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Global Empowerment Meeting 2009
New Date: Thursday September 17, 2009
Each year, we convene a private event that brings together the world’s top policy-makers, business leaders, and development experts focused on extending the reach of markets to the economically disenfranchised. This year’s meeting features three themes: the impact of the global economic crisis on underserved financial markets, regulatory imperatives to improve global provision of financial services, and emerging technologies to create immediate market opportunities. Hosted by the CID’s Empowerment Lab with support from the MPower Foundation.
CID Empowerment Meeting Focuses on Financial Access for Global Poor
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More than 50 top entrepreneurs, scholars, nonprofit leaders, government officials, and other thought leaders convened September 16-17 at the John F. Kennedy School at Harvard University for the second annual Global Empowerment Meeting hosted by The Empowerment Lab at the Center for International Development (CID). Established with a seed grant from the MPOWER Foundation, The Empowerment Lab focuses on research to promote economic inclusion, finding sustainable ways to empower the global poor by providing access to key markets.
The 2009 meeting focused on opportunities and challenges for financial empowerment in developing countries, with the goal of extending markets and financial services to more than two billion people who are currently unbanked or under-served. Participants participated in panels and roundtables on financial access, savings, regulation, and technology, cutting across the private, public, and nonprofit sectors.
The keynote address was delivered Sept. 16 at the Harvard Faculty Club by Dr. Andrés Velasco, Minister of Finance, Chile, and a former professor at Harvard Kennedy School. Ricardo Hausmann, HKS Professor of the Practice of International Development and Director of CID, moderated the Sept. 17 meeting, which included a luncheon keynote featuring Dean David Ellwood of the Harvard Kennedy School and Lant Pritchett, HKS Professor of the Practice of International Development.
"Inclusion in a market economy is a crucial component of individual economic welfare," commented Suzi Sosa, MPA/ID 2001 and president of MPOWER Foundation. "More than two billion people around the world lack access to basic financial services. There is no way we can hope to solve the problems of empowerment and financial inclusion without research into the systemic causes. But that research would be futile if it is not disseminated to the world. That's why we bring policymakers, academics, regulators, and entrepreneurs into one room together."
Sosa added, "The Empowerment Lab is not just about financial empowerment. Our vision is for the Empowerment Lab to address issues of health and empowerment, gender and empowerment, education, civic engagement, and empowerment."
Technology and regulation were key themes for this year's event, as well as a discussion on the effects of the financial crisis. Participants agreed that progress in the area of financial regulation could have a powerful effect on improving access for people not currently using banking services. Regulation of financial products and services -- including laws surrounding consumer protection, privacy, and lending -- can also limit access to financial products and have counterproductive effects. Participants sought solutions that enhance access for individuals while maintaining financial prudence for institutions.
Providing a broad perspective on how countries develop, Hausmann presented research on product space networks, in which countries grow by upgrading from current export products to other, usually more sophisticated, related products. "At CID, we're interested in why some countries are poor, some are rich, and how the poor can become rich," he said. "If you think in this paradigm about how a country develops new capabilities -- and how to leverage those capabilities with other countries -- it offers answers of how nations make that leap to development."
Roy Sosa of MPOWER pointed out how this macro analysis can be applied at the micro level, as small retailers innovate to expand their businesses, developing new capabilities. For instance, small business owners in developing countries may expand from standard retail shops into serving as access points for mobile technology, mobile banking, and other services that empower their customers.
The technology discussion focused on the opportunities created by the explosion in product innovation and rapid penetration of mobile technology in previously remote areas. The growth of technology creates opportunities for digital banking, mobile purchases, and transactions beyond the financial sector in health interventions and mobile education. The adoption of mobile phones has also created a rich store of digital information regarding markets, networks, and individual behavior. Researchers and policymakers are wrestling with questions regarding privacy, property rights to information, and ownership of and access to mobile applications that people can use to change their lives.
Academic participants at the meeting included Asim Khwaja, Associate Professor of Public Policy, Harvard Kennedy School; Rema Hanna, Associate Professor of Public Policy, Harvard Kennedy School; Iris Bohnet, Professor of Public Policy, Harvard Kennedy School; Dr. Julio Frenk, Dean, Harvard School of Public Health; Peter Tufano, Professor, Harvard Business School; Shawn Cole, Associate Professor, Harvard Business School; Yale Professor Dean Karlan; Andrew McAfee, MIT Center for the Digital Age; and MIT Professor Sandy Pentland.
Global Empowerment Meeting 2008
September 22 - 23, 2008
Harvard University Cambridge, MA
Academics from Harvard and Yale discussed the importance of partnering with private sector firms to test research questions in many contexts. Harvard Business School's Nava Ashraf discussed her latest partnership with a large Salvadoran bank to study how offering US-based migrants from El Salvador the opportunity to control what the remittances they send are used for. Harvard Business School's Shawn Cole is partnering with banks in India to offer farmers weather insurance. Yale's Dean Karlan discussed several studies that demonstrate the importance of framing and marketing in producing products that appeal to underserved markets, and Harvard Kennedy School's Asim Khwaja discussed his use of psychometric testing to identify promising entrepreneurs in South Africa.
Several entrepreneurs who are taking new approaches to providing financial services to underserved markets discussed their business models. Asheesh Advani discussed how Virgin Money USA brings formality to informal lending between family and friends, and Carlos Danel talked about how Compartamos Banco maintains the high-touch client relationships of its NGO roots while serving over one million clients profitably.
Other entrepreneurs focused on leveraging new technologies to increase financial access. Roy Sosa discussed how MPOWER Labs is building a portfolio of financial services companies that include mobile phone-based payments and money transfers. Rolando Salcedo's Platamóvil is creating a mobile payment and transfer platform in Colombia that will work for all mobile phone providers and with both informal and formal sector vendors. Tim Vang showed the audience MYC4's web platform for person-to-person lending, which raises capital for entrepreneurs in Africa.
Mindful of the role government can play in fostering inclusion, the audience heard from Chile's Minister of Finance Andres Velasco on the role of markets in the public policy sphere, and from former mayor of Medellín, Colombia on their efforts to foster entrepreneurship.
Northeastern University's Albert-László Barabási spoke about new ways of looking at large datasets on everything from monkey movements to mobile phone users. To this end, the Empowerment Lab is creating a secure data warehouse that will make a wealth of information about consumer behavior available to Empowerment Lab researchers who focus on extending the frontiers of financial markets.
By fostering these types of cross-sector collaborations at events like the Global Empowerment Meeting, the Empowerment Lab leverages the strengths of its partners and is able to provide new answers to old questions about how to make markets accessible to all.
Presentations
Ricardo Hausmann
Nava Ashraf
Shawn Cole
Dean Karlan
Asim Khwaja
Albert-László Barabási
Photos/Quotes [forthcoming]
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© 2008 by the President and Fellows of Harvard College.
