Developing Jen

Jessica Jackely, co-founder of Kiva and the newly launched Profounder, gave an intensely personal talk at TEDGlobal last week.  It was met with a standing ovation and actually, it was the single talk that brought tears to my eyes.  In addition to conveying her deep passion for development, Jessica had some very insightful things to say about the psychology of philanthropy and the mechanisms with which those who give engage with those who receive.

According to Jackley, the exchange that characterizes the way many give today can get in the way of the thing we want most.  We often give more to alleviate our own sense of guilt than out of a desire to truly help.  Doing something, she says, should not be a business transaction.  

Furthermore, the way we tell, share, and participate in stories is of deep importance.  The distinction between us and them and rich and poor are false dichotomies.  We shouldn’t think about the world along these lines, because it promotes the wrong mindset towards engagement.

Jessica goes on to say that the best way to change people’s lives is to give them control over what they believe is important.  We should be engage in a way that validates dignity and promotes respect (I imagine so many Tweeps doing cartwheels of joy at that statement).

Lending, rather than giving, enables this according to Jackley.  Whereas giving is transactional, lending fosters engagement through ongoing dialogue and continued attention.  Put succinctly, (Love + Money) > Money.

I think Jessica’s general points about philanthropic motivations and engagement are excellent. Personally, I’ve been fascinated by the psychology of philanthropy of late.  What motivates people give?  How do they make lending decisions?  What do they want in return?  These are critical questions for understanding the aid community.  Furthermore, I think she’s right on point that we should engage in a way that empowers, rather than paternalistically.  But I’m not sure I agree with her final conclusion about lending vs. giving.    

First, I don’t think that engaging in a way that validates dignity and gives people control over their lives and grant making are mutually exclusive.  Not all of the things done in development are market oriented, and I believe there should be a continued role in supporting non-profit activities.  However, in tune with Jessica’s points, I think that individuals on the ground should be empowered to determine and execute on those activities.  This validates dignity while also supporting a broader scope of initiatives than would be the case if the focus were on investments that bring a return.

Secondly, though the Kiva model certainly achieves Jessica’s first objective of empowering people to do what they believe is important, I’m not convinced a Kiva transaction is that different from just giving away money.  When we talk about social investing, I think an important question to ask is, “what’s the investor’s alternative?” It is a very different thing if that alternative is giving money to charity or investing in a mutual fund.  I think in many cases, especially cases involving small amounts, people make decisions as if they were simply giving money away.  When someone goes on Kiva, I don’t think they’re determining to whom to loan money based on creditworthiness (it would be impossible for someone sitting at a computer in London to assess an entrepreneur and opportunity in Nairobi at any rate).  Rather, I think they’re doing it based on a picture and to Jessica’s point, the story that the individual brings. Their motivation is more about charity and less about investment.  Perhaps that's just fine, but I think it's a distinction worth noting -- especially when looking to crowdsourcing for larger sums (which is what Profounder does).  

Ethan Zuckerman is a Senior Researcher at the Berkman Center for Internet and Society at the Harvard Law School.  Incredibly and embarrassingly, I never managed to link with the Berkman Center during my time in Cambridge, so I was thrilled to see Ethan would be speaking at TEDGlobal this past week.  His talk was another of the highlights of the conference, and one of particular relevance for those of us interested in how the access to information that the Internet affords impacts development.

In essence Ethan said that while we perceive the Internet to indicate a globally connected world, in reality the information we consume is confined to like-minded microcosms.  We end up in “filter bubbles,” interacting with people we already know, which isn’t how the Internet was supposed to be.  The media, he says, is less global by the day.  New media isn’t helping us that much after all. 

The reason?  The tools we use to access the information available to us via the Internet are great at helping us find the information we’re looking for, but fail to engineer serendipitous encounters with information you don’t know you need.  We look to our social network for this type of content, and as a consequence find ourselves in like-minded flocks.

This is an issue because real and interesting problems global in scale and scope, require global conversations to get to global solutions.

The way to get out, Zuckerman says, is to find someone who will bump you out of your flock.  Bridge figures like Erik Hersman (nice shout out to @whiteafrican in his talk!) can play this role, since are connected to multiple worlds.  He also says we should cultivate xenophiles, who will cross the bridge and bring the message back home.

While this all makes great sense to me, I wonder if the bridge figures and xenophiles would only take us so far.  This is actually something I wrote about awhile back in a blog posting here.  As my former professor David King explained, the world is getting narrower as the information we have access to becomes broader.  The more we have to process, the more we’re forced to rely on more efficient mechanisms to process that information.  In doing so we succumb to confirmation bias, tuning into channels that confirm what we already believe.   By contrast when we only had a few channels to tune into (i.e. before the era of cable television), we by necessity of the diversity of the audience consumed a diversity of information.

