Survey.  The US made it to 19th place this year as the least corrupt place. 

Studying economic development is important.  The US is currently undergoing massive Economic Stimulus across sectors and industries yet, I have yet to hear of a single case of reaching into development studies that may offer lessons as to what works or doesn't. 

Corruption costs big time.  Land use, and registration is one of the things that gets hindered by corruption and is a point of interest for me.  It is a $9.9 trillion problem mostly affecting the developing world.

The Good News is Feedback

Better process design and feedback loops typically resolve corruption.  Investigative journalism, public feedback, freedom of information acts etc.  all aid in this.  These tools if available and functioning are effective unless corruption goes to the top of the political structure. 

The bad news is that if corruption goes all the way up, as in Russia it won't go away until leadership changes.

Here is a video highlighting the nature of Russia's problem. Poverty and corruption are highly correlated. Although a specious argument Russian male life expectancy of 59 years which puts it at #182 out of 227 countries is probably not helped by the issue.  Corruption and its economic burdens costs the average Russian citizen a lot.

So what can You do with your spare time to help out.

Check out these websites and see if there is something you could do.  If you have spare time and skills this would look pretty sharp on a resume.  Creating tools that make things better is pretty powerful stuff.

These are US sites, but a quick google search should bring up other projects in various countries and regions:

• Sunlight Labs
• Expert Labs
• Property law wiki (just an idea at this point from me)

It is starting to work in the developing world.

Here is a video from TED about a person who wants make a business out of fighting corruption.  The positive externalities from this would huge.

Pro globalisation via the BBC

All though not fashionable, here is a helpful video that offers some support for globalization and business as a potential force for good.  The arguments for or against business are often shouted, lacking the nuance and listening found in good debate.  Many rarely consider global sources as legitimate voices for global issues, preferring convenient sound bite loaded local media outlets which may merely amplify opinions already held.

This video hints at the importance of property rights, free trade and other vital components in development.

This video puts forth a few helpful pro-arguments for pro-globalisers.  Whether you are pro or anti globalization, educating oneself makes the debate more interesting than partisan rhetoric. 

A good debater who has deeply considered an issue can articulate arguments on behalf of both sides of an issue, it also makes for more interesting conversation.

Shit book hints at one key to human development

Excreta, turds, poo, shit, etc. are all terms for something that induces disgust in most.  This response is innate and indeed wired into use at a visceral level and a key to survival.

All we need to know about shit, is that we want to be away from it.  Sadly many can't get away from it, they end up living, inhaling and consuming it.  This leads to death and disease. 

In development people refer politely to water borne disease leading to over 2.2m child deaths per year according to the UN.  Water borne diseases in most instances relate to drinking shit polluted water.  Too put that in context AIDs is estimated to kill 2.0 million and malaria around 1-1.5 million per year.  Shit kills.

This is a problem that the now developed world has kind of solved and that the developing world is still working on.  Like all human endemic problems it is rooted in behaviors, beliefs and fears.

Understanding shit and what happens to it is key to human development as much as economics, corruption etc. and curing diseases are.  Indeed, solve the shit problem and many of the diseases that limit human development and factors related to GDP growth may resolve themselves a bit.

Rose George has written a very entertaining and important book entitled The Big Necessity in which she travels the world discovering the cultural issues and mores around handling waste.  Her voice is that of the economist magazine, for which she once wrote, humorous, well read and considered.

If you are interested in the human condition and understanding the behaviors, and issues that may better it, read this book. 

I am fascinated by economic anthropology and sustainable development and appreciate the field work that George has done in trying to understand what the solution to the problem of shit may be.  Solutions aren't just about plumbing and digging toilets.  Like most aid dropping in money or technical help rarely does anything but minimize acute crises.

Marketing, behaviour, economics and technology, distribution and other issues.  Consider it a business problem/opportunity. This is a fascinating book about something that gets very little attention relative to its impact on limiting the human condition and capabilities.

Rose George's description of techniques used to change a village's behaviour, involve economic incentives and changing beliefs while raising awareness. The lessons about motivating people for sustained change are as relevant to the business manager as they are to the aid worker.  technocrats and major aid institutions often fail in these areas.

