Few would dispute China’s importance to the world economy today; from small villages to large cities, its presence is now felt almost everywhere. The Economist recently went so far as to call China “the indispensable economy,” reporting that more and more multinational companies are realizing an increased share of their revenues from inside Chinese borders.
A concerted effort is being made by institutions like the World Bank to quantify various types of transaction costs incurred by businesses (Doing Business, Enterprise Surveys). The rationale for focusing on transaction costs (and reducing them) is usually couched in mainstream economic concerns. That is, in an attempt to increase growth rate of GDP per capita, create jobs, reduce poverty, and so on.
In an article last month in the Boston Review, Kentaro Toyama, a former computer scientist for Microsoft turned ICT4D promoter, confronts the limits of technological solutions to development problems:
Most of the attention on governance in developing countries is on developing efficient rules and regulations. That is, given the social and economic priorities of a country, rules and regulations should work towards achieving priorities in the least costly way. However, another dimension of governance that must be discussed is accessibility of government officials to the public. Arguably, better access would increase transparency and help citizens and businesses voice their ideas and concerns, thereby allowing for more effective implementation of laws.
For all of us working towards providing a better business and regulatory environment, it is important to know whether economic analysis has improved the quality of regulatory decisions. A proper analysis of the costs and benefits associated with regulations (government rules that govern private activity) is critical in determining which regulations to administer and in what capacity.
OK, the title is deliberatively provocative. But I found a coincidence of two blog posts last week to be quite powerful. Last week we had a blog post from Dave Snowden that challenged the "data to information, information to knowledge and wisdom" continuum that has informed so many of the knowledge management efforts in the non-profit and public sector: