What is Your Purpose and Responsibility in Society?

We Are All Actors. Being a Citizen is Not Living in a Society. It is changing it. (Augusto Boal)

What kind of country do you live in? Are you living in a developing economy, or in a welfare state? Or, in a transitory state? Or, in a failed state? If in a failed state, you are most probably not even capable of reading this post, since a failed state is a) either in some sort of crisis (e.g. war) or b) not allowing its citizens to surf the Internet, or even participate in social networking, and social networking/professional business sites, such as LinkedIn.

Market fundamentalism is out, as is belief in comprehensive state interventionism. (Gylfason & al. Nordics in Global Crisis. Vulnerability and resilience. 2010. 20.)

Whichever kind of state you are living in, it is worthwhile noticing that your state, including its governance and legal aspects, have a major influence upon the economic development, and possibilities, for the country´s citizens. Many citizens in countries, feeling non-empowered, believe they have no influence upon their surroundings. This, however non-empowering it may sound, is a false belief. Every citizen has a voice, and the possibility of influencing the economic, and thus societal, developments in their country.

In Welfare States, including Finland (situated in Northern Europe) the outbreak of the financial crisis in 2008, often compared to the Great Slump of the 1930s (or even worse), and the economic events of the past years, together with the current economic situation both on micro and macro levels, intertwined with estimates and forecasts for the future have certainly given many, not only economists, but in general citizens of the world food for thought.

Milton Friedman about Welfare State Dynamics

Many countries have been hit hard by the crisis, and have not yet recovered – including several small, open economies, vulnerable to, and severely affected by, global developments. However, some of the shocks were internally created, leaving some of the responsibility of “cleaning up the mess” to domestic institutions, and policies. (Gylfason & al. Nordics in Global Crisis. Vulnerability and resilience. 2010. 21).

Coe, N., Kelly, P., and Yeung H.W.C. Economic Geography: A Contemporary Introduction. 2007, have discussed the role of different kinds of states and firms in economy, with a purpose to pinpoint how these, together with supra-national institutions, shape economic processes. The discussion about the changing role of the state in an era of globalization, together with the demonstration of why geographical scales matter when re-configuring a state, is also of out most relevance.

A state has several functions:

– A state is the guarantor and institution of economic activities dealing with financial crisis, guaranteeing national economic instruments, securing international economic treaties, property rights and the rule of the law.

– A state is the regulator of economic activities such as market regulation, and the regulation of economic flows.

– A state is the architect of the national economy, including trade policies, strategic industrial policies, attracting FDI (foreign direct investment), and regional development policies.

– A state is an owner of public enterprises.

– A state is the provider of public goods and services, such as infrastructure, healthcare, transport, and education.

– A state has also political-economic influence upon mergers and acquisitions, through regulatory control.

– On a geographical scale, a state plays a role on international, macro-regional, intra-national, and local levels.

The vast amount of different types of states existing today is divided into:

– Neoliberal states (North America, Western Europe, and Australasia).

– Developmental states (Asia and South America).

– Transitional states (Eastern Europe, Russia, China, Southeast Asia).

– Welfare states (Nordic countries and some European countries).

– Weak and Dependent states and

– Failed states

In a reconfiguration of the state, following can be taken into consideration:

– A State is a dynamic set of institutions.

– The nation-state is a dynamic entity capable of self-transformation

– Rise of corporate power and global finance

– A nation-state is powerless in controlling inward and outward investments, or is it?

– The political-economic geographies, together with the mutually dependent relationship between state/firm

– The different power-relationships between states within the global economy

– The interaction between states/firms/markets.

– Nation-states shape profoundly the economic activity within and across their borders.

– The state itself is always implicated or involved in directing processes through conscious decisions.

– Nation-states remain critical institutions through which international, regional, and local economic issues are evaluated and acted upon.

– Economic governance on international and sub-national scales, upscale: international organizations such as UN, IMF, World Bank, and WTO, together with macro-regional groupings such as EU, APEC, NAFTA, ASEAN, NEPAD, SAARC, CARICOM, and MERCOSUR.

– Hollowing out the state = state functions taken over by public-private partnerships and private forms of regulation QUANGO = Quasi-Autonomous Non-Governmental Organizations

– Leading business media Beyond the State?

– State control is uneven in its operation and effectiveness

Traditional welfare states, such as Finland and Sweden, have not avoided the global crisis, the reasons for which include the level of openness, and the dependence on exports of investment goods. Both Finland and Sweden experienced an equally severe slump in the early 1990´s with the difference that it was at large homemade. Lessons learned from the 1990´s crisis include that early signs of financial fragility need to be taken seriously, and policy planning needs to base upon worst-case scenarios. The current crisis, still ongoing, includes problematic consequences: public finances have deteriorated, unemployment is high, and significant structural changes in the economy are taking place. (Gylfason & al. 2010. 21; 118).

