International Development

FSI researchers consider international development from a variety of angles. They analyze ideas such as how public action and good governance are cornerstones of economic prosperity in Mexico and how investments in high school education will improve China’s economy.

They are looking at novel technological interventions to improve rural livelihoods, like the development implications of solar power-generated crop growing in Northern Benin.

FSI academics also assess which political processes yield better access to public services, particularly in developing countries. With a focus on health care, researchers have studied the political incentives to embrace UNICEF’s child survival efforts and how a well-run anti-alcohol policy in Russia affected mortality rates.

FSI’s work on international development also includes training the next generation of leaders through pre- and post-doctoral fellowships as well as the Draper Hills Summer Fellows Program.

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This two-day international forum at Stanford University brought together experts from academia, government, and industry to analyze leading cases of current institutional models for innovation in smart and green industries. Cases included multi-company collaborations, public-private partnerships, and government-funded consortia. To enable more focus and comparative analysis, sectors selected for focus included the built environment and intelligent transportation.

FORUM Speakers & DISCUSSANTS (listed in alphabetical order)

  • Rohit T. Aggarwala, Special Advisor to the Chair, C40 Cities Climate Leadership Group
  • Alan Beebe, Managing Director, China Greentech Initiative
  • Sven Beiker, Executive Director, Center for Automotive Research at Stanford (CARS)
  • Ann Bordetsky, North America Market Development, Better Place
  • Dennis Bracy, cEO, US-China Clean Energy Forum
  • Curtis R. Carlson, President and CEO, SRI International
  • Jaching Chou, Senior Transportation Analyst, Institute of Transportation
  • Stephen J. Eglash, Executive Director, Energy and Environment Affiliates Program, Stanford University
  • Henry Etzkowitz, President of Triple Helix Association; Senior Researcher, Human Sciences and Technology Advanced Research Institute (H-STAR), Stanford University; Visiting Professor at University of Edinburgh Business School
  • Gordon Feller, Director of Urban Innovation, Cisco Systems
  • TJ Glauthier, President, TJG Energy Associates, LLC
  • Russell Hancock, President & Chief Executive Officer, Joint Venture: Silicon Valley Network
  • Ted Howes, Business for Social Responsibility
  • Asim Hussain, Director of Product Marketing, Bloom Energy
  • Paul Chao-Chia Huang, Deputy General Director, Service Systems Technology Center, Industrial Technology Research Institute, Taiwan
  • Kristina M. Johnson, Former Under Secretary of Energy, U.S. Department of Energy
  • Jeffrey Heller, President, Heller Manus Architects
  • Allan King, Senior Manager, Institute for Information Industry, Taiwan
  • Michael Marlaire, Director, NASA Research Park
  • David Nieh, General Manager, Shui On Land Limited
  • Jon Sandelin, Senior Associate Emeritus, Office of Technology and Licensing, Stanford University
  • Gerald Sanders, CEO & Chairman, SkyTran
  • Tim Schweikert, President & CEO, China Region for GE Technology Infrastructure, GE
  • Jonathan Thorpe, Senior Vice President, Gale International
  • Kung Wang, Professor, China University of Technology
  • Sean Wang, President, ITRI International Inc.
  • Jonathan Woetzel, Director, McKinsey & Co; Co-Chair, Urban China Initiative

Questions for presentations and discussion included:

  • What roles are public-private partnerships and other forms of collaboration playing to advance innovations in smart green industries, such as in the built environment or intelligent transportation?
  • What innovations - not only in technologies and products but also in processes, models and platforms - are leading the way?
  • What results are emerging from living labs, leading cities, or other outstanding examples of public-private partnerships around the world?
  • How do results stack up against economic, energy and social metrics, e.g. economic productivity, quality of life, energy impact, financial payback, user response, etc.?
  • What are implications for business strategies?
  • What government policies are effectively nurturing advancement in these areas?

Outcomes will include policy recommendations as well as highlights to be included in a book published by SPRIE at Stanford.

