The “I” in Paris

Wednesday 9, 2019

The “I” in Paris

Wednesday 9, 2019

An International Conference to Examine the “I” in Global

What does the letter “I” in Paris represent? Perhaps it is the individual small business owner, trying to eke out a living. The incubation of innovation by institutions triples the “I” as universities and foundations that support university research establish formal operations designed to help individuals who are potential entrepreneurs actually initiate entrepreneurial ventures. Or it might be investment innovations designed to increase profits for financial institutions.

An underlying metaphor for all of the above is known as “the butterfly effect.” In its best-known form, the butterfly effect shows how the flap of a butterfly’s wings in Brazil has a tiny (but crucial) effect on the wind in the immediate vicinity. This, in turn, has a stronger effect on wind patterns and, ultimately, on weather. The final effect, carried out after a long series of increasingly strong impacts, is to create a tornado in Texas. Consider how each of the following actual and potential butterfly effects, represent one or another interpretation of the “I” in global.

The Individual. In Tunisia one poor fruit and vegetable vendor, seeking only to provide food and shelter for his family, immolated himself when authorities refused to stop harassing him. Today a leader sits in Damascus, 2400 km away, worried that nothing he can do will stop unarmed demonstrators who are demanding an end to his family’s forty-year rule and keep the masses from bringing down his regime. The “Arab Spring” that began with the action of one individual has already toppled three dictators and may have been the impetus that led King Saud to decree suffrage for Saudi women. And the butterfly is still stirring the air currents.

Incubation of Innovation by Institutions. Universities and research organizations have traditionally focused on developing basic scientific knowledge. Today, however, there is a growing emphasis on applications of knowledge, that is, innovation. And not only has the focus on innovation increased, it has shifted from simply generating patents to providing a setting in which innovative ideas are “incubated,” that is, provided with development resources that may result in practical and marketable innovative products and processes. Institutional policies and commitment to incubation of entrepreneurial innovation are, however, far from widespread, despite the potential for producing economic growth. What institutions will engage, like the Defense A Research P A, to produce the next internet butterfly effect?

Innovations in Investments. Beginning in the 1990s, banks and financial institutions In the U.S., Europe, Asia, and elsewhere created innovative new products and established entrepreneurial ventures to market them. In the U.S. loans were made to individuals who wanted better homes and better lives. A great number of these loans were, however, almost certain to fail because the borrowers did not have the resources needed to maintain payments, especially when the housing market collapsed and the economy nearly collapsed along with it. Even worse, these loans were packaged as “securities” and sold to investors as “collateralized debt obligations” or CDOs. A small initial (and generally desirable) cause, the desire of individuals to own homes, has already produced massive (and negative) outcomes, namely loss of those homes and institutional failures. Will the U.S. government or one of its agencies discover and carry out some small action that might reverse these changes?

Innovation and Entrepreneurship. The last two examples illustrate an important question, that is, what role should national and international policy play with regard to innovation and entrepreneurship. There are, of course, various more specific questions, such as, “What is the role of national and international policy in driving and supporting the sort of innovation and entrepreneurship needed to spur economic growth and development?” That is a question of particular relevance given the global economic crisis of 2008 and the continued potential for future economic crises.

Small changes can produce massive, even global, outcomes. That is the point of the first example, an illustration of the butterfly effect. The “I” in global reminds us of the importance of innovation, which the economic theorist Joseph Schumpeter argued is the driver of economic growth and development by means of a process he called “creative destruction.” But it may also remind us that individuals, entrepreneurs, are the actors that are crucial for such innovation and change. We should realize that globalization (there’s that missing “I” again!) is ultimately linked to the individual, just as the movement of a butterfly’s wings may be linked to dramatic changes in the weather a continent away.

The world is constantly creatively destructing and reconstructing itself; individual innovation and entrepreneurship are playing critical roles. Institutions—such as the ICSB 65th World Congress in Paris—can help initiate positive trends for the future. (ICSB 2020 Paris). 

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