India versus China
Now Playing: Kelly Clarkson - Since U Been Gone (Jason Nevins remix)
Topic: Outsourcing

From the newest CIO Insight, an associate dean from HBS discussing the IT environment in China as compared to India:

"First, China has a much more robust internal IT structure, networks and so forth, than does India. They've had a massive telecommunications expansion, and they have more networking capacity than people think. All of that has been a direct result of national economic policy."

This one surprised me but it shows that a coordinated, country-wide initiative from the central government (whether it be a free market or mixed economy), can be more successful than only allowing the market to decide. The current debate on whether U.S. municipalities should be offering wifi services as a public good, either in cooperation with or in competition with the telcos, raises the same issue.

"The biggest risk I see is political. All of the growth in China has been heavily concentrated on the eastern seaboard. That has intensified the divide between rural and urban life. But as long as the government can deliver 7 percent or 8 percent growth annually, the poorer people will remain patient. The Chinese government's problem is trying to maintain a fast-enough growth rate that the citizens on balance will buy into it."

I delved into some of this for my undergrad thesis on the international trade patterns of Chinese imports and exports and the economic vs. political factors involving globalization. China has taken a very different approach than Russia underwent following the fall of the Berlin Wall. Russia went full 100% liberalization, both economically and politically, and the combined shock of both was too much for the country to handle. China has taken a different approach, preferring to liberalize the economy while maintaining a strict, centralized hold on the country's political environment.

The challenge for Chinese leaders is to maintain the economic growth to appease or mollify a populace increasingly unsatisfied with the lack of corresponding political freedom that other former communist, not liberalized, countries enjoy. What happens if they can't maintain the economic growth?

"The worst case scenario is that you have a revolution."

Here's The Economist's take (password required, try BugMeNot) on China versus India from back in June 2003.

Posted by cph19 at 6:45 AM EDT

Updated: Friday, 7 October 2005 6:48 AM EDT

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Outsourcing vs. Insourcing
Now Playing: The Avalanches -
Topic: Outsourcing
Outsourcing rears its heads again in the latest issue (April 2005) of WIRED. Check out their outsourcing info graphic:



And since I'll have The Avalanches' "Since I Left You" on non-stop repeat for the rest of the day (I'm writing a paper on DRM and need something to keep me going), see what happens when you listen to ABBA's Dancing Queen for four hours, on a trip between Iowa and Chicago. For all of us who have made that trip before (4-5 hours depending on traffic), you understand what kind of pain this experiment could yield.