If this is true (and it makes sense to me) then we’d seek out bridge figures who would only bump us so far out of the flock.  My hunch is the reality of our psychology will make addressing this problem even harder than Ethan suggests.  

Tim Jackson, who among other things is the UK government’s advisor on sustainable development, raised an important issue at TEDGlobal this week in Oxford.  At least I thought so, because it struck at one of the central things on my mind these days (outlined in a recent blog posting here).

Jackson makes two points, one obvious and the other less so.  The first is that economic growth is fundamentally constrained by the resources of this planet.  Our way out to date has been a blind faith in our ability to improve efficiency and build technology, but the reality is that we can’t keep going on like this forever.  We need to stop looking to economic growth as a proxy for human prosperity.  We’ve grown our economies so much already that we risk undermining the very prosperity we seek.  

His less obvious point is the one I find fascinating and critical.  The institutions we’ve created – capitalism in particular – has negative implications for our culture, values, and norms.  As he put it so eloquently, which was instantly met with applause from the audience and retweeted widely:  

Why do we do this?  Jackson says that human beings experience tension between values in two dimensions: novelty-seeking behavior vs. tradition / culture preservation and self-regarding behavior vs. other regarding behavior.  Our institutions, however, encourage us to operate in only one quadrant of ourselves: the self-regarding, novelty seeking one. Taking this into account, he says that addressing our issue of unsustainable economic growth isn’t about changing human nature, it’s about changing out institutions to better reflect the full spectrum of human nature. It’s not about overthrowing capitalism, but broadening it to more fully reflect our values.  

How people access and process information, and what the deficiencies in that process mean for the challenges we face in international development.  I actually think this is very relevant for a long list of issues, especially aid and access to capital.

Prospect theory and the implications for development.  In sum, prospect theory argues that we value things not absolutely, but relative to other things.  This implies we're basically hamsters on a wheel, always trying to keep up with the Joneses.

The evolutionary role of fairness and how it shapes our behavior today (see recent posting from one of Sendhil's papers).

Where the right equilibrium is when it comes to measuring effectiveness and creating accountability in development.  In short, I think we have more to learn from the private sector than from academia (i.e. I have quite a few criticisms of the randomista camp).

How early stage investors access and process information to make investment decisions.  I'm very interested in fostering innovation and access to capital is an important part of it.  I wrote a paper on this for Asim Khwaja's class.  I thought he would throw up all over it because I argued that there are very significant behavioral elements.  He didn't.

The role of proximity in early stage venture capital, for the same reasons as mentioned above.  I wrote my final paper on this in Asim's class.  He actually liked it (he's unimaginably critical, which is part of why I love him so much).  He also thought I should push on the issue more, so I will post a cliff notes version soon.

I'm in the middle of biggest transition state of my life.  Not only am I just about to embark in a new direction with my career, but I'm also just about to transition from a girlfriend to a wife, and motherhood looms on the horizon.  As I move on to these significantly different phases of my professional and personal life, I'm doing a considerable amount of thinking about my priorities and how I want to live.  In doing so, I'm reminded of a real problem with the society I exist in. 

We're brought up to strive to get the best grades, to get into the best university, to get the best job.  What is it that's most widely lauded for these best and brightest of my generation's college graduates?  The highest paying, of course: investment banking and management consulting.  These are jobs where we work 100 hours a week, sometimes living out of a suitcase five days a week.  And once we have those jobs, we're applauded when we earn a raise or a promotion.  Competition for such recognition and income leads us to work even harder and compromise more and more of our personal interests.  We may live in big houses and drive BMWs, but what are we sacrificing for it?  One of the partners I worked with at Accenture once told me he was leaving one day for yet another business trip and his daughter said to him, "Daddy, when are you coming to visit us again?" 

One of the things I'm doing with my time off between graduation and working full time is taking a massive step back when it comes to my thinking about development.  I'm asking myself the following questions:

What do I believe should be the societal goals of "development"?  Is there some level of overall well being (or freedom as Sen would define it) that we consider a right of everyone that inhabits this planet?  If so, upon what basis are those rights determined?  Or is it that, given the human desire to "give back", there will always be a role for development so long as there is inequality? 

Answering these questions has led me to political philosophy and theories of justice.  It's an ocean that is more often than not obtuse, but I look forward to engaging on this topic in the coming months.  I think it's an important one, and it doesn't seem like we talk about it enough.