Factoids:

• Thomas Crapper helped improve the usage of the toilet in London, hence the phrase "take a crap" (perhaps best to leave it)
• For all of the butch culture, Americans are very prudish in the waste dept.  euphemisms abound in the culture
• the japanese have the most advanced toilets in the world, warm seats, water wash etc.
• Wiping with paper is very unsanitary relative to washing with water
• Since 1994, 935 million gallons of raw sewage have been dumped into lake Michigan
• German men pee sitting down
• Chinese put used toilet paper into trash bins instead of flushing it away
• Many chinese public toilets have no stalls or barriers, so people get to know each other very well
• The average shit session yields 250 grams about .551 pounds of solids
• 1.7 million people in the US don't have a toilet
• The corridors of the palace of Versaille used to be filled with urine and fecal matter as people had nowhere to go, it was an honor to hold the king's chamber pot while he filled it.
• 400,000 people get sick in 1993 in Milwaukee from feces contaminated drinking water killing 100
• The UK has 186,000 miles of functioning sewers that are 250 years old
• One of the only cures for a "superbug" infection is a fecal transplant
• Wash those hands: in the UK "more than 1 in four people have faecal matter on their hands"
• over 40% of people don't wash their hands after going to the toilet
• much more in the book about a key element of the human condition, namely shit

You get the point the Shit book (The Big Necessity) is interesting, educational and important about something "polite" people don't talk or think about.  If you are interested in sustainable development, furthering the human condition or understanding how to drive change among a group of people with a fixed behavior check out this book.

Unsexy but vital: Bureaucrats without Borders

The title of this blog Designing Better Futures reflects an idea.  The idea is that Design (the thoughtful act of production) might help make the future better for many.  I am interested in design with a high ROI in sustainable economic development for poor countries.  My beliefs are more in line with William Easterly than Jeffrey Sachs.  To put it simply Easterly wants it aid to accountably to work, while Sachs wants to throw money at it until it works and feel good about it. 

If you really want to make a difference, please think before acting. Feeling good about yourself and doing good for others aren't necessarily the same thing.  The best results rarely are the ones that make you simply feel good. Real development impact is unsexy hard work, like building or designing a latrine to reduce infant mortality.  

Read Easterly's fantastic book, The White Man's Burden and then compare it with the feel good money pit approach from Sachs entitled The End of Poverty.  Another thoughtful book on world problems is The Copenhagen Consensus.

In looking for high payoff sustainable development ideas, I have been very interested in micro-nutrients, iodized salt, Vitamin enhanced golden rice etc. 

Basically I look for cheap projects with huge positive externalities,mega-bang for the poor persons buck.  These are things that can cheaply add years to life capabilities or raise the collective IQ of a village sustainably without creating aid dependencies etc.   The trick is in the distribution and self sustaining of the enhancement in the poor's lives over time.

Another high value add, that I am deeply committed to is Property Rights and the wonky delegation of those rights via efficient registration processes.  Recognizing Dead Capital* as defined by Hernando de Soto and properly bringing it to life could create Trillions of $'s for the world's poorest and enfranchise them in their own political systems.  An enfranchised middle class is a powerful force. 

To that end, the unsexy stuff needs technical help.  Forget the easy emotional appeal of feeding babies in times of crisis, put the unsexy infrastructure (soft(bureaucratic) & hard(project based)) in place to mitigate mass starvation in the first place. 

Medecins Sans Frontier (doctors without borders) is very high profile do good stuff, but what could even be more important would be plumbers, engineers, lawyers and tradespeople without borders.  The resources (motivated people) are probably there, the organized charities aren't. 

Imagine plumbers or civil engineers or Quality Assurance people helping out in countries on the "soft" infrastructure, either training or jsut learning about it.  My own goal would be land registrar consultants without borders.  I view it is a $9 trillion unsexy problem.

A good example of an unsexy but important charity is Reporters sans frontiers.  Good reporting acts as a feeback loop and curb the abuses that may lead to socially inflicted humanitarian disasters.