Restoring public finances can be taken care of in many ways, as suggested by Gylfason & al. (2010. 28):

– Public consumption and transfer payments can be cut

– Composition of expenditure directed in a growth-friendly way

– Smooth flow and functioning of infrastructures, including communication

– Well-functioning education system and funding of research

– Broadening the tax base by raising the employment rate

– Changing the structure of taxation in a way that encourages economic growth, i.e. reduction of taxes on productive economic activity, corporate and labor taxes, and an increase in taxes on consumption, natural resources and real estate.

Due to globalization, the mutual interdependence between countries is stronger than ever, suggesting that there is a need for stronger international, and global, cooperation in areas including trade policy, financial regulation and supervision, macroeconomic policy and actions to prevent climate change. (Gylfason & al. 2010. 31).

However complex policies are, the maintenance of a welfare state, and economics, includes the following:

– A democratic system with equal rights and possibilities for all citizens

– A solid infrastructure in terms of access to services such as education, and healthcare

– A balanced economy, with little deficits

– A lucrative, innovative environment attracting FDI and sustainable economic growth

– A taxation policy attracting firms, which in turn create jobs and employ citizens

– A taxation policy that is attractive for all kinds of firms, including small enterprises 

These are measures that, in a welfare economy, are expected to be taken care of by the state, and therefore, through public policies. Firms, on the other hand, choose to operate and invest in markets capable of offering them attractive conditions, and an optimization of factors included in a PESTLE analysis.

However important the role of the state, or a nation, a state is always being constructed by its citizens. Citizens who have the possibility of influencing their direct and indirect surroundings, including their personal lives, their neighborhoods, the politics of their country and so forth. In fact, every single action, and every single effort made by an individual in a country, has direct and indirect impacts upon the developments in the nation in question.

Thus, your personal efforts, however small they may seem, always do have an impact upon the society you are living in. Never underestimate your capability of influencing, changing, and developing society and people around you, because often, small actions and improvements lead to giant leaps and changes in (economic) development.



What Really Makes People Successful

There are countless articles, and books, available upon success and different kinds of success stories. We have all seen people succeed, in different kinds of settings.  All successful people, including their stories, share a number of common factors.  

One of the most important factors in succeeding is taking action. Yes. Successful people are active. Active does not equal to running around like a headless chicken. Successful people take action instead of just thinking about it. Say, for example, that you want to learn how to speak Chinese fluently (just like Mark Zuckerberg). What do you do? You take action. There are many ways of learning a new language, but it definitely always requires taking action. Mastering a language requires learning, practicing, and using the language. Or, if you want to write a book – the book won´t finish by itself. You need to take action, and start writing. Of course writing a book is much more than just writing – you need to be well-organized, capable of planning a writing process, having a common thread in order to create a good story. In addition, you need to understand something about marketing, and commercializing your book (unless you are writing a book only for yourself). Of course, if you do not have any marketing skills, you may need some help with it. Activity is the key word. No action = no results.

This leads us to the next quality of someone very successful.

FOCUS. Successful people are well focused, and they know how to focus. We all know how important it is for athletes to focus on their performance e.g. before an important competition. Well, actually athletes need to focus at all times, since they are training a lot – and they need to live accordingly, including what they consume, how they sleep, who they spend time with. 

And yes, here we come to the next point: Successful people choose how they spend their time, and with whom. Of course we cannot always choose who we work with etc., but basically there is a possibility of selecting who we spend time with when not working. Or, choosing who we work with if we are self-employed, or running our own business. In fact, we become like the closest people to us, and those we spend most time with. This is also one reason for why people often go apart when the other person starts changing to an extent that no longer allows them to continue on the same “level”. Unless the other person can adjust to that, and there is simultaneous growth in both. In this sense, weak links are often regarded more important for example in job search. Although friends and family may help us find new possibilities, they very often do not want us to change, to move, or to become different from what we are today. 

Succeeding also requires being capable of stepping out of one´s comfort zone. I constantly read about people´s problems stepping out of the comfort zone, behind which often is fear (of change). In fact, just last week I read somewhere that only 2 % of all people regularly step out of their comfort zone. The rest likes to enjoy the status quo, due to various reasons. Of course we are all different, but stretching one´s limits every now and then is not harmful. An interesting article, “6 Ways Pushing Past Your Comfort Zone Is Critical to Success”, was published in Forbes earlier this year (Caprino, K. 21.5.2014). 

