Jump to Main Content
USA flagAn Official Website of the United States Government
Industry Word

Blogs.Industry Word

Register

First thing to do is lay the foundation

Comment Count:
0

Comments welcome on this page. See Rules of Conduct.

First thing to do is lay the foundation

By DawnRiversBaker
Published: February 2, 2010

Economic infrastructure. Do you know what it is?

We don't spend very much time talking about it, although there are communities around the web that devote their entire intellectual capital to looking at it and figuring it out — largely because building economic infrastructures needs to be done as a first step toward helping a lot of third world countries to piece together a thriving economy that will end the crushing poverty in so much of the world.

But I digress.

I'm talking about economic infrastructure because I've been thinking about it a lot lately. I even wrote about it in this piece* for the American Express OPEN Forum Innovation hub. This is how I explained it:

What I'm talking about here is our economic infrastructure. That means the distribution systems, the laws and the courts, the contractual conventions, the regulatory regimes, the political constructs, the paper trails and the administrative tasks attached to every sort of transaction available.

Microbusiness owners are generally a creative bunch. We have to be in order to operate our firms in the kind of hostile atmosphere generated by an economic infrastructure that doesn't fit the way we do business.

I spend some time discussing that in the article, too. You really should go and read it.*

But if, as I say, small and microbusinesses are busy creating our own economic infrastructure to fit our own businesses, what does it look like?

We all know what it is, right? But, like obscenity, it's kind of hard to define except to say that 'we know it when we see it.'

We don't really do the same kind of anti-competitive competing as the giants liked to do in the last century. (Well, actually, they still like to do that stuff.) We're very networked and are much more about connecting and collaborating.

Their infrastructure was all about pillage and plunder — sort of like Modern Day Huns. We are a very low-resource bunch, we can't afford that sort of wastefulness. So we're not inclined to tear stuff up (not even the planet), if for no other reason than that we figure we might need to use it again later (especially the planet).

There was a lot of exclusiveness about their infrastructure. In order to keep upstarts out of their systems, they made their systems very expensive to use. Unfortunately, that has ultimately lead to them being forced to behave like starving rats and eat their own legs off when resources coming in weren't enough to cover resources going out.

Sadly, that doesn't get you very far because, eventually, you run out of legs.

Our infrastructures are the precise opposite: inexpensive to use (because we don't have buckets of money), which makes the barriers to entry really, really low. And that is probably one reason why the number of businesses — especially microbusinesses, and even more especially nonemployer businesses (solopreneurs) — has been growing almost exponentially for most of the years of this century so far.

I could keep going but I think you get the point.

All of this brings up two questions in my head.

First: how far apart will these two economies diverge — the big boys economy and the rest-of-us economy — before somebody notices?

Second: at what point, if ever, will these two divergent economies begin to converge again? (And, as an added bonus question, do we want them to?)

* This link connects to a non-governmental web site; clicking on the link opens a new tab or window.

About the Author:

Leave a Comment

You must be logged in to leave comments. If you already have an SBA.gov account, Log In to leave your comment.

New users, Register for a new account and join the conversation today!