I think the words “developing countries” or “third-world countries” are misnomers.
It’s not because their economies are big enough or stable enough to compare to economies of nations like the US, South Korea, Japan, or Germany – they’re not. Developing economies are often far smaller in sheer size, dominated by manual, unskilled labor, and far more vulnerable. But despite the shortcomings of economies in nations like India or South Sudan, I don’t like the term “developing economies” because it ignores an important detail about the economies and societies it describes.
Developing worlds have a critical ingredient important to global progress that developed nations can’t provide: uncertainty, and the breadth of potential that comes with it*.
Let me show you want I mean with a more personal example.
Being on the verge of finishing high school this year, I’ve been lead to think for hours on end about my future. What kind of a career would I choose? When do I want a family? Where do I want to live and study for the next few years? These questions riddle my mind because of the necessary uncertainty that comes with being young and unsettled. There’s a wide variety of options in front of me, and because I can’t predict the future, I have the ability to choose any of them, and watch the future unfold. Because I don’t know the future, I can take a risk in the dangerous and rewarding act of making a decision.
My parents, on the other hand, are not so fortunate today. Of course, they’ve had their share of choices to make and futures to discover. But today, they’ve chosen their paths, they’ve built their families and relations, and they’ve grown out their lives to be stable and supportive of what they want to do. However, they’re without the array of options that I have today.
The contrast between developing and already industrialized societies are, in a broad sense, similar. While industries in the US or Germany, for example, are large-scale, mature, and therefore stable, the smaller-scale, younger businesses that are more commonplace in developing worlds are more agile and fast to change and adapt to innovation. And here’s the important point: because of the agility and smaller scale of economies and businesses in the developing nations, for the next century, they will be the backdrop for the next wave of social and technological innovation**.
Right now, the world is stuck at a bit of a unique situation. In the past, there was almost always a large gap in potential and the resources available to entrepreneurs in the developed worlds, as compared to those in the developing worlds. But as more people gain access to internet and faster, cheaper access to resources, both in better information and in faster, cheaper shipping, that gap is poised to close quicker than it’s been possible. In a sense, developing worlds’ small businesses and entrepreneurs are able to absorb the innovation and knowledge already out there online, and “catch up” to the innovation that’s pushed the developed worlds forward.
But not only do they have access to new resources, businesses there are also subject to more economic risk than, say, a new founder in South Korea. And in an environment where new availability of technological innovation is in confrontation with economic risks in starting a business in developing worlds, more people are likely to take more novel, risky investments that sometimes lead to breakthroughs.
In short, the accelerating growth of businesses in developing nations, combined with the wider market that expanding global trade opens up to firms in already developed nations, means that these rising, developing economies are an absolutely essential factor in global economic growth for the coming decades. Never before has such a potent market also been so well connected to the resources and supply they can absorb, and the impact of that change is emerging.
Economic potential isn’t the only common trait of developing worlds, however. In many of these nations, deep social issues like poverty, social conflict, segregation, disenfranchisement, and corruption, not to mention ongoing wars in many of them, are also factors in how these nations can (or cannot) grow.
Fortunately, I think the factors that are accelerating economic growth are also capable of remedying many of these issues. The same connectivity that allows a local entrepreneur in Latin America to learn English or start a business can also help refugees get the education they want or the money they need to survive. These same technologies are spreading the news of problems in many parts of the world, bringing the voices of the disenfranchised to the people who can help and support them, and rally behind them as their voice to those willing to listen.
But the solutions to these social issues that will make developing worlds better, and hence improve the world for everyone, can’t be found without the help of those in better places. You, and me, and the people in comfortable positions in the developed worlds have to care about those people*** in less privileged parts of the world, not as statistics to optimize or as stories on the news, but as a part of a global community, as people whose lives and events affect us on the other side of the world. Because they do.
In a world where an eager student in Syria and a science teacher in Palo Alto are connected by milliseconds, where news of an earthquake in Chile hit the Canadian news feed in a few minutes, where the success of businesses and communities halfway across the globe have concrete impacts on our local communities, in global issues, there is no “us” and “them”; there are only facets of Us. And we should care about the problems facing the world as if they are ours, because whether they’re in a street corner in San Francisco or in the refugee camps of Greece, we can’t ever, and we won’t ever, be two separate worlds.
* Disclaimer: I’m not an economist. I’m making an educated argument for considering the developing worlds as a part of a global economy that we ought to care about just as much as the developed worlds, and I’ve chosen to incorporate some economic arguments here, so if you are an expert, feel free to corroborate or disprove my claims in the comments.
** This short brief describes well the potential of what they call the “economic catch-up” of the developing countries, which is the background for the stance I take here.
*** Or, as Alexis Ohanian would say, “give a damn.”
I share new posts on my newsletter. If you liked this one, you should consider joining the list.
Have a comment or response? You can email me.