Having confidence in one self is also extremely important in succeeding. If no one else believes in you, or cheers you up, you need to be your own best friend, motivator, success coach. In fact, motivation starts from within us. It can only be triggered by someone else, e.g. through inspiration and support. But we need to confide in ourselves in order to succeed. Other people may, in fact, sometimes show feelings of fear towards our success, which makes it even more important to be able to stay strong even in tough times. If you truly want to succeed, you won´t let criticism, jealousy or other fearful actions let you down. Constructive criticism is always at place, but if someone constantly criticizes you it may be because they are fearful of something. Don´t let anyone turn you down. If you don´t have a personal (success) coach – make sure to be the cheerleader of you own life, and career.  

Productivity is something all successful people possess, which relates back to being capable of taking action. Successful people do not hesitate – they take action – and they produce. Productivity usually increases with experience, but if you are successful in creating something new (think about Albert Einstein for example, or Thomas Edison), it often takes more trials and errors before the actual breakthrough. You just need to keep going, and trying.

Embracing failure. Admitted – none of us enjoys failure, but it is a crucial part of success. If you give up after every single failure, you are not succeeding. Being willing to succeed requires the ability of embracing failures as well. Failure makes us develop and grow. When we fail, we learn from it, and try even harder, or in a different way, after failing. 

Success also demands the capability of long-term planning. If you want to succeed, you need to be able to plan ahead, let´s say for the next five years ahead. Start by estimating where you want to be in five years, and then make a plan for how to get there. Just remember – always plan with room for adjustments, and possible drawbacks.

Finally: Other people do not always need to understand you. Those who need to understand will do so, and the rest does not matter. What matters is you understanding yourself.

“The size of your success is measured by the strength of your desire; the size of your dream; and how you handle disappointment along the way”.

Robert Kiyosaki


Taking Action Rather Than Procrastinating

“Vision without action is merely a dream. Action without vision just passes the time. Vision with action can change the world”.

(Joel A. Barker)

Any kind of change requires activity and action. Be it in our personal lives or in business. I have learned, through personal experiences, and through observation of other people and companies, that a fear of making the wrong decisions leads into inactivity, which in turn leads to increased inactivity and there we are – in a vicious circle. 

I have written about the influence from external events, such as the news that are brought into our consciousness every day through various media channels. Experience has taught me that listening to news, in general, can have a huge impact upon the decisions that I am willing to make regarding both my private life, and also regarding business decisions. 

In the world of investments, investor´s actions are often referred to as actions based on mass psychology. When hearing bad news about a certain economy/market, or about a specific company, many investors react quickly based upon that information. Some may react e.g. by selling all stocks of that specific region/company. Others, called contrarian investors, go against prevailing market trends by buying poorly performing assets, as opposed to “traditional” investors.

Keeping a cold head in any kind of situation is important. Be it in personal life decisions, in business practices, in investing or whatever. The world is full of temptations, but also full of what we could call propaganda. The word propaganda has a very negative echo, but any intelligent person knows how important it is to question everything one reads, hears, and experiences. I´m not saying that one should not trust anything; however, questioning sources of information, and staying objective, is healthy. One way of questioning and staying objective is to be very selective regarding the sources of information that we use in our everyday lives. Taking some distance in regard to e.g. news and media can sometimes prove to be an efficient way of getting in touch with one´s inner guide: the intuition. 

Many people have lost the touch with their intuition, because they are always affected by external distractions, be it news, media, other people, friends, family etc. Taking some distance and being selective is a good way of finding back to listening to our intuition, since it rarely mistakes. How you react to something, and how you feel about something rarely lies to you. 

Sometimes reflecting upon various things is a positive thing to do, but mostly procrastination leads to an increased difficulty in decision-making. This is where mass psychology has a huge influence: if, let´s say in a certain market, the economy has been in recession for years, it easily leads to even worse decision-making, or no decision-making at all. Investments are being cut down; companies are dismissing employees, which lead to decreased consumption and so on. 

Markets are always turbulent, if we let them be. Media is capable of bringing negative news into daylight, but smart entrepreneurs know that there always is a demand for their services/products, and that there always is a market for those who are ready to take action, create new demand and push their services/products to consumers. This, in turn, requires the ability and willingness to hire the right people to help the company in succeeding – people (employees/consultants) who believe in the product and who know how to generate income for them and for the enterprise. 

“Inaction breeds doubt and fear. Action breeds confidence and courage. If you want to conquer fear, do not sit home and think about it. Go out and get busy”.

(Dale Carnegie)