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Francis Fukuyama
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Over the course of three short months, popular uprisings have toppled regimes in Tunisia and Egypt, sparked a civil war in Libya and created unrest in other parts of the Middle East. They also have raised a question in many people's minds: Are all authoritarian regimes now threatened by this new democratic wave? In particular, is China, a rising superpower, vulnerable to these forces?  

The Communist government in Beijing is clearly worried. It has limited news coverage of the recent uprisings and has clamped down on democratic activists and foreign reporters, acting pre-emptively against anonymous calls on the Internet for China to have its own "Jasmine Revolution." A recent front-page editorial in the Beijing Daily, an organ of the city's party committee, declared that most people in the Middle East were unhappy with the protests in their countries, which were a "self-delusional ruckus" orchestrated by a small minority. For his part, President Hu Jintao has urged the strengthening of what has been dubbed the "Great Firewall"-the sophisticated apparatus of censorship and surveillance that the regime uses to control access to the Internet.

No social scientist or intelligence analyst predicted the specific timing or spread of the Arab uprising-the fact that it would start in Tunisia, of all places, that it would be triggered by an event like the self-immolation of a vegetable seller, or that protests would force the mighty Egyptian army to abandon Hosni Mubarak. Over the past generation, Arab societies have appeared stolidly stable. Why they suddenly exploded in 2011 is something that can be understood only in retrospect, if at all.

But this doesn't mean that we can't think about social revolutions in a more structured way. Even unpredictable things take place in a certain context, and the present-day situations of China and the Middle East are radically different. Most of the evidence suggests that China is pretty safe from the democratic wave sweeping other parts of the world-at least for now.

Perhaps the most relevant thinker for understanding the Middle East today and China tomorrow is the late Samuel Huntington-not the Huntington of "The Clash of Civilizations," who argued that there were fundamental incompatibilities between Islam and democracy, but the Huntington whose classic book "Political Order in Changing Societies," first published in 1968, laid out his theory of the development "gap."

Observing the high levels of political instability plaguing countries in the developing world during the 1950s and '60s, Mr. Huntington noted that increasing levels of economic and social development often led to coups, revolutions and military takeovers. This could be explained, he argued, by a gap between the newly mobilized, educated and economically empowered people and their existing political system-that is, between their hopes for political participation and institutions that gave them little or no voice. Attacks against the existing political order, he noted, are seldom driven by the poorest of the poor in such a society; they tend to be led, instead, by rising middle classes who are frustrated by the lack of political and economic opportunity.

All of these observations would seem to apply to Tunisia and Egypt. Both countries have made substantial social progress in recent decades. The Human Development Indices compiled by the United Nations (a composite measure of health, education and income) increased by 28% for Egypt and 30% for Tunisia between 1990 and 2010. The number of people going to school has grown substantially; Tunisia especially has produced large numbers of college graduates. And indeed, the protests in Tunisia and Egypt were led in the first instance by educated, tech-savvy middle-class young people, who expressed to anyone who would listen their frustrations with societies in which they were not allowed to express their views, hold leaders accountable for corruption and incompetence, or get a job without political connections.

Mr. Huntington stressed the destabilizing power of new social groups seeking political participation. People used to be mobilized by newspapers and radio; today they are spurred to action by cell phones, Facebook and Twitter, which allow them to share their grievances about the existing system and to learn about the possibilities of the larger world. This change in the Middle East has been incredibly rapid, and it has trumped, for now, old verities about the supposed passivity of Arab culture and the resistance of Islam to modernization.

But do these remarkable developments tell us anything about the possibility for future instability in China?

It is certainly true that the dry tinder of social discontent is just as present in China as in the Middle East. The incident that triggered the Tunisian uprising was the self-immolation of Mohamed Bouazizi, who had his vegetable cart repeatedly confiscated by the authorities and who was slapped and insulted by the police when he went to complain. This issue dogs all regimes that have neither the rule of law nor public accountability: The authorities routinely fail to respect the dignity of ordinary citizens and run roughshod over their rights. There is no culture in which this sort of behavior is not strongly resented.

This is a huge problem throughout China. A recent report from Jiao Tong University found that there were 72 "major" incidents of social unrest in China in 2010, up 20% over the previous year. Most outside observers would argue that this understates the real number of cases by perhaps a couple of orders of magnitude. Such incidents are hard to count because they often occur in rural areas where reporting is strictly controlled by the Chinese authorities.

