Since we're skipping this assignment, I'm going to post my response to Reluctant Entrepreneurs / Black Sheep here! =)

I think the chapter “Reluctant Entrepreneurs” had the best overview of the pros and cons of microfinance, and insights into small business ownership in developing nations, of any article we’ve read this semester. For example, this quote seemed pretty in line with everything we have read, “Given the chance, it seems that even people who had been hit by extreme hardship were able to take charge of their lives and start their exit out of extreme poverty.” Later in the article, though, the harsh reality of small business ownership is spelled out. Many people do not want to own their own business; they turn to owning a small shop or corner store when all of the “desirable” jobs dry up. Faced with economic uncertainty, families turn to entrepreneurship to make ends meet but they are not mentally vested in their decision. In order to feel comfortable, people want a guaranteed paycheck and small business ownership is far from a guaranteed income.

I also found it a little odd that the interest rates for microloans are so high. I understand the math; a small loan has just as many transaction costs as a large loan and also requires a certain amount of return to be desirable to lenders, but 50+% seems like it’s just taking advantage of the needy. The article also mentioned that 97+% of the loans are repaid, so it seems the interest isn’t crippling… but it still doesn’t sit well with me.

“The Parable of the Black Sheep” seemed like a strange choice, as the author seemed to insinuate that poor people enjoy being poor. I’m not really a fan of the attitude that some people are just stupid and deserve to be poor. The parable started with a poem about people loving their poverty, then described the stupid ways his father didn’t bother to save money for a dowry, and then went on to blame people with their hand out for being in that position. While I believe people should try everything in their power to escape poverty, there are usually additional circumstances at play – people should be just a little less quick to make sweeping judgments about those less fortunate.

That said, I thought there were two great nuggets of wisdom in his words, the first is “Domestic violence thrives in a culture where women do not know what they are capable of.” When anyone fails to recognize their own potential, or capabilities, they leave themselves open to be taken advantage of. The second quote is, “Energy comes from the darkest days you have experienced. A person who has not been hurt does not have those experiences.” I think everyone finds their drive add motivation from different sources, but a terrible experience can show someone what they are capable of, or what they never want to experience again.

Hello, I'm following Stacie's lead and posting my reflection on "Reluctant Entrepreneurs" and "Parable of Black Sheep" here as well!

I thought that the articles “Reluctant Entrepreneurs” and “The Parable of Black Sheep” shed some excellent insight into the life of impoverished communities and how entrepreneurship helps them break the cycle of poverty. Both articles focus on the power of the individual and how anyone can build a life for themselves, even if the economic odds aren’t in their favor.

Looking at the “Reluctant Entrepreneurs” article, I found the information described on page 211 to be particularly interesting. The author states that “The fact that even after paying very high interest rates, the poor will manage to make enough money to repay their loans must mean that they are earning even more money per rupee invested”. (211) I think it’s great that many entrepreneurs in poor areas are able to not only pay back their loans, but make double the money. Everything in their situation is made to go against them (high interest rates, lack of capital, etc.) but they are all resilient and knowledgeable enough to defy the system and build a better life for themselves. I feel like this must come from a better knowledge of the marketplace and their own environmental needs. They have a more realistic and practical understanding about potential business opportunities and niches in their immediate communities.


The “Parable of Black Sheep” article starts with very similar themes touched upon in the “Reluctant Entrepreneurs” article. There are themes of poverty and the need to defy those limitations and have the desire to go against the status quo. While the author states that some people play the victim card, those who accept the fact that they have the power to change things are the ones that are successful. The point that stuck out to me the most was the author’s description of his mother. He says that “she belonged to that generation of women who were not raised to know what they could do themselves” (44). I think that this lack of knowing your self worth and power you have as an individual is crucial to keeping the entrepreneurial spirit alive and being able to break the cycle of poverty. On a deeper level, I think this is especially true with women in regards to gender issues. Lots of women are conditioned into thinking that they don’t have the power within themselves to be independent.

Reflecting on the two articles, I think both reflect on the importance of the individual and how everyone has the power to change their own situations. Recognizing your self worth is perhaps the best thing we can equip ourselves with.

