[androdev]

US offers equal opportunity to succeed to those who have the enterprising spirit and warrior mentality. Much more importantly, there is cultural acceptance and admiration of those who succeed irrespective of their background. In that sense, it does offer equal opportunity for social mobility and integration.

But if you lack enterprising spirit and warrior mentality, and happens to be a regular Joe who is poor, it is a very brutal country. Very little help from the state. In that sense, it offers no opportunity for social mobility and integration.

I think that's why we have this difference of opinion about US and Europe.

[antz.bin]

All this discussion about gini coefficient and all people being able to *make it*, with no mention of social mobility?

As per this article from Jan 2020, India was at rank 76 of 82 in terms of Social Mobility.

The Scandinavian countries topped the list and None of the G7 countries made it to the top 10.

While the economists here would know what Social Mobility is, here is a refresher for everyone else from the linked Wikipedia page:

Social mobility is the movement of individuals, families, households, or other categories of people within or between social strata in a society.

It is a change in social status relative to one's current social location within a given society. This movement occurs between layers or tiers in an open system of social stratification. Open stratification systems are those in which at least some value is given to achieved status characteristics in a society. The movement can be in a downward or upward direction. Markers for social mobility, such as education and class, are used to predict, discuss, and learn more about an individual or a group's mobility in society.

You can find the full list of 82 here.

Here is a snapshot of our peers in the list.

[Samurai]

Originally Posted by antz.bin

All this discussion about gini coefficient and all people being able to *make it*, with no mention of social mobility?

Have you read the last two pages?

Originally Posted by v1p3r

5 people in a Baleno to Udupi? Not me for sure!

No, it was 1+5 in a Baleno.

[antz.bin]

Originally Posted by Samurai

Have you read the last two pages?

Oops! I had only read the previous page .

Anyways, the Economics Explained youtube channel does a really good job on explaining why a certain country belongs at its spot in the world pecking order.

This here is an interesting one, especially considering the recent agriculture reform laws.

https://www.youtube.com/watch?v=TlhUMFOBZHU

[mvadg]

Originally Posted by Jeroen

It was rare to see black people on the campus If you saw one chances are they worked in one of the many cafeteria or were part of the fascility team.
Jeroen

I can confirm that this was the case even at my University in the USA. The Africans in my class were from Africa. The African American students never ate together with the other Americans at the cafeteria. I never came across any African Americans in any of my classes at the graduate level. I met just one African American in the tech company I worked at for a short while, and again, he was in the marketing department.

I saw the same behavior in India during my undergraduate years with the "backward class" group - they were on a separate "production line" and except for the really social ones, none of them ever mingled with the "regular" students.

[Samurai]

Originally Posted by mvadg

I saw the same behavior in India during my undergraduate years with the "backward class" group - they were on a separate "production line" and except for the really social ones, none of them ever mingled with the "regular" students.

It is a chicken and egg problem really. I remember my batchmate from college, he had secured 1st rank in Bangalore University (this was before VTU) in electrical engineering. But he was sounding quite sullen. This is how the conversation went...

Me: You look quite unhappy for a guy who just got 1st rank and with multiple job offers at hand.
He: 1st rank is nice. But the job offers I am not thrilled about.
Me: Why? Those are reputed PSU jobs.
He: I would have secured the same offers if had just 55% marks. Even though I got 1st rank, they have offered the job under SC quota because I had to provide caste info. No one will remember my rank/marks once I join, my pay/promotion/role will be dictated by my SC quota, and not my merit. I prefer to join some private company where my caste will not be asked, and no one will know my caste.

That is one major difference between caste and race. Caste can be hidden by using an initial instead of surname. But race can't be hidden. When blacks work in hi-tech companies, either they have to be ridiculously good or genius level, or everyone will assume they are just filling diversity quota. Notice how in movies or TV shows, the nominal black guy is either brilliant or very funny.

[ashokrajagopal]

Not that it generally matters to the discussion going on, but we are discussing economics, so let me say this.

I have nothing against the places referred below. In fact I think about these things as if I am talking to a nerdy Martian.