The most typical case of outraged dignity in contemporary China is a local government that works in collusion with a private developer to take away the land of peasants or poor workers to make way for a glittery new project, or a company that dumps pollutants into a town's water supply and gets away with it because the local party boss stands to profit personally. Though corruption in China does not reach the predatory levels of certain African or Middle Eastern countries, it is nonetheless pervasive. People see and resent the privileged lives of the nation's elite and their children. The movie "Avatar" was a big hit in China in part because so many ordinary Chinese identified with the indigenous people it portrayed whose land was being stolen by a giant, faceless corporation.

There is, moreover, a huge and growing problem of inequality in China. The gains from China's remarkable growth have gone disproportionately to the country's coastal regions, leaving many rural areas far behind. China's Gini index-a standard measure of income inequality across a society-has increased to almost Latin American levels over the past generation. By comparison, Egypt and Tunisia have a much more equal income distribution.

According to Mr. Huntington, however, revolutions are made not by the poor but by upwardly mobile middle-class people who find their aspirations stymied, and there are lots of them in China. Depending on how you define it, China's middle class may outnumber the whole population of the United States. Like the middle-class people of Tunisia and Egypt, those in China have no opportunities for political participation. But unlike their Middle Eastern counterparts, they have benefited from a dramatically improving economy and a government that has focused like a laser beam on creating employment for exactly this group.

To the extent that we can gauge Chinese public opinion through surveys like Asia Barometer, a very large majority of Chinese feel that their lives have gotten better economically in recent years. A majority of Chinese also believe that democracy is the best form of government, but in a curious twist, they think that China is already democratic and profess to be satisfied with this state of affairs. This translates into a relatively low degree of support for any short-term transition to genuine liberal democracy.

Indeed, there is some reason to believe that the middle class in China may fear multiparty democracy in the short run, because it would unleash huge demands for redistribution precisely from those who have been left behind. Prosperous Chinese see the recent populist polarization of politics in Thailand as a warning of what democracy may bring.

The fact is that authoritarianism in China is of a far higher quality than in the Middle East. Though not formally accountable to its people through elections, the Chinese government keeps careful track of popular discontents and often responds through appeasement rather than repression. Beijing is forthright, for example, in acknowledging the country's growing income disparities and for the past few years has sought to mitigate the problem by shifting new investments to the poor interior of the country. When flagrant cases of corruption or abuse appear, like melamine-tainted baby formula or the shoddy school construction revealed by the Sichuan earthquake, the government holds local officials brutally accountable-sometimes by executing them.

Another notable feature of Chinese government is self-enforced leadership turnover. Arab leaders like Tunisia's Zine al-Abidine Ben Ali, Egypt's Mr. Mubarak and Libya's Col. Moammar Gadhafi never knew when to quit, hanging on 23, 30 and 41 years, respectively. Since Mao, the Chinese leadership has rigidly adhered to terms of about a decade. Mr. Hu, the current president, is scheduled to step down in 2012, when he is likely to be replaced by Vice President Xi Jinping. Leadership turnover means that there is more policy innovation, in sharp contrast to countries like Tunisia and Egypt, which have been stuck for decades in the rut of crony capitalism.

The Chinese government is also more clever and ruthless in its approach to repression. Sensing a clear threat, the authorities never let Western social media spread in the first place. Facebook and Twitter are banned, and content on websites and on China-based social media is screened by an army of censors. It is possible, of course, for word of government misdeeds to get out in the time between its first posting by a micro-blogger and its removal by a censor, but this cat-and-mouse game makes it hard for a unified social space to emerge.

A final critical way in which China's situation differs from that of the Middle East lies in the nature of its military. The fate of authoritarian regimes facing popular protests ultimately depends on the cohesiveness and loyalty of its military, police and intelligence organizations. The Tunisian army failed to back Mr. Ben Ali early on; after some waffling, the Egyptian army decided it would not fire on protesters and pushed Mr. Mubarak out of power.