The video below hinting at the need for Bureacrats without borders, warning it dry and wonky.  A council on best practice for bureaucracy inter governmental with benchmarks such as the World Bank's excellent doing business report would be a very good thing as it measures the "output" of a govt. service and allows for govt and citizens to hopefully seek best practices from peers.

Imagine the same for the planning processes for infrastructure, planning and deployment of basic govt. services.  Bureaucrats without borders sounds horrible, but could be wonderful, it may even get rid of some corruption which acts in some instances as the only effective way to progress in some states.

*Unbelievably there is no wikipedia entry for such an important concept as "Dead Capital".

Full disclosure Bernard Kouchner, founder of Medecin Sans Frontiers spoke at my MBA commencement in Paris and my undergrad at the U of Iowa was anthropology where I independently focused on economic sustainability in West Africa.

Unsexy soft infrastructure & economic development

One thing taken for granted but crucial for stable economic growth  is equal access and recognition before the law.  Economies are social systems reflecting behaviours bounded by informal and formalized rules. 

Unfortunately most Economists, regulators and Finance types don't get this.  Behaviour or social dynamics are a bit too non-linear to model effectively.  This doesn't limit finance and economic types from applying mean-variance risk models to everything they see.  These same confident people then turn to shock and surprise when things don't work out, but proceed on with the approach all the same. 

A classic example of this is the well meaning but dangerous Myron Scholes (Nobel prize winning economist). He just blew up his second multi-billion dollar hedge fund. Please keep this man away from portfolios.  I would posit that more economic value in the developed world has been destroyed by economists and risk managers using mean variance models than most natural disasters(see report) over the last 10 years.

Sustainable economic development & legal enfranchisement

If one wants to help a developing country, I would recommend studying a few that developed sustainably. One of the more fascinating examples is the United States as described by Hernando de Soto in the 18th & 19th centuries in his book Why Capitalism Triumphed in the West. The lessons about the value of legal access, a functioning bureaucracy, fairish treatment before the law and property rights is profound.  These intangible things were paramount to building the United States and most developed countries.  The soft infrastructure evolved over time from crude or non-existent concepts to become pillars of developed economies. 

 If it were up to me Hernando de Soto would receive a Nobel Prize in Economics.

Without the evolution of soft infrastructure in the form of equal access to land and property rights (minimal corruption required), many countries would not and cannot develop.  My own hope is that more money is spent researching the soft infrastructure of legal enfranchisement and property.  I am a cheap sustainable development type preferring soft infrastructure over hard infrastructure such as externally financed dams and roads etc.  I don't believe in the Jeffrey Sachs & Bono ego gratifiction show that believes sprinkling the World with $150 billion will solve everything.  This is a classic case of a consumptive culture laying its framework onto a problem.  i.e. can't we just shop or buy our way to a solution.

Money applied intelligently is part of  a solution but we still haven't gotten the intelligently part right.  Buying things is easy, getting people to adopt ideas and codified behaviors is difficult.

For the price of one hydroelectric dam or project finance, a lot of legal and economic field research could be applied to understanding, selling and implementing property rights and creating huge amounts of value for the poor. de Soto estimates the payoff from these soft measures in the Trillions of $'s.  For a critique of why the Bono & Sachs give away wastes precious emotional and fiscal development resources, read this excellent book from William Easterly. 

The US is a useful example to learn from in terms of property rights and the economic power that comes from pursuing equality both in making and accessing the law.  Yes, the current economic issues look daunting, but they are minor in the face of a wildly succesful 200 year development experiment which has provided so much for so many.

  In that vein, a report put out by the UN, entitled Making the Law Work for Everyone makes interesting reading.  The report deals to a degree with the distribution of legal rights in various countries.  My guess is that the variance in legal enfranchisement correlates with economic and political stability. 

 Applying a metric of legal enfranchisement into debt risk ratings etc. or international aid policy initiatives could help foster both sustainable economic and human development.

One critique I have of the UN report is the use of the word empowerment.  Social and political power is typically viewed in a zero sum context.  Thus empowerment is not conducive to constructive dialog among parties.  The explicit desire for power instead of participation thus becomes more militant in nature than solution oriented. 