The two readings this week: the chapter named “Reluctant Entrepreneurs” by Abhijit Banerjee and Ester Duflo as well as “The Parable of the Black Sheep” by Vijay Sharma both take a unique approach to the idea of entrepreneurship in the lower class.

Banerjee and Duflo take this on in a micro-finance directed way as they share their struggles to find entrepreneurs that would accept Al Amana’s loans as funding. “Al Amana is one of Morocco’s largest MFI’s in rural communities that had previously been completely excluded from formal financial sources.” In our capitalistic and western society, there are thousands of people looking for money to start and build their ideas and businesses. In the small villages in Moracco which Al Amana was targeting to assist, small business owners with different cultural beliefs, backgrounds, environments and more... just simply were not interested in the additional monetary assistance. I thought the story of Allal Sedan, a father and very small “business” owner was not interested in the loans as according to Sedan, there was no room for them to go and that he simply has enough. In America, it almost feels as if there is never enough and that our society is always pushing for bigger things and for what we consider to be better things. In other cultures that is not necessarily the ultimate goal, but hanging in there tends to be good enough. Another part about this reading that I thought was important is the way they distinguished between marginal return versus overall return. For funding, this is an important distinction as even though your marginal return may be high, your overall return, aka your profit, may be extremely low. A main point of this chapter, I thought, is the fact that it costs money to make money. It not only costs money in the forefront, but as an entrepreneur and small business owner you must also have a plan of action as to use the money to build and/or start your business so it will succeed. “If you have very little, use your ingenuity to make something out of nothing” is one of the quotes that stuck out to me in this reading. Entrepreneurship and what we study in our fair trade class gives those that have very little, a potential and a path to ultimately succeed. Creating something like selling “dosas, the rice and lentil pancakes,” like many in Morocco do, is not going to give you a path to economic prosperity, but something completely transformative and unique can. I thought this reading was interesting as it kind of approached entrepreneurship of the lower class in a harsher but honest way. Microcredit allows these smaller businesses to continue to expand, but owners and entrepreneurs have to be willing to take risks and broaden their ideas in order for it to truly work.

Additionally, as Stacie mentioned in her post about “The Parable of the Black Sheep,” I am also not a fan of the attitude that poor people enjoy being poor or that those in that position deserve it for a certain reason. While I definitely don’t agree with that, something I did take from that attitude is that those that appear to be stuck in a class or in a position can do something to change it, but it has to be from within. It is obvious that Sharma is an intelligent individual and was lucky enough to be so, and thus find a way out of “his fate.” Not all people are so blessed, however. But I do agree that “it takes a lot of courage to get away from these boundaries,” and that individuals have to be willing to work hard and struggle to get to a different place. Another quote that stood out to me is that “schools should encourage children to not agree with or accept the status quo.” I do agree with this as I believe if you reject the status quo, then your opportunities are greatened and you have no limit to what you can accomplish. One of the strongest things that I personally advocate for is the power of education and what doors having good teachers and the use of our abilities, can do. I thought the switch between the first, middle, and last school was really interesting and you could see what having an education allowed Sharma to become. It would have been easy to fall down the path of the cricket playing boys, but luckily due to having an educated father and mother he realized he was gifted with that potential. I think everyone has potential at the beginning, but how you apply your education, surroundings, etc.. is what separates people.

These two readings tie together in different approaches to the lower class, but I believe ultimately send the same message that in order to move ahead and succeed, you must be willing to put in the effort with time, money, energy, and creativity. Changing your environment and position is not an easy task but entrepreneurship and micro-finance give individuals the opportunities they would not previously have and gives them a way to escape the path others see for them. This is why Fair Trade is so great, because it gives individuals a path to change their lives on their own and for their community as well.

After reading Reluctant Entrepreneurs and the Parable of the Black Sheep, I can clearly see the key link between fair trade and entrepreneurship. As Reluctant Entrepreneurs began with a story of women scooping dry sand off the road every time a car went buy to sell to other people to clean their dishes, the idea became clearer to me. The line really rung a bell with me as the true definition of entrepreneurship, “If you have very little, use your ingenuity to create something out of nothing.” They talk about the poor having the most opportunities because their ideas are fresher and less likely to have been tried already. As for being low in the pyramid, they have the best innovations for making their lives easier. These insights are not only true, but apply to many aspects of life.