In China, the People's Liberation Army is a huge and increasingly autonomous organization with strong economic interests that give it a stake in the status quo. As in the Tiananmen uprising in 1989, it has plenty of loyal units around the country that it could bring into Beijing or Shanghai, and they would not hesitate to fire on demonstrators. The PLA also regards itself as the custodian of Chinese nationalism. It has developed an alternative narrative of 20th-century history that places itself at the center of events like the defeat of Japan in the Pacific war and the rise of a modern China. It is very unlikely that the PLA would switch sides and support a democratic uprising.

The bottom line is that China will not catch the Middle Eastern contagion anytime soon. But it could easily face problems down the road. China has not experienced a major recession or economic setback since it set out on its course of economic reform in 1978. If the country's current property bubble bursts and tens of millions of people are thrown out of work, the government's legitimacy, which rests on its management of the economy, would be seriously undermined.

Moreover, Mr. Huntington's scenario of rising but unfulfilled expectations among the middle class may still play out. Though there is a labor shortage among low-skill workers in China today, there is a glut of the college educated. Every year into the future, China will graduate more than seven million people from its universities, up from fewer than a million in 1998, and many of them are struggling to find work suitable to their self-perceived status. Several million unemployed college graduates are far more dangerous to a modernizing regime than hundreds of millions of poor peasants.

There is also what the Chinese themselves call the "bad emperor" problem. China's historical achievement over the centuries has been the creation of high-quality centralized bureaucratic government. When authoritarian rulers are competent and reasonably responsible, things can go very well. Indeed, such decision-making is often more efficient than in a democracy. But there is no guarantee that the system will always produce good rulers, and in the absence of the rule of law and electoral checks on executive power, there is no way to get rid of a bad emperor. The last bad emperor, commonly (if quietly) acknowledged as such, was Mao. We can't know what future tyrant, or corrupt kleptocrat, may be waiting in the wings in China's future.

The truth is that, much as we might theorize about the causes of social revolution, human societies are far too complex, and change too rapidly, for any simple theory to provide a reliable guide. Any number of observers dismissed the power of the "Arab street" to bring about political change, based on their deep knowledge of the Middle East, and they were right every year-up until 2011.

The hardest thing for any political observer to predict is the moral element. All social revolutions are driven by intense anger over injured dignity, an anger that is sometimes crystallized by a single incident or image that mobilizes previously disorganized individuals and binds them into a community. We can quote statistics on education or job growth, or dig into our knowledge of a society's history and culture, and yet completely miss the way that social consciousness is swiftly evolving through a myriad of text messages, shared videos or simple conversations.

The central moral imponderable with regard to China is the middle class, which up to now has seemed content to trade political freedom for rising incomes and stability. But at some point this trade-off is likely to fail; the regime will find itself unable to deliver the goods, or the insult to the dignity of the Chinese people will become too great to tolerate. We shouldn't pretend that we can predict when this tipping point will occur, but its eventual arrival, as Samuel Huntington might have suggested, is bound up with the very logic of modernization itself.

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Shorenstein APARC
Stanford University
Encina Hall E317
Stanford, CA 94305-6055

(650) 725-2375 (650) 723-6530
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2011 Lee Kong Chian NUS-Stanford Distinguished Fellow on Southeast Asia
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Huang Jianli is an associate professor in the Department History at the National University of Singapore and a research associate at the university's East Asian Institute.

His first field of research interest is on the history of student political activism and local governance in Republican China from the 1910s to 1940s. His second area of study is on the postwar Chinese community in Singapore, especially its relationship vis-à-vis China and the larger Chinese diaspora. He has published a monograph on The Politics of Depoliticization in Republican China: Guomindang Policy towards Student Political Activism, 1927-1949 (1996, second edition 1999). A Chinese-language version of this monograph has just been published by the Commercial Press of Beijing in 2010. He has also co-authored a book on The Scripting of a National History: Singapore and Its Pasts (2008). In terms of edited volumes, he has co-edited Power and Identity in the Chinese World Order (2003) and Macro Perspectives and New Directions in the Studies of Chinese Overseas (2002).