The good thing about using the concept of legal enfranchisement vs. legal empowerment as a conceptual catchphrase is that enfranchinsement provides a long term win for everyone in terms of stable economic growth and fully participatory political environments.

How to build a culture: Stewart Brand

Why don't we think like this?

Oh and if you liked that watch the series on architecture how buildings learn here. I am a huge architecture fan as buildings reflect thought (design)  and culture in physical form.

Design like you give a damn

The book Design Like You Give a Damn is a fascinating read and really shows the value of thought and design.  Most people assume design is about picking a color or making things look nice.  This is the most surface level aspect of design.

Design is about choice.  This book edited by Architecture for Humanity is about the choices that architects and other designers can have have to improve the world.  The books chapters include  designing for disaster relieft (think shelters for Tsunami's floods and IDP's (refugees) and the social issues that produce poverty etc.

The constraints and problems posed in these situations are as difficult as the answers and solutions are important.  This book is a great read not for people who want to feel good about writing a check for UNICEF, but rather for people who want to understand some of the mechanics of what makes NGO's etc. tick.  Like a well edited cook book, it doesn't have a political or preachy agenda per se, but rather offers an interesting presentations of problems and solutions.

Helping out requires thought.   The book is extremely well layed out, accessible and dare I say it fun to read. The sections show how architectual choices are made to make a difference.  This involves everything from green architecture to homeless shelters in urban areas, site analysis, costs and social impacts of shelter.  The book is a great read.  You can learn a few things about the origins of Habitat for Humanity and others.

Shelter is a basic human need, meeting that needs in extreme conditions, either environmental or social (war) etc. is a fascinating and worthwhile challenge.  Even if you aren't a designer, pick up this book, it is great in terms of lateral thinking.  You can always e-mail me to borrow my copy.

a little feedback please

All successful (stable) complex systems rely on feedback internally and externally to thrive and survive.  This includes, biological and social systems.  Capitalism is one such system.  You vote with your dollars and things happen all the way up and down a supply chain.  Governments are a little slower to respond, because quite often they have a monopoly on various services and the Ballot box is a fuzzy feedback device.  In many countries the ballot box may not be an option.

This week the OECD announced something called the Istanbul declaration.  This small declaration asks for more public information and desires to treat govt. statistics as a public good.  This could definitely help turn things around in many countries by improving bureaucracy and poor policy, the primary causes of corruption.  This is a long term goal and the Istanbul declaration is tiny drop in a huge ocean, but a welcomed none the less.

Did you know that in China, some macroeconomic information is considered a state secret and thus can subject the discloser to potential death for releasing it.  In theory even projecting such data could lead to punishment.  Economics can be a dangerous profession.

property wiki works like wikipedia see video

here is the founder of wikipedia, jimmy wales at the TED talks.  More popular than the New York Times

The wikipedia has 7.3 million articles in over +200 languages all non-profit and contributed efforts.  Property law wiki is going to try and make "processes and procedures" for property holders formal and informal better all over the world.

making property law wiki real

some ideas on making property law wiki come to life. feel free to critique comment and help me improve this project.

framing a problem

OK, my skills are limited, so I use PowerPoint and windows MovieMaker.  Here is an attempt at communicating about property law wiki.  The objecitve is to solicit interest in property law wiki.  If you can improve this please send suggestion or make a film and send it to me.  plw (at) gogerty.com

Here is the source material Download simple_property_lawfilmv1.0.ppt

networks presentation and charity

I am trained first as an anthropologist, that means listening and looking.  Networks wether bio-chemical, biological or digital are fascinating.  Social networks are the Mot du jour.  Here is a nice presentation about them. 

I have written a few posts on a few books I have read about networks, see the math or books section of this blog. I am currently working on my property wiki charity which is trying to use wiki's to solve a super-ordinate problem of making property law more effective and simple for people.  I have been thinking about the problem since 2oo1 and slowly putting together a solution.