However, after reading this piece, one can see that entrepreneurs do not always have the capital or drive to expand their entrepreneurial ideas. It is a very true, but surprising fact in this reading. Many do not make even a small profit but do these things to survive. This is a different way of viewing the entrepreneurs of the poor. I do still believe that many of the poor are entrepreneurs and have a large determination to make money in order to survive. It is not solving the problem of poverty, but the entrepreneurs are thinking of solutions for their own poverty. This, to me, is the definition of an entrepreneur.

The thing I found the most interesting in the Parable of the Black Sheep is the reference to schools forcing the status quo on students when they should be challenging the status quo. Challenging the status quo was also a theme in Reluctant Entrepreneurs. Throughout the narrative, he challenged and questioned all ideas of school, work, and money. In the end, after he quit two weeks before his bonus, he stated “If you think you can hold me for money, you are wrong. If you think you own me because you are paying me, you are wrong.” This was the most impactive expression of language. He is defying the stats quo and holding his own which is the most inspiring action a person can do.

It is powerful to see someone ignore the status quo, do what they enjoy, and barely have enough money to survive. He was not influenced by outside forces like his family or schooling to do something he did not want to. His business invests in people- helping them find that energy to prove something as he did. This is the most interesting and powerful message someone can pass on to someone else. I enjoyed these readings because they incorporated the value of entrepreneurship with fair trade. Both use entrepreneurial spirits to create something of value either for oneself or people as a whole while recognizing the self in the equation.

The two readings we had to read for this week were similar in theme, yet different in how they approached or concluded to the themes. In Banjerjee and Duflo’s article, “Reluctant Entrepreneurs,” Banjerjee and Duflo go in depth about the many aspects related to micro financing.

What struck me as shocking was the point even if a high interest rate is imposed on the poor, they are still able to make the interest payments and even pay back their loans. Bajerjee and Duflo states “the sheer number of business owner among the poor is impressive. After all, everything seems to militate against the poor being entrepreneurs”(Banjerjee and Duflo 210). For the poor, they lack the resources, connection, and viable potential loans. If they are approved for the micro finance loans, they end up having to pay a high interest rate of 4% per month. However, even with the high interest rates, they are still able to have a profit: “the fact that even after paying very high interest rates, the poor still manage to make enough money to repay their loans… must mean that they are earning even more money per rupee invested” (Banjerjee and Duflo 211). If people are given a chance, they are able to reach their full potential. All anyone needs is a chance to excel.

Banjerjee and Duflo go on to talk about how many poor people do not grow their business, since for most of them, “it is too hard” (Banjerjee and Duflo 223). Is says that if a “micro entrepreneur realizes that she is probably stuck in the low part of the S-shaped curve and will never be able to make that much money, it may be difficult for her to be fully committed.” (Banjerjee and Duflo 223). While it is true that if given a chance and the opportunity, there is a significantly higher chance of success, if the individuals themselves are not willing to put in the effort and/ or get discouraged with the immediate results, then the “chance” given would be meaningless in a sense. In conclusion, Banjerjee and Duflo’s article reinforced the idea that anyone can succeed if given a chance and the opportunity to do so, but that individual effort and strong will are also factors that need to be incorporated.

In “The Parable of the Black Sheep,” Vijay Sharma starts off with a poem that, in all honestly, surprised me. The poem, when referencing to poverty, states “… and I cannot leave you because you love me even more,” (Sharma 37). I’m not really sure if this was being sarcastic, but I took it quite literally, and it seemed to me that the poet was suggesting that some people can’t help being poor, and that they even insist on being poor. The author goes on to say that when she was young, she used to think that the poor people were comfortable with where they stood in society, and that “they did not want change” (Sharma 38). I think it’s insensitive to say that the poor are comfortable with being poor and that they are “comfortable: with where they stand. I believe that the poor, and especially the poor, was change more than anything, but that they just simply are not given the chance to escape from their current situations.