He has articles in journals such as Modern Asian Studies, Journal of Oriental Studies, East Asian History, Journal of Southeast Asian Studies, South East Asian Research, Journal of the Malaysian Branch of the Royal Asiatic Society, Journal of Chinese Overseas, International Journal of Diasporic Chinese Studies and Frontiers of History in China. Some recent journal articles include "Umbilical Ties: The Framing of Overseas Chinese as the Mother of Revolution" (forthcoming, 2011), "Portable Histories in Mobile City Singapore: The (Lack)lustre of Admiral Zheng He" (2009), "Chinese Diasporic Culture and National Identity: The Taming of the Tiger Balm Gardens in Singapore" (2007), "Positioning the Student Political Activism of Singapore: Articulation, Contestation and Omission" (2006), "Entanglement of Business and Politics in the Chinese Diaspora: Interrogating the Wartime Patriotism of Aw Boon Haw" (2006) and "History and the Imaginaries of Big Singapore: Positioning the Sun Yat Sen Nanyang Memorial Hall" (2004).

His email contact is hishjl@nus.edu.sg and curriculum vitae is available at http://profile.nus.edu.sg/fass/hishjl

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David Lobell
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A team led by FSE fellow David Lobell has found a valuable, untapped resource in historical data from crop yield trials conducted across sub-Saharan Africa. Combined with weather records, they show that yield losses would occur across 65 percent of maize-growing areas from a temperature rise of a single degree Celsius, even with sufficient water. Data from yield tests in other regions of the world could help predict changes in crop yields from climate change.

A hidden trove of historical crop yield data from Africa shows that corn - long believed to tolerate hot temperatures - is a likely victim of global warming.

Stanford agricultural scientist David Lobell and researchers at the International Maize and Wheat Improvement Center (CIMMYT) report in the inaugural issue of Nature Climate Change next week that a clear negative effect of warming on maize - or corn - production was evident in experimental crop trial data conducted in Africa by the organization and its partners from 1999 to 2007.

Led by Lobell, the researchers combined data from 20,000 trials in sub-Saharan Africa with weather data recorded at stations scattered across the region. They found that a temperature rise of a single degree Celsius would cause yield losses for 65 percent of the present maize-growing region in Africa - provided the crops received the optimal amount of rainfall. Under drought conditions, the entire maize-growing region would suffer yield losses, with more than 75 percent of areas predicted to decline by at least 20 percent for 1 degree Celsius of warming.

"The pronounced effect of heat on maize was surprising because we assumed maize to be among the more heat-tolerant crops," said Marianne Banziger, co-author of the study and deputy director general for research at CIMMYT."

"Essentially, the longer a maize crop is exposed to temperatures above 30 C, or 86 F, the more the yield declines," she said. "The effect is even larger if drought and heat come together, which is expected to happen more frequently with climate change in Africa, Asia or Central America, and will pose an added challenge to meeting the increasing demand for staple crops on our planet."

Similar sources of information elsewhere in the developing world could improve crop forecasting for other vast regions where data has been lacking, according to Lobell, who is lead author of the paper describing the study.

"Projections of climate change impacts on food production have been hampered by not knowing exactly how crops fair when it gets hot," Lobell said. "This study helps to clear that issue up, at least for one important crop."

While the crop trials have been run for many years throughout Africa, to identify promising varieties for release to farmers, nobody had previously examined the weather at the trial sites and studied the effect of weather on the yields, said Lobell, who is an assistant professor of environmental earth system science and fellow at Stanford's Program on Food Security and the Environment.

"These trials were organized for completely different purposes than studying the effect of climate change on the crops," he said. "They had a much shorter term goal, which was to get the overall best-performing strains into the hands of farmers growing maize under a broad range of conditions."

The data recorded at the yield testing sites did not include weather information. Instead, the researchers used data gathered from weather stations all over sub-Saharan Africa. Although the stations were operated by different organizations, all data collection was organized by the World Meteorological Organization, so the methods used were consistent.

Lobell then took the available weather data and interpolated between recording stations to infer what the weather would have been like at the test sites. By merging the weather and crop data, the researchers could examine climate impacts.