Another step on a long journey

Another step taken on my so far 4 year journey thinking about how to make the world a better place.  I enjoy big problems and looking for solutions.  I am also "economical" i.e. lazy so I like solutions that require minimal effort. 

I have worked with some bigs before with varying levels of success:

The world's largest market $1.5 trillion/day Foreign Exchange.  I built a product based on quantitative trading models for the "common man".  Still looking for backs on my Forex Index Money Market Fund.

The largest Software problem Y2K, came up with a quantitative framework to assess world risk.

and now for a huge opportunity to do something meaningful for the World's poor. 

$9.3 trillion market in Dead Capital!

I have spent 4 years thinking about this issue and creating various prototypes, business plans and working with various people.  My solution to this problem is a wiki.  Have a look here.  Ok, I may not be able to solve world poverty, but at least I can give it a shot.  As they say, "shoot for the stars, even if you miss, you may land on the moon."

Today, I launched the Property Law for People wiki.  I look forward to growing it over the coming years.  The adventure is a foot.

Getting Great

Good to Great is a fascinating book which uses rigurous quantitative analysis to indicate that values based companies succeed.

These companies use slow and steady growth to make impressive results.  They organizations all know who they are and what they are doing.  Organizational belief and strong culture are not to be under estimated. 

If you haven't read the book, I recommend doing so, to understand that the organization you work with can improve.

There are some interesting concepts which involve things such as

1. Getting the right people on the bus. i.e. building a strong long term team. 
2. The flywheel, a concept of slow and steady momentum
3. Good is the enemy of the great
4. The hedgehog concept (focus)
5. A culture of discipline

and quite a few others. 

A great addition to this book is Good to Great and the social sectors. I plan on using this for my property wiki project.  This project aims at building a massive open wiki to aid making it easier for people to register property around the world.  I believe that by focus and effective communication a $9.3 trillion opportunity to make things better can be undertaken.   If you are interested in property wiki, take a look at this video highlighting the opportunity to make things better.

$50 billion xmas present.

I flew up to Silicon Valley shopping for money for inclue!  On the way I finished a very thoughtful book on real money and real issues.    How to Spend $50 Billion to Make the World a Better Place, by Bjorn Lomberg is a great read and encapsulation of things I have been reading about for years now.

It is a summary of a brilliant project called the Copenhagen Consensus.  Basically bring together some brilliant minds at the Nobel Laureate level and ask them to rank and rate the problems of our time and where we can get the biggest bang for the buck to help humanity.

The ROI or payback is fantastic on some of this stuff.  2 Billion people suffer from undernutrition as indicated by low birth rate and micro-nutrient failure.  Iodized salt, Iron and Vitamin A can yield a 37:1 pay back.  Micronutrients alone can increase the average IQ in some populations by 13 points.  Other issues touched on in the book include free trade, business regulation, clean water, HIV, War and other problems.

The book is a marvel of clarity and simplicity in terms of language, brevity and summary.  Many pieces in these areas are very scholarly and not digestible much less easily actionable.  The emphasis on quantifiable payback and cost benefit analysis is great.  The data is presented clearly and cogently.  There are enough quantified data points, but no drowning the user in data.  I would strongly recommend anyone who really considers themselves interested in "helping humanity" to read this book.  It may just provide some pointers on where a dedicated life or focus can offer maximum impact.

inventing new sewage systems, reworking regulations and negotiating trade deals, doesn't sound sexy, but it saves lives and makes the human experience better.  For now 1/3 rd of us live on less than $2 a day, 1/3rd of us will get severe Diarrhea  this year and 1/3 of are not literate.  There is a huge scope for improving what it means to be human.  The costs to improve things aren't that great, but the will must be.

Realizing Property Rights Book part 2

There are some interesting sections to the book Realizing Property Rights , one of the more unique and fascinating chapters comes not from an NGO or field worker but rather some thoughtful individuals working with some of Switzerland's largest re-insurance companies.  chapter with 3 interviews by georg kohler, is a great insite into how big business thinks about these problems.