The author states that “it takes only a little bit of courage to go beyond,” (Sharma 38), and I agree with that to a certain degree, but I don’t necessarily think it fully applied to the poor. It is horrible to say, but in most cases, if not all, the poor are rejected from society, and most turn a blind eye on them. Even if they had the “little bit of courage,” most people, especially businesses, would not be willing to give them a chance. However, I do agree with the author that proper use of knowledge is also important to help “prevent poverty” (Sharma 47). The author in this reading, like Banjerjee and Duflo, point out the overlaying importance of trying ones best, and putting in the effort, to succeed or “prevent” poverty. Acquiring a chance is also important, but one must be willing to make the chance into something worth even more; one has to be willing challenge the satus quo.

The two readings for this week share a common theme and emphasize the importance of investing in entrepreneurship. Both the chapter titled “Reluctant Entrepreneurs” and “The Parable of the Black Sheep” take on a similar approach to addressing the issue of poverty and lack of upwards mobility in the lower class. The chapters point out the shockingly high number of poor business owners compared to the proportion those actually attempt to grow their business. However, the tones used by the authors in each passage are different despite the similar theme.

In “Reluctant Entrepreneurs,” Banerjee and Duflo talk about the importance of microfinance in the funding of entrepreneurial projects. As we have previously learned, the poor are often neglected by commercial banks as an unprofitable market sector. Microfinance helps bring the poor into the banking system and help them get the funding needed to grow their businesses. It turns out that the default rate on these loans is extremely low especially when compared to the much higher default rates on commercial loans. The unbanked tend to get discouraged easily and fail to pursue expansion plans. They become content with the status quo, which perpetuates structural poverty and adds on to the lack of class mobility. However, when they do get funding, empirical data shows that despite the shockingly high interest rates of more than 4%, these poor entrepreneurs pay off these loans and actually succeed to grow their businesses. People just need to get a chance to improve their status and they will deliver in most cases.

The other text by Sharma takes a similar approach to the issue of poverty, but it takes on a much more reproachful tone. It almost seems as though the poor are content with the status quo and choose to remain where they are. Following the logic behind this viewpoint, that means that the poor can only move up in social class if they are coaxed to do so by a much wealthier individual or organization. I don’t agree with this viewpoint because I believe that in some areas, even those with a lot of ambition are set up to fail. They need outside help to break away from the exploitation plaguing their community and will jump at the opportunity to do so. Once again, all they need is a chance. I don’t think that the poor are “comfortable where they are” but I do agree that the courage received from somebody putting faith in their business can help people expand beyond their current capacity.

I believe that the outlook of these two passages is rather positive. Microfinance is expanding and there are goals to have over 95% percent of the world included in the banking system by 2020. These goals may be farfetched, but anticipating significant progress is still a realistic viewpoint. If these microfinance initiatives continue to fund entrepreneurial projects, we might see a significant decrease in the global poverty rates especially in third world nations.

I though "Reluctant Entrepreneurs" had some great ideas about micro finance and entrepreneurship. Something specific I liked that was mentioned at the beginning, was the idea that you don't need to have a lot of money to start something up. I think a lot of times we think of entrepreneurship as something for people with trust funds or a lot of means, which is false. In "Reluctant Entrepreneurs" the author shares the story of the women who sell sand, making money off of something that otherwise would have no value. This article makes the point that the poor often have better solutions for poverty, since they know what they need better than anyone else. Overall, I think micro finance is an incredibly interesting topic, and I love reading these kinds of articles.

Something else that struck me in this article was the last paragraph, specifically the last line, "but we are kidding ourselves if we think that they can pave the way for a mass exit from poverty." This made me think about if there will ever be a 'mass exit' from poverty, and if it is even really possible.

For the next article, "The Parable of the Black Sheep", I agree with Stacie that the article seems to imply that poor people like being poor. I was particularly annoyed by the quote "it seemed to me that their circumstances were driven more by the choices they had made than by the ecosystem." However, something I did agree with was the authors idea that the best time to work your way out of poverty is when your young. I think is probably easier to have the energy to get out of poverty when your young, as opposed to when your older, once your already used to the routine of your daily life.

Another thing I disagreed with in this article was that the author kind of implicates that it is somewhat easy to jump out of poverty, stating that it only takes a "little bit of courage". I disagree with this because I think in a lot of situations, you need more than just a little bit of a push. I think to make your way out of poverty, you must have the right kind of support group or mentors to push you to go above and beyond. I think in many situations it can be hard to find that kind of motivation or support group because so many people look down on poor people, and think they are inferior.

