A book to make Wall Street quake—if Wall Street paid attention to the developing world.
The classic description of capitalism, writes Bangladeshi economist and Nobel Peace Prize laureate Yunus (Building Social Business: The New Kind of Capitalism that Serves Humanity's Most Pressing Needs, 2010, etc.), assumes that the free market imposes curbs on economic inequality. In fact, it does not work that way, and inequality is growing markedly across the world, requiring a rethinking of the tenets of not only free-market capitalism, but also the marketplace. Such a rethinking, by the author’s account in this hortatory but accessible text, makes room for a hybrid “social business” that is not quite for-profit and not quite nonprofit but something that partakes of both while leveraging the human propensity for selflessness. In this regard, Yunus’ experiments in microfinance and microcredit, loaning small sums of money to businesspeople actual and aspiring, are cases in point. At the same time, he adds, a re-envisioned economics will recognize that humans are naturally entrepreneurs, best served not by jobs as such but by opportunities to make their own ventures in the marketplace. Again, his microfinancial work “introduced a new program of offering new-entrepreneur loans from Grameen Bank to support…efforts to create businesses” on the part of young Bangladeshis. Entrepreneurship catering to the mass market, Yunus argues, will prove more sustainable in the end than “trying to sell a few more luxury goods to a handful of wealthy people who already have more things than they will ever need.” A third plank of a revised economics includes sustainable, clean energy, which Yunus believes developing nations are better positioned to adapt than many advanced economies, precisely because they are more of a blank slate. While antithetical to the prevailing capitalism, the author’s reforms, he insists, will yield an economic system that more closely corresponds to who humans really are: partners and not predators.
The author’s humane proposal for economic reform, far from impractical, makes for provocative reading for development specialists.