It is too simplistic and crude a belief that business or business people have narrow interests.  Some mistakenly believe business is inherently evil, it isn't in most cases business is benignly self interested, but happens to throw off loads of positive externalities in the form of improved lives via developed markets, stability and capital formation.

The report by the risk management group of Swiss RE's Rolf Tanner isa great read, it highlights the interest the insurance industry has in the creation of private property and how they percieve those properties are secured.

The interview with URS Egger is interesting as well in that it highlights how an NGO for entrepreneurs works on the ground, very telling how a micro VC places bets on people.

The only sad thing about this chapter is its brevity.  Wish the book would have had more thought provoking sections like this.

A chapter by Naoko Felder-Kuzu was a fascinating story of how a woman with who's husband ran away leaving her with a single room dirt floored house, 3 children and $20 was able to achieve her dreams via micro-finance.  This anecdotal story is the stuff of holywood scripts played out over 12 years of a women's life and brings the real impact of micro-credit and property rights to a powerful human level.  Statistics about the amazing impact of legal reform are great, but a human interest piece like this really reminds one about the importance of improving the human condition for all of us and how property rights can do that.

The book Realizing Property Rights has some gems, but could have seriously used tighter editing and thematic co hesiveness.  Some of the doors opened, IPR (intellectual property rights), Women's property rights, legal reforms impact and personal tales of change are great areas for further publication and research in this vital area. 

The human condition all (6.5) billion of us is improving in Economic terms faster than ever before as measured by global GDP output.  The Economist recently highlighted the developing world's GDP is now larger than the developed world in PPP terms annually.  Accelerating the Developing worlds' growth through sustainable means and evolution to having ever more enfranchised, property owning participants will have rich rewards for all, in terms of peace, stability and an improved state of the human condition.

Realizing Property Rights (book)

Realizing Property Rights is a collection of papers put together by the esteemed Economist Hernando de Soto and Francis Cheneval.

Hernando de Soto has probably done more good work for property rights and poverty than anyone alive today.  The qualifier good in the previous sentence, I refer to study and action that will lead to positive change and improvement for millions of people.

Unfortunately, land reform and property rights is associated the dreadful failures of communism and other forms of forced state collectivism.  This is sad as co-erced collectivism has probably led to more death and unhappiness than almost any other concept.  The purges of Stalin and Mao alone led to 10's of millions of deaths and generations of poverty.  Smaller, but no less tragic incidents have occurred in many part other countries and parts of the world.

Property rights, namely private, individual property rights are one of the fundamental bedrocks of the development of the modern world, Western, Eastern, Northern and southern.

The book Realizing Property Rights isn't as effective as Hernando De Soto's earlier and more important work, The Mystery of Capitalism, Why capitalism Triumphs in the West and fails everywhere else. 

Realizing Property Rights unfortunately fails the test of being a good book in this area.  As a book it is a disappointment in an important subject.  The book has too many weak submissions.  The collection of submitters is a list of the great and good in this area, but unfortunately a good activist, policy wonk or field researcher doesn't implicitly make one a good author.  This is sad, the stories and opinions of these people count and the lack of editorial or ghost writing gets in the way of these people getting their messages across. 

There are some solid gems here that make the purchase worthwhile for a few nuggets, should the reader be so inclined.  the Chapter on women and property rights by Robin Nielsen is especially informative on the weakness of Women in developing countries.  The inability of women to secure, hold or transfer property in many countries is a disaster.  In many rural areas, women's property is held by the head of the household almost without exception her husband.  In the event of death or divorce the woman's property is gone.  This means a home, land, small business or children can be whisked away based on familial or village decision.  Culture and tradition is a deep and difficult to understand problem in this area and deserves more field work and attention. 

In my own academic study and personal research over the years, I came to the conclusion, however crude it may be that investing resources in women had the highest payoff in terms of development Goals.  Women invested more in family, education and collective well being.  Women perform most of the labor in the developing world and reap few rewards.  According to Nielsen's research Women produce 60-80% of the developing world's food resource.

Invest in women! I say this not as a gender issue, but as a hard nosed investor.  Women yield the higher development ROI (return on investment).

