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Corporate Mortality and the Culture of Failure

May 26, 2015
Sizes of some 30,000 companies traded publicly on US markets from 1950-2009, measured by their sales (controlling for inflation and GDP growth). The relatively rapid growth of smaller companies near the beginnings of their lifespans account for the ragged lower portion of the chart, as well as the relatively steep initial sales increases. As companies reach maturity, their sales tend to level off. Credit: Marcus Hamilton and Madeleine Daepp

Sizes of some 30,000 companies traded publicly on US markets from 1950-2009, measured by their sales (controlling for inflation and GDP growth). The relatively rapid growth of smaller companies near the beginnings of their lifespans account for the ragged lower portion of the chart, as well as the relatively steep initial sales increases. As companies reach maturity, their sales tend to level off.
Credit: Marcus Hamilton and Madeleine Daepp

What about failure?

When I was writing my article on entrepreneurship in Egypt (Peterson 2010), which I heavily cannibalized for Chapter Six of Connected in Cairo, one of the things in which I was particularly interested in was failure.

One of my key points was that when US companies fail at home, that’s just business. But when they fail while doing business in Egypt or comment on the failures of Egyptian entrepreneurs–and I suspect this holds in many countries–they blame it on the local “culture.” Egyptian business failure is blamed on a supposed poor work ethic, on institutions like wasta, and on a presumed “lack of entrepreneurial imagination.”

When I sought to contextualize the discourse of these businessmen with some general statistical data, I was shocked to find almost nothing on business failures.

Obviously all businesses dies sometime, and every entrepreneurial adventure is by definition a risk, yet there was not only no theoretical literature on entreprenuerial failure, there were no statistics. And none on business failures generally.

Well now there is (thanks in part to another anthropologist). It turns out the average publicly traded company in the US lasts only ten years.

The Life Span of Companies

EveLifespann more interesting, the interdisciplinary team of two physicists, an anthropologist and an economist at the Santa Fe Institute in New Mexico discovered that companies die off at roughly the same rate regardless of size, what kinds of products or services they produce, how long they have been in business, or how well-established they are.

This finding runs counter to the few theories that exist in business literature, which either assume that newer, less established companies are more vulnerable, or that more established, less flexible companies are more vulnerable.

Causes of death include:

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Call For Papers: Ten years after – The Muhammad Cartoons

May 3, 2015
In September I will be one of the keynote speakers at a conference in Copenhagen on the Muhammad Cartoon Controversy. I hope some of those following this blog will be able to join us.

In September I will be one of the keynote speakers at a conference in Aalborg, Denmark on the Muhammad Cartoon Controversy. We’re looking for people to join us.

Call for papers: Ten Years After-The Muhammad Cartoon Controversy – Perspectives, Reflections and Challenges

Aalborg, September 28-29, 2015

Ten years have gone since the Danish newspaper Morgenavisen Jyllands-Posten decided to publish 12 Muhammad cartoons of the prophet Muhammad as cartoonists ‘imagined him’.

The cartoons and the stories about them led to violence that cost the lives of 150 people. Denmark’s reputation abroad and export to Arab speaking countries were severely impacted.

In addition, the publication of the cartoons and the events following have affected the opportunities of immigrants, who experience being stigmatized and not fully allowed to be Danes. Many Danes have had their ideas of womanhood among Muslims re-enforced, ideas of incompatible values have been strengthened, and the debate about freedom of speech reified.

For many non-Western Muslims, the cartoon story has become an icon of Western arrogance and hatred towards Islam. Their anger came from a deep sense that they are not respected, that they and their most cherished feelings are “fair game.”

New research suggest that increased racial discrimination and enforcement of racial-cultural logics of belonging facilitates mobilization of minority youth groups to crime, violence, political activism, carelessness and terrorism. This development exposes a “schismogenetic” process that merits academic attention analysis and solutions.

Some of the questions for the conference:

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“From Arab Spring to Arab Winter”: Special Journal Issue

April 26, 2015
Why didn't the 2011 uprisings lead to democratization? That's the question posed by articles in a political science journal. Photo Credit: tolkien1914 via Compfight cc

Why didn’t the 2011 uprisings lead to democratization? That’s the question posed by articles in a special issue of the journal Democratization. Photo Credit: tolkien1914 via Compfight cc

“From Arab Spring to Arab Winter” is the title of a special issue of the journal Democratization. Edited by Raymond Hinnebusch, an amazingly prolific international relations professor at the University of St. Andrews, it seeks to examine why democratization has largely failed in the wake of the prodemocratic uprisings, and what patterns can be elicited from the similarities and differences in outcomes from the many Arab Spring protests.

None of the articles focus exclusively on Egypt, but many refer to her in some detail, or make points especially relevant to Egypt’s situation.

This is very much Hinnebusch’s project: he offers an extraordinary synthetic model for looking at the post-uprising phases of the Arab Spring in his introduction, writes an essay comparing Tunisia, Egypt and Syria, and writes an extensive conclusion. Some of the authors are or were his students.

Here are the papers that touch on Egypt:

Hinnebusch, Raymond. 2015. Introduction: understanding the consequences of the Arab uprisings – starting points and divergent trajectories. Democratization 22(2): 205-217.

Abstract:

This introduction sets the context for the following articles by first conceptualizing the divergent post-uprising trajectories taken by varying states: these are distinguished first by whether state capacity collapses or persists, and if it persists, whether the outcome is a hybrid regime or polyarchy. It then assesses how far starting points – the features of the regime and of the uprising – explain these pathways. Specifically, the varying levels of anti-regime mobilization, explained by factors such as levels of grievances, patterns of cleavages, and opportunity structure, determine whether rulers are quickly removed or stalemate sets in. Additionally, the ability of regime and opposition softliners to reach a transition pact greatly shapes democratic prospects. But, also important is the capacity – coercive and co-optative – of the authoritarian rulers to resist, itself a function of factors such as the balance between the patrimonial and bureaucratic features of neo-patrimonial regimes.