I found the Reluctant Entrepreneurs reading to be interesting because it explained why most of the poor remains the poor. It explained the Paradox of the poor and their businesses by stating, “They are energetic and resourceful and manage to make a lot out of very little. But most of this energy is spent on business that are too small and utterly undifferentiated from the many others around them. As a result, their operators have no chance to earn a reasonable living.” And on the same note, it explained, “the reason the poor do not grow their businesses is that, for most of them, it is too hard. They cannot borrow to cross the hump, and saving up to get there will take too long unless their business have extremely high overall returns,” like in the case of Xu Aihua.
This insight was interesting to me because it is such an obvious cycle that gets overlooked. Not only are there not enough microfinance loans available to these small businesses owners, but I think it seems they may lack the knowledge of how to properly grow their businesses to be profitable. Who is to say that money would answer their problems and get them out of the inbetween? That is why I thought the author’s point about having very little and using your ingenuity to create something out of nothing was really admirable because it sheds light of the idea of adding creativity to money making.
The Parable of the Black Sheep reading was really inspirational. The author’s opening line was really powerful in context with his life story. After he shared his poem that he wrote as a 12 year old, “I am poverty, I love you, And I cannot leave you because You live me even more,” he said, “I wrote what I felt-- I thought people were poor because they let themselves be.” He clearly fought that notion when he realized that he did not want to live in poverty.
I found that to be really powerful because he realized the necessary steps he needed to take to educate himself out of poverty--and from a young age! He realized that he needed to say no to the default action of letting “your environment and its social structure define how you are supposed to react to a situation” and that “the hierarchy defines the rules of the place.” He, as an entrepreneur, identified that he wanted to be in control of his jobs and money. I think that if more people had this sort of motivation to educate themselves to the best of their ability and then implement their knowledge, it would make such a positive impact because it would not only make money for the entrepreneur, but also create jobs for others in need. So this reading was really important to me because it talked about educating your way out of poverty, which is something that I really believe in.

"Reluctant Entrepreneurs" paints the micro-finance community in a much different light than the media. Despite the term, "entrepreneurial poor," it seems as if there has been a disconcerting morale towards the micro-credit returns. He paints the poor in two different lights--as likely to go into business as the rich, and still managing enough money to repay their loans. It is clearly shown however that when given an initial support of money and provisions, the poor can start to exit out of extreme poverty. Despite the benefits of micro-finance, the media fails to state that the poor operate tiny businesses and tiny businesses are making little money. Thus these small entrepreneurs are stuck making small profit; it is too hard to get over the hump (of the investment curve); entrepreneurs feel they are destined to be small. If entrepreneurs fear that they cannot even invest, and consequently that their businesses might fail, then education for their children is not even a question. The next generation is without talents, skills, or anticipation for a brighter future. I find this to paint micro-finance in a realistic light, and show that stable and higher wages, and the implementation of "better jobs," for even unskilled workers can help the world economy.

"Black Sheep" was a beautiful story delineating the rise of an internet company from the life of a poor Indian. We can compare our privileged lives to the narrator, but we realize that both he and I, "both read the same newspaper I read...have one breakfast..have stress.." We can take his story and relate it to the problems we have in our lives. The narrator grew up in domestic violence, with both an abusive father and a mother whose generation of women felt dependent on the husband. The narrator was the "black sheep," the exception, that in actuality, proved to be "watched with greater care." It is because the narrator worried not about numbers, about the top rank in the class, the absence of intrinsic value of money, even denying a bonus of 16 rupees. The narrator states that if we all are mentally hurt or disturbed in some way, we can become the "black sheep" and reject the status quo.

One of the points from the reading “Reluctant Entrepreneurs” that resonates with me is how Ben Sedan insisted that he did not need a microloan, and was not open to change because he was convinced that his family would not have the means to expand their business. It is not as if Sedan didn’t want the best for his family, or that he wasn’t willing to put the work in. He just wasn’t aware of the possibilities that could arise with thinking about business differently. This is where Al Amana and other organizations become so crucial in not only identifying entrepreneurs, but also connecting with them on a deeper level than just providing capital.