Fortunately a UN general assembly passed a CEDAW (convention for the Elimination of all forms of Discrimination Against Women) in 1979.  2 and half decades later 180 nations have ratified CEDAW.  Legal ratification and change on the ground can be different things, but this a step in the right direction.  This isn't just a poor world issue after all Switzerland only granted women the right to vote in 1971 

I won't go into the issue here, but female property rights and culture is a fascinating topic, everything from dowry, to collective ownership makes for fascinating reading about the human condition and the evolution of cultural norms.

Costs of doing business make people poor

The Worldbank has just produced it new Doing Business report.  There is clear evidence that economic freedom and commercial development have a high degree of correlation with human development.  Have a look at William Easterly's work

The world bank puts out some data on the cost of business in various countries.  I decided to "normalize" the data so that people could appreciate it more.  Many people think that poor countries are poor due to apathy or cultural limits of their citizens.  This is rarely the case.  Government bureaucracy limiting property rights and the formation of business play a huge part.

I have taken the costs from the Worldbank database and adjusted them to US and other countries incomes.  For this blog post, I will refer to US adjusted cost basis.  In Ethiopia a small entrepreneur wanting to start up a business has to secure $26,951 just to set up a company versus $207 in the US.  No surprise there aren't many small businesses registered in Ethiopia.  It costs $32,005 just to fire someone in Ethiopia.  Not surprising that many don't get hired in the formal economy.  These costs have nothing to do with computers and technology, they are old fashioned red tape.

What ends up happening is that the black market or informal economy is 40% of the Ethiopian economy as a whole.  That means 40% less taxes for the government and limitations to growth as "black market" companies can't scale, get capital and are subject to extortion.

I have compiled a database of countries and comparisons.  Here is a screen shot

I am also making the data available to anyone who wants to share quote or forward it.

Download DoingBusinessAlldataupto2006.xls
 
If you do make improvements or have suggestions please contact me at nick (at) inclue (dot) com

Consider the document under a Creative Commons license. 

This work is licensed under a Creative Commons Attribution-ShareAlike 2.5  License.

Great World Bank Site

The World Bank has published a very intriguing site called DoingBusiness.org Benchmarking business regulations.  The title sounds boring, but the potential for positive impact in the developed and developing world is anything but.

Many charities have strong emotional appeal, feeding starvation victims, minimizing conflict, fighting disease etc.  Many charities are very successful due to their appeal to basic emotions.  The ability to reply to cry for help is powerful.  these organizations can and do perform much good.  There is however a set of work that has less "sex" read emotional appeal, but can make things better for everyone.

For example one of the leading causes of death among children and infants in the developing world is diarrhea, this is a sad fact.  Another sad fact is that most famines, and other "TV quality" issues are actually preventable.

The Nobel prize winner, Amartya Sen has stated that no widespread famine has ever occurred in a "functioning pluralistic democracy", this is due to the fact that democracies usually have feedback mechanisms that allow for mitigating small crises, before they manifest themselves into humanitarian disasters.

Another issue that is popular currently is anti-globalization.  Unfortunately, the anti-globalisers end goals of better lives for the poor aren't really served by either the protests or anti-capitalist positioning they espouse.  Many studies and reports indicate that development, increased living standards and personal security most often go hand in hand with rising GDP in an economy.  Exceptions do occur for easily extractable mineral or oil resources.

Business creates jobs.  Jobs and property ownership improve people's lives and help the cultivation of a middle class, which usually seeks education and improved say in the national affairs.  Many theories of democracy assume a "Stable" middle class is a key component to a sustainable mature multi-party democracy.

The doing business site from the world bank indicates, some of the legal restrictions that hinder economic and therefore personal growth within various countries around the world.  Better business practice is usually a function of better legal procedure and effective bureaucracy.  This is hardly sexy stuff and most certainly not suitable for the evening news. 

The results of improved business policy and procedure however is truly amazing.  The estimate is 2.3% of growth per year  DoingBusinessReport for the lowest quartile economic performers.  This means $10's of billions of dollars and 10's of millions of lives improved just by changing policy and procedure.  No miracle drugs, flights of AID, foreign intervention or billion dollar wasteful projects.  Change from within countries can create billions in value and change millions of lives.  Now that is sexy.  The payoff from changing a policy relative to the payoff is truly impressive and exciting.

