Travels in the Riel World

Richard Florida wrote an interesting article a while back in which he suggested that government policy makers would be wise to forge new ideas based on the economic and innovation potential of so-called mega-regions around the world. Much more so than countries or cities, he contends, mega-regions are actually the prime drivers of the global economy.

While there are 191 nations in the world, just 40 significant mega-regions power the global economy. Home to more than one-fifth of the world’s population, these 40 megas account for two-thirds of global economic output and more than 85% of all global innovation.

The world’s largest mega is Greater Tokyo, with 55 million people and $2.5 trillion in economic activity. Next is the 500-mile Boston-Washington corridor, with some 54 million people and $2.2 trillion in output…

Mega-regions are the true force driving the rise of emerging economies. Some 40% of Brazil’s total economy is made up of a corridor stretching from Rio to São Paolo. Russia is propelled by the Moscow mega. India’s economy is shaped by the mega-regions of Bangalore and Mumbai.

China is not our real competitor. Rather, we should be thinking about the great mega-regions around Shanghai, Beijing and the Hong Kong-Shenzhen corridor, which account for roughly 43% of the output of the entire country.

Florida discusses several ways in which governments can support the innovation that arises from mega-regions, from promoting free trade to developing urban policies meant to improve infrastructure and facilitate “greater cross-border flows of goods and people.” It’s a thought-provoking piece that is worth a look.

Newsweek currently has an interesting little article about the world’s happiest nations. It cites statistics from the World Database of Happiness, which is the product of several years of research into life satisfaction issues around the globe. The survey ranks the countries with the happiest and least-happy people and makes an interesting conclusion:

The golden rule of economics is that well-being is a simple function of income. That’s why nations strive for a higher and higher GDP; it’s also a key reason why people struggle to make more money - income gives us choice and a measure of freedom.

But over the past decade or so, there’s been growing evidence that wealth isn’t as important as once thought. Studies show that beyond a certain income, more money doesn’t lead to any permanent increase in happiness.

But what are the happiest nations in the world? The people of Denmark lead the way, followed by Switzerland, Austria, Iceland and Finland. The United States is ranked 17th.

In another example of the interconnectedness of the globe, an increased demand for corn-based ethanol fuel is now being pegged as a culprit behind a tortilla crisis in Mexico.

Mexico is in the grip of the worst tortilla crisis in its modern history. Dramatically rising international corn prices, spurred by demand for the grain-based fuel ethanol, have led to expensive tortillas. …

The typical Mexican family of four consumes about one kilo — 2.2 pounds — of tortillas each day. In some areas of Mexico, the price per kilo has risen from 63 cents a year ago to between $1.36 and $1.81 earlier this month.  With a minimum wage of $4.60 a day, Mexican families with one wage earner have been faced in recent months with the choice of having to spend as much as a third of their income on tortillas — or eating less or switching to cheaper alternatives.

There are many angles to this story, from market economics to global energy needs, which you can explore in a multitude of related stories.  But the focus here is on culture and there are some good descriptive nuggets about Mexican culture in the article:

In another place, a rise in the cost of a single food product might not set off a tidal wave of discontent. But Mexico is different.  “When you talk about Mexico, when you talk about culture and societal roots, when you talk about the economy, you talk about the tortilla,” said Lorenzo Mejía, president of a tortilla makers trade group. “Everything revolves around the tortilla.”

The ancient Mayans believed they were created by gods who mixed their blood with ground corn. They called themselves “Children of the Corn,” a phrase Mexicans still sometimes use to describe themselves.

Poor Mexicans get more than 40 percent of their protein from tortillas, according to Amanda Gálvez, a nutrition expert at the National Autonomous University of Mexico. Modern-day tortilla makers such as Rosales use “an ancient and absolutely wise” Mayan process called “nixtamalizacion,” Gálvez said.

The process is straightforward. Large kernels of white corn are mixed with powdered calcium and boiled, then ground into a dough with wheels made of volcanic rock.  The resulting tortillas are more pliable and more durable than those typically found in U.S. stores. Mexicans say tortillas are their “spoons” because they use them to scoop up beans, and can serve also as their “plates” because they’re sturdy enough to hold a pile of braised meat and vegetables.

The tortilla-making process, Gálvez said, releases antioxidants and niacin, which allows them to be absorbed by the body, and the membranes on each corn kernel provide important dietary fiber. As a result of eating tortillas, Mexican children have a very low incidence of rickets, a bone disease caused by calcium deficiency that is common in developing countries.

“It is absolutely crucial for our population to keep eating tortillas,” Gálvez said.

Something to think about the next time you munch on a tortilla at a Mexican restaurant.

With all the focus on economic growth and development in the world, it’s interesting to read about a country that may actually be trying to pull back the reins on growth in favor of a more balanced approach.  That, at least, is the story out of Thailand these days, according to this recent article in Newsweek International.

Surayud Chulanont, Thailand’s interim prime minister … has introduced measures to halt the Westernization of Thai society, downsize the role foreigners play in the economy and maximize “happiness,” not growth, as he put it. Surayud’s blueprint draws inspiration from the country’s highest authority: 79-year-old King Bhumibol Adulyadej, the world’s longest-reigning monarch. His Highness has long advocated “sufficiency” in Thai life, meaning humility, simplicity and living within one’s means. Others have a different name for it: “Buddhist economics.” …

Since the late 1990s, a small group of retired officers, bureaucrats and economists have worked to codify the king’s ideas into a unified economic theory … They say it represents a “middle path” between excessive globalization and inwardness, between unbridled capitalism and the welfare state, and between “backwardness and impossible dreams,” as the UNDP report puts it.

One main aim is to mitigate “the inevitable boom-bust cycles” that haunt many developing economies, says Wisarn Pupphavesta, a senior economist at the Thailand Development Research Institute. “I accept that it goes against neoliberal consumer capitalism,” says an economist with close ties to the monarchy. “But we must choose a new way of life.”

Some businesspeople and foreign investors are not impressed and charge that the new policies are slowing the economy, derailing the stock market and guaranteeing a permanent rural underclass.  It’s all certainly food for thought. At the very least it has led to the coining of an interesting new term in “Buddhist economics.”

Anyone who likes to argue that Islam cannot exist in conjunction with either capitalism or democracy needs to take a closer look at Turkey.  Not only does the country have a functioning democracy, but the region of central Turkey is fast developing into much more than an agricultural economy, as noted by this recent article in the International Herald Tribune.

Many Europeans and secular Turks alike have long dismissed this poor, largely agricultural region as the “other” Turkey, a decidedly non-European backwater where you are more likely to see women in head scarves than businessmen in pinstripes. Islam, they argue, never underwent its own Reformation and so is not receptive to capitalism and innovation.

Yet Kayseri and surrounding towns like Hacilar have produced so many successful Muslim entrepreneurs that the area has earned the title of “Anatolian tiger.” … The region’s mix of Muslim values, hard work and raging capitalism has even prompted sociologists to coin a new term to describe the phenomenon: “Calvinist Islam.”

As Turkey seeks to join the European Union amid growing skepticism in Europe about the prospect of integrating a large agrarian Muslim country into one of the world’s biggest trading blocs, the case of Kayseri shows that Islam, capitalism and globalization can be compatible.

Central Anatolia is profiting from its mix of religion and business because of what local Muslim entrepreneurs refer to without irony as their “Protestant work ethic” - a willingness to work long hours, a commitment to combine religious conservatism with democracy and a pro-business bias within Turkish Islam.