This brings me back to one of the points I had made in an earlier blog: education is so key to allowing people to realize what opportunities are available to them. It seems as though in certain cultures, people are accustomed to being humble and not taking more than they need, and they transfer these personal values to business as well, which is a contrast to the capitalist system in the United States, where we often see greed as a prevalent driver in business.

The idea of being poor because one is not intelligent or resourceful is simply not true, and this is where our other reading, “The Parable of the Black Sheep,” comes into play. The author states that as a twelve year old, he thought that people were poor because they just “let themselves be.” People are not poor because they do not want to change, or are comfortable in their situation, as it may seem from a child’s point of view. They are poor because they do not see a way out, and often do not have the means, the support, nor the knowledge that is necessary in order to catalyze a change.

I really enjoyed the personal narrative of this reading, because it makes everything, especially the lessons presented, much more real and universally applicable. I liked that the author encourages young people to challenge the status quo, which isn’t very common in the school system here in the United States, where a lot of the time, teachers just follow standardized lesson plans, and there is little room for questioning, participation, or hands-on experience on the part of the students. This is where creativity is muted, and new ideas are often stifled because kids do not learn to think for themselves. Thus, we can all make an effort to think outside of the box, regardless of whether we are living in poverty, to achieve more.

I believe that “The Reluctant Entrepreneurs” was very in-line with a great deal of the themes we have discussed thus far in our class. Many of the readings we have had so far deal directly with the ways that small movements in the global community can create gigantic returns, particularly for the people at the very bottom of the economic pyramid.
I have said this in previous blog entries, but I still find it very empowering that people can take their stories of living in the gutter and really make something amazing. For instance, Xu Aihua went from advertising garment-making classes via megaphone in the town square to sinking $4.4 million on a piece of real estate because she “had some money lying around.” However, the more I read these fantastic rags-to-riches stories, the more I can’t help but think about the millions more who aren’t mentioned in fair trade and entrepreneurship books who honestly haven’t received the same opportunities as the people who have hit entrepreneuiral gold, so to speak.
Although, just as a programming note, I believe that in the future, I would like to get a wider variety of readings, as many of the assignments we have had in the past few weeks primarily deal with these success stories of people who have economically flourished as a result of fair trade. While I think that these readings have been inspiring, I would like to have a bit more of a wider scope related to the process behind fair trade. Personally, I think it would be more interesting to not just hear about the success stories in fair trade, but also to hear about other facets of the fair trade industry, such as the basic history of the fair trade labeling process, the steps it takes to get something certified, etc.
Overall, I had quite a few conflicting emotion on “The Parable of the Black Sheep.” I find that the piece was a strange choice for this class, considering the author seems to shame the poor for a good deal of his article, to the point where he starts off the piece saying that the poor “love” poverty and cannot stop their pursuit of it, a concept I find a bit ridiculous. Unless the poor have a serious case of self-sabotage, I find it difficult to believe that such a wide margin of people just enjoy a harder lifestyle simply because they to do not pursue any other alternative. The more I think about it, the more I assume that the article was presented as a counterpoint to the more people-centric views we’ve evaluated so far, but I just felt that for someone who was born into poverty, he should have been more thankful that he was able to rise above his less-than-stellar surroundings.
That being said, I do think that it was very encouraging that he was able to supersede his living situation and become one of the richest men in India amidst the Silicon Valley boom of the early 2000s. However, I think that rags-to-riches stories are far more inspiring when the protagonist understands how serendiptious his or her chances were in rising above the incredible limits of a difficult system, and his attitude was a bit disappointing.

It is great what these people were doing in "Reluctant Entrepreneurs". They were giving these people that second chance, or actually, that one chance they needed to start their business. The system they created was very well thought out. They took the time to actually explain the concepts of loans, the very things they are giving away, which showed that they did know what they were doing. The results even show for themselves as people were actually gaining profits from what they have started/created from these loans, and of course the lenders are getting their cake and more.