In the next few years, I will be seeking to build an open source website and PR campaign to highlight the opportunities and potential for improving throughout the world.  The core philosophy is that 95% of solving a social social solution, which poverty is, is getting people to agree on the nature of the problem. 

Therefore the first part of my project will be a series of tools to make the Worldbank statistics more media and individual digestible and friendly.  The Worldbank has done a fantastic job of compiling and presenting the data from over 3,000 sources.  My belief is that an open source "wiki" approach which allow open collaboration and access to the data and the related issues, can radically accelerate the rate of change from within the various countries that have the most to gain from improving the policies and procedures relating to property and business at levels ranging from the individual to the small enterprise.

So let's get started framing the opportunity to make things better....

If anyone wants to help out contact me: Nick (at) gogerty (dot) com.

We will need wiki experts graphic experts, flash gurus and many multi-language skilled people.  The oppurtunity create billions in value for millions of people means each volunteer will indirectly have a profound if immeasurable influence for bettering the lives of many.

A life's project: Property Wiki

Some things or ideas germinate, percolate, resonate and finally dominate a life.  They may not always be at the forefront, but they are nonetheless omnipresent for a person.  Property wiki is most likely one of those things for me. 

The objective behind property wiki is to do as much "good" as possible while allowing individuals to determine what that good is.  Property, the access, control, security and stability it brings is one of the foremost concepts in cultural civilization.  Amthropologists don't study it too much leaving it mainly to economists, but the recognition of property, the anthropic claim of "mine" in the fleeting moments that are the individual persons moment has determined more about cultures, society and history than almost  any other driving force with the exception being the concept of self "religion" and the natural human sex drive.

Property wiki is an attempt at helping more people in more parts of the world effectively claim property in a more organized way.  Here is a video synopsis of the problem according to Hernando De Soto World Bank Video (91 minutes but worth it)

The problem is estimated to measure in the Trillions of dollars and affect the poor, even if that sounds a bit tautological.  There is enough wealth in most poor countries to allow them to realize strong economic growth and a leap out of "relative poverty"  The book recommendation is The Mystery of Capital: Why Capitalism Triumphs in the West and Fails Everywhere Else   If you are interested in making a difference using economics, then this may be the path for you.

Property Wiki will use open source software, the web, grass roots participation to frame the problem, qualitatively, quantitatively and most importantly, publicly. 

I came up with the idea for Property wiki over 2 years from 2001 to 2003.  I wanted to isolate what the biggest impact could be for the poor in terms of ROI and non-intervention.  The only other case for high ROI and minimal intervention was micro-nutrients and Iodized salt, both of which lead to higher IQ's and more thinking individuals in the world.

Property wiki seeks to capture the processes and cost associated with formalizing property ownership, management and transfer for small holders in countries across the world.  The thesis being that over $9.3 trillion exists as dead capital , or non fungible assets.  Squatters in small homes, plots and areas around the world, have no security or incentive to develop or increase the value of their holdings.  Freeing these assets would allow for capital to be made available in times of emergency, for personal investments in education or simply to rationalize un-economic assets.  Efficient markets mean more security for individuals, access to opportunity and a larger tax base for governments to build out infrastructure.

Property wiki aims to combine the power of open source wiki's and reporting to capture the steps required to secure property rights.  Property wiki then seeks to use the behavioral aspects of social pressure and ego to facilitate change, albeit slowly.  Property wiki will organize the steps required to secure property rights into a quantitative index so that countries can be compared.  After all the securing and managing of property rights is service and should therefore have relative comparable costs in terms of GDP/capita in various countries. 

Finally it is hoped that by publishing the costs in each country and ranking them from top to bottom, pressure from inside these countries may change these procedures for the better, allowing more people to participate in the "formal economies" within these countries.  A good example of social pressure via ranking can be found in the excellent indexes  published on corruption by Transparency international.