"It was like sending two friends on a blind date - we weren't sure how it would go, but they really hit it off," Lobell said.

Previously, most research on climate change impacts on agriculture has had to rely on crop data from studies in the temperate regions of North America and Europe, which has been a problem.

"When you take a model that has been developed with data from one kind of environment, such as a temperate climate, and apply it to the rest of the world, there are lots of things that can go wrong" Lobell said, noting that much of the developing world lies in tropical or subtropical climates.

But he said many of the larger countries in the developing world, such as India, China and Brazil, which encompass a wide range of climates, are running yield testing programs that could be a source of comparable data. Private agribusiness companies are also increasingly doing crop testing in the tropics.

"We're hoping that with this clear demonstration of the value of this kind of data for assessing climate impacts on crops that others will either share or take a closer look themselves at their data for various crops," Lobell said.

"I think we may just be scratching the surface of what can be achieved by combining existing knowledge and data from the climate and agriculture communities. Hopefully this will help catalyze some more effort in this area."

Lobell is a Center Fellow at the Program on Food Security and the Environment, a joint program of Stanford's Woods Institute for the Environment and Freeman Spogli Institute for International Studies.

The work was funded by the Rockefeller Foundation

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Dr. Farrell earned a Ph.D. in Government from Georgetown University in 2000. He also holds a B.A. and M.A. in Politics from University College Dublin. Previously, he served as Assistant Professor at the University of Toronto, and was a senior research fellow at the Max Planck Institute on Common Goods in Bonn, Germany. He has taught courses on the political economy of European integration, the politics of the Internet, and the comparative political economy of Europe at the University of Toronto and Georgetown University.

Dr. Farrell's publications include: "Constructing the International Foundations of E-Commerce: The EU-US Safe Harbor Agreement," in International Organization, 57,2 (2003); "Trust, Distrust, and Power," in Distrust, ed. Russell Hardin (Russell Sage Foundation, forthcoming); and "Trust and Political Economy: Comparing the Effects of Institutions on Inter-Firm Cooperation," in Comparative Political Studies (forthcoming). Dr. Farrell is a member of the American Political Science Association, the International Society for the New Institutional Economics, the International Studies Association, and the European Union Studies Association

Graham Stuart Lounge

Henry Farrell Associate Professor of Political Science and International Affairs Speaker George Washington University
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Mohammad H. Fadel joined the Faculty of Law in January 2006. He received his B.A. in Government and Foreign Affairs (1988), a Ph.D. in Near Eastern Languages and Civilizations at the University of Chicago (1995) and his J.D. from the University of Virginia (1999). While at the University of Virginia School of Law, Professor Fadel was a John M. Olin Law and Economics Scholar and Articles Development Editor of the Virginia Law Review.

Prior to law school, Professor Fadel completed his Ph.D in Chicago, where he wrote his dissertation on legal process in medieval Islamic law. Professor Fadel was admitted to the Bar of New York in 2000 and practiced law with the firm of Sullivan & Cromwell LLP in New York, New York, where he worked on a wide variety of corporate finance transactions and securities-related regulatory investigations. In addition, Professor Fadel served as a law clerk to the Honorable Paul V. Niemeyer of the United States Court of Appeals for the 4th Circuit and the Honorable Anthony A. Alaimo of the United States District Court for the Southern District of Georgia. Professor Fadel has published numerous articles in Islamic legal history.

Graham Stuart Lounge

Mohammad Fadel Professor of Law Speaker University of Toronto
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Ruth Grant is Professor of Political Science and Philosophy and Senior Fellow in the Kenan Institute for Ethics at Duke University. She specializes in political theory with a particular interest in early modern philosophy and political ethics. She is the author of John Locke's Liberalism and Hypocrisy and Integrity: Machiavelli, Rousseau and the Ethics of Politics. Her articles have appeared in a variety of journals with audiences in several fields, including political science, medicine, law, education, economics, and philosophy. She has received fellowship awards from the National Endowment for the Humanities, the American Council of Learned Societies, and the National Humanities Center. She earned a bachelor's degree in political science and a doctorate degree in political science from the University of Chicago. She is currently working on a project on ethics and incentives and leading a collaborative project exploring goodness.

