The Prosperity Paradox
Focusing on innovation to dig a country out of poverty
The authors of The Prosperity Paradox explore and reveal the paradox of most of the interventions that have been carried out to end poverty in the third world. The book explains that many of the solutions used and millions of dollars spent on charity to help many third world countries out of poverty have not produced results and that they have sometimes even made countries poorer, left with redundant infrastructures for which they have to bear the financial burden. The authors suggest that the best way forward to overcome poverty is through the right type of innovation, which brings about the creation of new companies and markets that in turn promote the development of the country in which they operate. Using examples of countries such as America, South Korea and Japan, and cases in which some of their respective companies have played a role in their development, the authors present a system of economic development based on innovation which enables a country to dig itself out of poverty.
Many useful tips to:
- Look at ways to free the world from poverty and better understand the mechanisms of prosperity.
- Learn to see opportunities where most of the world would see unfertile ground.
- Truly learn what poverty is, what prosperity is and how to free countries from the former by guiding them towards the latter.
The prosperity paradox and investment in new markets
It really is possible to define a path which can break down poverty, but first of all it is necessary to understand what creates it and then to begin to think differently. The charity initiatives aimed at reducing the most evident signs of poverty (defined as push strategies), such as the building of wells in areas without water or of roads to improve transport, do not create long term prosperity because they are often types of infrastructure that are not yet needed and not sustainable in the current markets of a given country. Prosperity is a relatively recent phenomenon for many countries (such as China or South Korea), and by prosperity we mean the process through which more and more people in an area reach a higher level of social, political and economic well-being. Some countries can be considered rich because, for example, they have many primary resources, but they are not prosperous because prosperity is generated by an increase in social, political and economic freedom and so it doesn’t only depend on the resources available in a country. And this is the prosperity paradox: research in most countries has shown that long term prosperity is not achieved by reducing poverty, but by investing in innovations that create new markets (destructive innovation). These innovations work as catalysts to kick start sustainable economic development.
The key ideas of "The Prosperity Paradox"
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