"The Parable of the Black Sheep," does open a whole new perspective on those who are impoverished. It states of these people settling where they are. This whole idea of "people loving poverty" is something that I can't accept. It seems almost hypocritical at some point. If people are happy when they are poor, why is it that they always complaining when something inconvenient comes their way. And what is worse is that these people feel that they have become the victims of these situations they are currently in, which prevents them from really taking those next steps to get out of these situations. I feel as these people do not have the right to say that they are stuck in poverty, when it is definitely possible to get out. It may not be easy, but it is definitely possible.

What I can gather from these readings is how unfortunate it seems that these people feel like they cannot take the next steps to move forward. In the "Reluctant Entrepreneur" Sedan's main goal was not to have a successful business, but rather a business that was able to manage on. In the "Black Sheep" these people feel as if they cannot move out of their unfortunate situations. It seems to arbitrary.

In the "Reluctant Entreprenuers" what I found most interesting was how high the interest rates were for micro finance loans. Many of these people are paying over 5 percent interest on their loans, however many of these people are still paying the interest back on the loans as well as still making profit from their entreprenuership projects. Others however are never able to really expand their businesses and achieve large scale success because they can't cross the threshold of making enough profit to clear their loans while investing in their own business.

This tells me that if these entreprenuers had the right resources and investment they could really change their situations. The reason that we look at entreprenuers as a huge part of the american economy is because many people in America start out as small business owners and expand, creating jobs and revenue for our country. They are able to do this by getting reasonable loans and making smart business choices. This could happen in other third world countries and it is happening as we speak. Micro finance can help achieve this as long as it remains true to it's intial goal of helping poor people start businesses and dosen't abuse the system.

The "Black Sheep Parable" was not a reading I was paticulary fond of. I found that the author was somewhat arrogent and self satisfied with his success. For the first half of the reading he simply told his story in a way that you can tell he wanted you to feel bad for him and understand why he is so much better for being a sucess. I thought it was interesting that he talks about being poor and having little hope to get out of poverty but that dosen't make sense to me. At the same time he told us his father was a professor at a university and his mother had wealthy parents. He also talked about seeing other kids in real poverty and thinking that they wanted to be in it. This tells me that rather he was more of a working class-middle class kid growing up with domestic violence. I'm not saying his life wasn't hard but I think he tried to overexaggerate his difficulities.

I wouldn't care if he exaggerated in his story if it wasn't for the fact that he has, what I find, to be a arrogant view of how to get out of poverty. He thinks that if everyone that is born into poverty just acted like him they could be rich. This is clearly not true. This guy had a educated father, and a mother who pushed him to well in school. He also attended a private school for his early education, thus he had so much more oppurtunity already than most kids born into poverty. Additionally he was top of his class for most of his years in school, not everyone has the intelligence level to be top of their class. I just think that he assumes too much about people in poverty and how difficult it can be to get out. Many people never get the oppurtunities that he did and many people have tried and worked very hard to get out of poverty but just havn't had the same luck.

This week we read "The Reluctant Entrepreneur", which brought up the point why some people in developing countries do not invest in micro finance loans. The article pointed out that the main reason poor people are "reluctant entrepreneurs" because of their complacent culture. This idea is much different from most western cultural philosophies, which instill that people should do what they can to improve their lives and attaining all of the success they can. Unfortunately, in the article we learned that most people are unwilling to take the loans because they are fine with living their day-to-day lives by only just getting by with what they need. I found this very difficult to understand because these people have the opportunity to grow and achieve greater things but do not because they are so risk averse.

The other article we read was "The Parable of the Black Sheep", which described the author's point-of-view on how to achieve great things from the most difficult and trying times of our lives. The author seemed arrogant throughout the entire article but also explained the need for the recognition of the individual. I found the idea the author brought up, which stated "the best things come from the most negative points of your life." I found this to be very true because it seems that we learn more from failures than we do from successes. I feel like this idea also goes hand-in-hand with the authors need for us to have self-awareness because we tend to learn more about ourselves as well as others in times of need, as opposed to when everything is manageable in our personal day-to-day routines.

While the second article was more engaging to read; I found that I am definitely learning more and more abut myself and my understanding of fair trade throughout the entirety of this course and these different articles.