This paper is available free on-line.

Read more…

Whatever Happened to Democratization in Egypt?

April 25, 2015
"Pathways of Post-Uprising States" according to Ray Hinnebusch's article in the most recent issue of the journal Democratization.

“Pathways of Post-Uprising States” according to Ray Hinnebusch’s article in the most recent issue of the journal Democratization.

Democratization theory–a continually developing effort to understand the stages of transformation of nondemocratic states to democracy–has not proved successful in analyzing Egypt’s political revolution because Egypt has certainly not become a democracy, nor is it clearly in any of the stages typically predicted by this theory.

On the other hand, writes Ray Hinnebusch in the most recent issue of the journal Democratization, neither has there been a uniform restoration of authoritarianism, as would be predicted by what he calls “postdemocracy theory.”

Instead, he states, in his article “Introduction: understanding the consequences of the Arab uprisings – starting points and divergent trajectories,” Hinnebusch argues that following the Arab Spring we find either state collapse–which leads to what he calls “competitive state making,” or state persistence, which leads either to “hybrid regimes” or “polyarchies.”

By state collapse, of course, he means states like Syria, Yemen and Libya, in which democratic uprisings so weakened the state that it collapsed or nearly collapsed, and “democratic prospects appear to be foreclosed for the near future.”

Competitive regime making occurs in collapsed states as Islamic groups, charismatic (and patrimonial) leaders, and the “remnants of bureaucratic state institutions vie to create order out of chaos.

States that do not collapse (like Egypt), Hinnebusch writes, fall into one of two other conditions:

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Whither Media in Egypt?

March 9, 2015
The latest issue of Arab media & Society offers five essays on the future of Egyptian media--and it's not very bright.

The latest issue of Arab media & Society offers five essays on the future of Egyptian media–and it doesn’t look very bright.

The latest issue of the on-line journal Arab Media and Society, published by the Kamal Adham Center for Television and Digital Journalism at the American University in Cairo, has a slew of essays (five of six) on media in Egypt.

One is analytical–a look at international press coverage of Morsi’s ouster. The other four are essays offering bleak and bleaker outlooks on the future of Egyptian media.

The mildest is an account of the failure of Egypt to keep up with translation technology in the modern era. The bleakest sees all media in the Arab world as essentially under the control of the power and money elites–the digital dream is dead.

Here’s a quick round-up:

Read more…

News, Truth and Verification in Egypt and the US

February 20, 2015
Answering questions after my talk Jan. 29 at the University of Cincinnati, I got onto the topic of truth, culture,  and  verification.

Answering questions after my talk Jan. 29 at the University of Cincinnati, I got onto the topic of truth, culture, and verification. Photo: Madison Schultz.

As more and more people get their news from digital media, including social media, many question the reliability of these new sources of news, as opposed to newspapers and television news. Are truth and verifiability disappearing from the news and, if so, does it matter?

I addressed this during a public lecture recently at the University of Cincinnati entitled “Toward an Anthropology of New Media.”

I suggested that there were at least five crucial problems facing scholarship on new media, and described what I saw as anthropology’s contributions to dealing with these problems.

During the Question and Answer period after the talk, an archaeology colleague asked me about whether one of the biggest problems with new media wasn’t the inability of news consumers to verify, and thus rely on, the news they read in their myriad on-line sources.

I responded:

First, there is very little evidence that people ever verify the news. Rather, they tend to decide whether or not the news is true and reliable, based on

  1. Their relationship to the news source (whether the news is expressed in language they find reassuring, whether or not it is one they visit frequently, how long they have received their news from that source, etc.), and
  2. The degree to which the news agrees with what they already know (i.e. believe) to be true.

Read more…

How Social Media Networked The Egyptian Revolution

February 7, 2015

Faris PostCould Egypt’s experience of Internet activism leading to revolution serve as a model for social movements everywhere?

That seems to be one of the take-aways of David Faris’s book Dissent and Revolution in a Digital Age: Social Media, Blogging and Activism in Egypt which offers a detailed case study of Egyptian media activism from 2005 to 2011, and draws from it a general model for what works and what doesn’t.

While the author argues for the importance of local contexts and situations in setting the stage for digitally mediated resistance to the Egyptian regime, he also makes much larger claims about the ways digital media operate in social protest movements, and why outcomes vary from one revolutionary effort to another.

The core of his argument seems to be that social media networks “can trigger informational cascades through the effects of their interaction with independent media outlets and on-the ground organizers” (p. 22). In turn, these informational cascades “can make it difficult for regimes to maintain their control of information hegemony” and can stimulate collective action “by lowering the ‘revolutionary thresholds’ of individuals embedded in social networks” (p. 22).

The idea of a “revolutionary threshold” apparently comes from political science and is rooted in a homo economicus theory of humans in which we are all posited as rational calculators seeking to maximize our rewards while minimizing our risks. The idea seems to be that different people are more or less likely to join a revolutionary movement based on how they evaluate the potential risks and rewards to themselves.  For example, the risk of joining a particular protest declines with the size of the protest, since  the probability of getting caught declines as the number of protesters rises. Instead of looking at how people act from values, this model essentially takes the values as read and asks what prevents people from acting on values in particular (contingent) situations and what lowers this threshold enough that they weight the rewards of participation as exceeding the risks–their “tipping point.”

Read more…

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