Consider:

a) US has freedom and welcomes energetic brilliant minds with fighting spirit to advance humanity.

b) US has dollar, which was the global reserve currency for 50 years.


Be honest, be objective and pls think which is more important for "economic" well being
The average American entrepreneur has more access to capital than the best ones elsewhere by virtue of geopolitics.


The fact of the matter is no country is standalone in the world. Countries need to be placed in a time-space continuum.

[Samurai]

Originally Posted by ashokrajagopal

Be honest, be objective and pls think which is more important for "economic" well being
The average American entrepreneur has more access to capital than the best ones elsewhere by virtue of geopolitics.

I did work in a startup in US during the dot com bubble, with people offering to buy company, etc. So I understand access to capital. Yet, I returned to India to start my first company.

Last year I started my second company, without any funding. Capital is important, but it is not everything. That is what I have learned. People who only see things from financial POV may not understand or appreciate it. But I am cool with it.

[Jeroen]

Originally Posted by ashokrajagopal

The average American entrepreneur has more access to capital than the best ones elsewhere by virtue of geopolitics.

Some perspective and interesting data on worldwide entrepreneurship. India outperforms the USA by a very good margin. Go India!



Source: https://thebossmagazine.com/top-10-e...urial-nations/

[ashokrajagopal]

Originally Posted by Samurai

Yet, I returned to India to start my first company.

Last year I started my second company, without any funding. Capital is important, but it is not everything. That is what I have learned. People who only see things from financial POV may not understand or appreciate it. But I am cool with it.

You are also what one can call a statistical outlier, so..

Originally Posted by Jeroen

Some perspective and interesting data on worldwide entrepreneurship. India outperforms the USA by a very good margin. Go India!

If I may, this is exactly the kind of make-believe stats that goes around with nothing backing it. We know why Gautemala, Ireland and Luxemborg figures in any "entrepreneurial" list. Its a three letter word.

Edit: Also from the quoted page, they have
"The US takes the crown with the most financial support for new businesses and entrepreneurs, with an index score of 15 out of 15. This means that the US is the best country for providing financial resources‚ such as equity, credit, subsidies and grants, to small and medium enterprises (SMEs)."
And they have placed India where 50% are fearful of starting a new business at second spot. Its a strange list.


Capital investment to finance any innovation is well researched. Below is from a recent study about all things tech.

[Samurai]

Originally Posted by ashokrajagopal

If I may, this is exactly the kind of make-believe stats that goes around with nothing backing it.

Capital investment to finance any innovation is well researched. Below is from a recent study about all things tech.

Aren't you two talking about different things? Jeroen is talking about entrepreneurship and you are about venture capital invested.

You are assuming capital investment and entrepreneurship are strongly correlated. It is not true in every sector. It is somewhat correlated, but correlation doesn't always mean causation. Capital is great catalyst for entrepreneurship, but cheap access to capital also leads to crappy/fake entrepreneurship. I have seen plenty of such scams which led to dot com crash eventually.

[ashokrajagopal]

Originally Posted by Samurai

Aren't you two talking about different things? Jeroen is talking about entrepreneurship and you are about venture capital invested.

You are assuming capital investment and entrepreneurship are strongly correlated. It is not true in every sector. It is somewhat correlated, but correlation doesn't always mean causation. Capital is great catalyst for entrepreneurship, but cheap access to capital also leads to crappy/fake entrepreneurship. I have seen plenty of such scams which led to dot com crash eventually.

Well, there is really no empirical way to sort this out.
The whole idea of "Entrepreneurship" is largely influenced by the chances of success and a possible second chance if one fails. We can think of many other attributes, but there is really no way it will work without an environment of capital.
It may not be correlated in established traditional sectors, but for anything new, capital invested is essential.
US has been the centre of entrepreneurial brilliance by a long margin.
US has also been the centre of capital abundance by a long margin.

[Jeroen]

Originally Posted by Samurai

Aren't you two talking about different things? Jeroen is talking about entrepreneurship and you are about venture capital invested.