Graham Stuart Lounge

Ruth Grant Senior Fellow, Kenan Institute for Ethics Speaker Duke University
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Go out there and change the world.
- Tim Draper, Draper Fisher Jurvetson

"Whatever the world looks like now, it will change," said Tim Draper, founder and managing director of Draper Fisher Jurvetson (DFJ), during the keynote session at the March 1 Entrepreneurship in the Global Marketplace seminar, organized by the Stanford Program on Regions of Innovation and Entrepreneurship (SPRIE) with sponsorship from Alibaba.com, the first in a series of seminars by the Schwarzenegger Emerging Entrepreneur Initiative. Concluding his remarks, Draper urged the overflow audience: "Go out there and change the world."

Draper and the nine other participants shared different perspectives on entrepreneurship, but a key message underlying all of the presentations was that the world is a dynamic, rapidly changing place where entrepreneurs can succeed by anticipating and responding to global trends. In doing so, many suggested, it is also possible to change the world—for the better. The participants all concurred that China is one of the key places in the world—now and in the future—to do business, representing a challenging but a vast frontier of opportunity.

Global demographic trends are a major factor that venture capitalists consider when making investments. Addressing the worldwide aging phenomenon, which is particularly acute in Asia-Pacific countries such as Japan and China, Draper explained how DFJ has invested in a company that manufactures videogame-like devices designed to improve cognition, noting the growing market for such devices that help keep cognitive health apace with a longer life span. Hans Tung, a partner with the Shanghai-based venture capital firm Qiming Ventures, described how his firm is tracking the large segment of China's population living in small cities away from commercial hubs. These members of the populace, who prefer to shop online where they can find a wider selection of goods than in their local shopping malls, are quickly becoming a driving force in China's e-commerce market.

It is China's e-commerce and other Internet firms—fueled by the explosion of Internet users—that carry increasingly significant weight in China's domestic and the global economy. 
Duncan Clark, a visiting scholar at SPRIE, presented related findings from SPRIE's China 2.0: The Rise of a Digital Superpower research initiative, which is led by Marguerite Gong Hancock, associate director of SPRIE. China 2.0, explores the conditions generating such rapid growth of the Internet, and investigates questions surrounding the possible global implications of it. Clark noted that as China's three largest Internet firms—search engine Baidu, instant-messaging service Tencent, and e-commerce portal Taobao—expand, domestic competition will not only intensify, but move further into the global economic arena. The "big three" firms are already ranked among the top 20 Internet sites in the world based on site traffic. According to Clark, the key question in the future for U.S. companies will be how to partner with Chinese companies in order to insure their own growth.

Riding the global wave of innovation and entrepreneurship, Jonathan Ross Shriftman, co-founder of Solé Bicycle Company, and Ryder Fyrwald, vice president of global operations at the Kairos Society, have discovered opportunities to effect positive change despite a global climate of intense economic competition. Shriftman, a recent University of Southern California (USC) graduate, described the lessons that he has learned through his company's quest to manufacture low-cost, quality fixed-gear bicycles that provide a stylish, alternate form of transportation. Despite funding and language challenges, Shriftman and his partner succeeded in connecting with a manufacturer in China through Alibaba.com, and have sold nearly 800 bicycles to date. Fyrwald, who is still an undergraduate at USC's Marshall School of Business, explained the philosophy behind the Kairos Society, an international network of student entrepreneurs who seek to solve world issues through entrepreneurship and innovation. He cited the example of WaterWalla, a company that has developed, among other technologies, a low-cost water purification device for use by urban slum dwellers.

From the perspective of seasoned venture capitalists Draper and Tung and emerging entrepreneurs Shriftman and Fyrwald, the message at Entrepreneurship in the Global Marketplace was clear: the way to succeed in a rapidly changing world is to react promptly—and creatively—to global trends. And, as Shriftman suggested, it is possible to "do well by doing good," and change the world in a positive way.

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Ryder Fyrwald (left), vice president of global operations at the Kairos Society, and Jonathan Ross Shriftman, co-founder of Sole Bicycle Company.
Courtesy Alibaba.com
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