Showing posts with label Economics. Show all posts
Showing posts with label Economics. Show all posts

Thursday, April 21, 2011

Malcolm Gladwell's The Tipping Point

Ever since my undergraduate studies, I’ve been extremely interested in the application of economics. Taking the suggestion of my Globalization professor in my MBA program, I decided to pick up Malcolm Gladwell’s 2000 book, The Tipping Point.

Don’t be scurred of the book simply because I started off with my declaration of love for economics – you don’t have to be an economist or even think like one to understand Gladwell. He writes more about everyday events from a sociologist perspective as opposed to an economist perspective. So fear not.

As taken from Wikipedia, The Tipping Point can be loosely defined as "the moment of critical mass, the threshold, the boiling point." And Gladwell takes events such as the syphilis outbreak in Baltimore in the mid-1990s or the drop in New York City’s crime-rate or the resurgence of Hush Puppies popularity and describes how each event reached a point where an epidemic broke loose. Each event has some sort of, dare I say, tipping point that keeps all metaphorical hell from breaking loose. Once you reach that point, syphilis outbreaks or crime drops or hipsters aren’t the only ones wearing Hush Puppies anymore.

When change as such happens – it happens fast. To apply an economic principle, as Gladwell does, 80% of the work is accomplished by 20% of the people. Examples he provides are 80% of beer is consumed by 20% of beer drinkers, 80% of car accidents are because of 20% of drivers, so on and so forth. A small few wear Hush Puppies, a small few practice unsafe sex in combination with other things to pass on syphilis, a small few decide to straighten up and fly right in New York – and an epidemic breaks loose once it reaches a certain boiling point.

Want to know more about the Stickiness Factor as practiced by Sesame Street or Blue’s Clues? The Power of Context in Divine Secrets of the Ya Ya Sisterhood? Check out the book if for no other reason than to sound smart to your friends.

Friday, February 18, 2011

The Travels of a T-Shirt in the Global Economy

The Travels of a T-Shirt in the Global Economy . . . how can 336 pages about the microeconomic look at how a t-shirt is made (from the beginnings of the US cotton industry to the cotton mills of yesteryear to sweatshops in Asia) and how the history of t-shirt production can be a good way of looking at globalization and the effects of free trade NOT be awesome.

Yes, markets and percentages of GDP and currency fluctuation and Cold War vs Globalization can be confusing if you’re not an MBA student (or hell, sometimes even if you are), but Pietra Rivoli does a pretty decent job offering a narrative that most anyone can understand what she’s talking about.

The big question is – even if you get what she’s talking about, will you find it interesting? Good question. The book starts off a little slow with a specific, detailed, micro look at the cotton industry and its origins in the United States, but really does make you sit back and think about where the t-shirt on your back came from. Whose sweat is responsible for that? Why did the US dominate the cotton industry? Some truths are tragic, others make you realize how great our country has become.

Cotton subsidies, yeah they screw over poor farmers in Africa who don’t have US subsidies and university resources, but at the same time, these poor African countries have their countries working against them (rather than for them as in the US). Sure the US cotton industry came about because of free labor in the form of slavery, but look at what’s it’s developed into and the people its helped.

The poor conditions of US cotton mills matched the poor conditions of British cotton mills decades before and holds a surprising resemblance to cotton mills in Asia at the moment. Are these Asian cotton mills entirely horrible if they eventually lead to skill enhancement and better lives (in the long run) for its people? In Britain and the US, cotton mills led to child labor laws and fair employment laws – whose to say that what led to the independence and well-being of so many people won’t lead to the same for their present-day counterparts?


The author does a great job of remaining impartial – instead of telling the reader that Chinese sweatshops are horrible or that using slavery to advance the cotton industry is bad bad bad – she lets you draw your own conclusion. These things are bad on a humane level, but they led/can lead to greater things.