You are assuming capital investment and entrepreneurship are strongly correlated. It is not true in every sector. It is somewhat correlated, but correlation doesn't always mean causation. Capital is great catalyst for entrepreneurship, but cheap access to capital also leads to crappy/fake entrepreneurship. I have seen plenty of such scams which led to dot com crash eventually.

Thanks. To stay in tune with some of the earlier comments; one could argue that if you are a real entrepreneur and “put you back into it” you will find financial backers. It’s only the lazy entrepreneurs that need support to find cheap and easy access to capital.

On a more serious tone; The typical entrepreneur story that is being taught in places such as Stanford is one that does need capital, enter the like of capital ventures. During my stint at Stanford I had the pleasure of meeting some of them. And I have had some professional dealings with them as well.

I am oversimplifying but their business model relies on supporting a whole bunch of whacky entrepreneurs, knowing full well that out of every 100 initiatives, only a few will be successful and fewer will be hugely successful. Works for them and I was fascinated by their stories and insights on how they pick the entrepreneurs they decided to support, what they look for. Because it ain’t a reliable forecast or solid business case.

But it does mean that an awful lot of money and effort goes to waste. The fast majority fails big time. Now, one of the things I like about the USA is that failing isn’t a big thing at all. In fact it is seen as pretty good experience. And it is.

At the same time, if you zoom out what a few individuals stand to gain and loose, you could also argue it is a very wasteful system. Yes, that system got us the likes as Elon Musk (although he did not really attend Stanford, he embodies on what they stand for), but at what price to society.

Anywhere else burning through resources and money would be heavily frowned upon. So I am still in two mind about the pro’s and con’s of all of this and how to weigh it up.

Jeroen

[ashokrajagopal]

Originally Posted by Jeroen

At the same time, if you zoom out what a few individuals stand to gain and loose, you could also argue it is a very wasteful system. Yes, that system got us the likes as Elon Musk (although he did not really attend Stanford, he embodies on what they stand for), but at what price to society.

Anywhere else burning through resources and money would be heavily frowned upon.

If I may poke my nose in once again, this example sort of points to what I wanted to say.
Elon Musk investing $1 billion into the nothingness called Bitcoin. He openly talks about stuff like Dogecoin in twitter.
I mean, its not like he is the Warren Buffet type figure, he is supposed to be the brightest mind.
Only in US can that happen. Everywhere else, they know the value of $1 billion.

[v1p3r]

Originally Posted by Jeroen

I am oversimplifying but their business model relies on supporting a whole bunch of whacky entrepreneurs, knowing full well that out of every 100 initiatives, only a few will be successful and fewer will be hugely successful.
...

Anywhere else burning through resources and money would be heavily frowned upon. So I am still in two mind about the pro’s and con’s of all of this and how to weigh it up.

But if you look at the macrocosm, it isn't burning through money. If a fund follows the above philosophy and has a 20% IRR because of its outliers, it is hugely successful. If I am spending 10 dollars each on 10 companies, and one company ends up worth 1000 dollars while 9 fail, I've still made a 10x return. There is no way to make ALL your investments the outliers.

Now someone will point out that venture hasn't beaten the S&P over a 30 year period.

Originally Posted by ashokrajagopal

Elon Musk investing $1 billion into the nothingness called Bitcoin. He openly talks about stuff like Dogecoin in twitter.
I mean, its not like he is the Warren Buffet type figure, he is supposed to be the brightest mind.
Only in US can that happen. Everywhere else, they know the value of $1 billion.

I think it's a brilliant move. BTC has grown 5x over one year. TSLA is sitting on ~20 bn in cash reserves, and its stock is basically more cash. They convert 7.5% of their cash into a fast-growing liquid asset. Their stock price provides ample buffer against any downside there. EM can himself influence BTC price, and that is outside SEC purview. As far as financial engineering goes, this is a good decision. No wonder TSLA investors and board have blind faith in EM.

I would argue he knows the value of 1 billion more than anyone else. It's true that it can happen only in the US - which is why the world has only one superpower. Like our man said, 'risk hai to ishq hai'.