This was an interesting reading assignment. It touched on several other readings that we had read so far that dealt with giving an opportunity to the poor in order for them to be able to provide for themselves and their family. While reading this chapter I felt that it kind of gave us a lesson partially on the microfinance of a business. It give examples on the difference of marginal return versus overall return. Abhijit V. Banerjee explains why even if you give money to the poor that they often do not make enough money to keep a business running. Most of their income will go to overhead and expenses. There were several examples given that I find that made the reading a bit easier to understand. One example was of the storekeeper who built shelves in her home however did not have enough money to buy inventory to fill the shelves. She received a loan from her mother and she was able to fill her shelves with things that the village kids will like and buy. She was able to make money but it still wasn’t able to cover the cost for her time and building the shelves and the counter. When she was able to secure a loan for greater amount she was able to make enough to keep her in business.
Another example that was given was of the smart student of china (Xu Aihua), she was able to recruit some 100 students for $15USD and from those students she stood with 8 students which she believed in and she was able to make enough money to buy 60 automatic sewing machines. Those sewing machines was able to make her business grow and what is even more amazing is that she sells garments to Macys, JC Penney, etc. She was able to make her own investment in real estate for $4.4 million USD. That’s incredible in itself.
The articles touches on the reality of the poor and their businesses and how it is difficult for them to continue because there is no versatility and everyone is attempting to sell the same thing in poor villages. One example of this was the woman who were all attempting to sell “Dosas” which are rice and lentil pancakes. The woman are selling them same thing and time is wasted because they are competing against themselves.

Lastly, but definitely not least when they were conducting the surveys about good jobs to the poor, most of them chose to have their children work in government jobs. To me this is an indication that they want their children to have a long term job, be secured and not worry about living poor. As in the beginning of the reading when Ben Sedan was fine when he stated his family did not need anything because he son who had trained as a nurse and worked as a paramedic in the army. He was content to living the same way he has been living with no other mindset. Overall, this was a long but interesting read.

From the Black Sheep Parable I think he said it best when he was having a conversation with his mother: "For you, my career is driven by my need to earn money to support my family at home. For me, my career is driven by the experiences I want to gain". I feel exactly the same way, life can be hard if you choose to make it hard, even though I know that unfortunately some do not have the choices and others think that they do not have choices and they choose not to do anything. But life is an experience and filled with experiences, it is what you do with that experience that will determine who you are and who you will become in life. I connected so much to this reading and especially when they were discussing about money when the journalist asked him: You are the richest man in India, How does that feel? His response was one in which I would give if I was found in that situation. Me: We are equally alike, no difference, no amount of money in the world can change who I am, for I am myself and I come from the same world you do, breathe the same air you breathe and I am just happy to be me. Humble!

The reading “Reluctant Entrepreneurs” was an interesting one. My favorite quote from the reading was: “Use your ingenuity to create something out of nothing.” I think this is so true of entrepreneurship, especially in the case of these people with very little. If you use your creativity, you can come up with a simple entrepreneurial idea to support yourself. For example, the article had one story where the women would go to the seashore and collect the wet sand. They used the sand later to scrub and clean dishes. This is great idea to make “something out of nothing.”

Another idea that many of us overlook when it comes to fair trade or poverty is that many are forced into entrepreneurship as the only means of survival. They have to come up with an idea or create something to support them selves. They barely get buy, many poor entrepreneurs in developing countries, and they want nothing more than to get out of their position.

“The Parable of a Black Sheep” was an interesting read, very different from any we have read before. Seeing how this man pulled himself out of poverty and become a multi billionaire in India is pretty amazing. This connects to the point that often times people who have gone through hardship and have struggled can do wonderful things later, because life’s obstacles make a person stronger and capable of great success. Stronger people will not give up as easily as others might in an entrepreneurial venture or in any other challenge in life.

One quote from this reading that really struck me was: “Domestic violence thrives in areas where women don’t know what they’re capable of.” This quote makes a great deal of sense to me, but it also makes sad. Women born into this position in India accept this and know they have very few rights and the ability to move up in society and provide for themselves. They know nothing different, so the majority stays complacent and goes about making just enough money to get by and accepting abuse from men in many cases. If they knew there is a way out, it could change their lives. This is why fair trade organizations are so wonderful, because they can give women a place to go and work. They gain skills and confidence, which enables them to make change in their own life.