March 21, 2012
CEME Fellow Nicholas Sullivan co-authors new book on M-PESA
CEME Senior Fellow Nicholas P. Sullivan has co-authored (with Tonny K. Omwansa) Money, Real Quick: The Story of M-PESA, published by Guardian Books this year. The book focuses on Safaricom’s M-PESA mobile-money network. M-PESA, which counts nearly 13.5 million Kenyan users – or around 70 percent of the population – is an e-money innovation that allows customers to send money electronically to family and friends via text message. Sullivan and Omwansa also explore how the growth of M-PESA has spawned a brand new financial services ecosystem in East Africa with startups and incubators, the beginnings of a Swahili Silicon Valley.
Sullivan is also author of You Can Hear Me Now: How Microloans and Cell Phones Are Connecting the World’s Poor to the Global Economy (Jossey-Bass, 2007), which focuses on entrepreneurship and innovation in developing countries, and publisher of Innovations: Technology/Governance/Globalization (MIT Press).
Read more about Money, Real Quick: The Story of M-PESA here.
March 7, 2012
CEME Fellow Weiping Wu to publish The Chinese City
CEME Senior Fellow Weiping Wu, a professor of urban and environmental policy and planning at Tufts University, has completed a new book (co-authored with Professor Piper Gaubatz) entitled The Chinese City, to be published by Routledge this summer. The Chinese City fills a critical gap in current scholarship related to the rapid and complex process of urbanization in China, taking a unique spatial science approach (with a focus on geography, urban studies, urban planning and environmental studies) in comparison to the much more common political and economic approach taken by the majority of researchers. By grounding the research in history and geography, The Chinese City also provides a counterpoint to the largely Eurocentric approach in much of urban theory.
A respected urban specialist and China scholar, Professor Wu has served as a consultant to the World Bank, a fellow in the Public Intellectuals Program of the National Committee on United States-China Relations, and a research fellow at the Brookings Institution.
Read more about The Chinese City here.
February 15, 2012
Inclusive Finance-Focused Issue of MIT’s Innovations Journal Features CEME Program Research
As an outcome of CEME’s Fletcher School Leadership Program for Financial Inclusion, a special issue of Innovations: Technology, Governance, Globalization (MIT Press) released in February 2012 features policy memos written by four of the central banker program participants and a lead article by CEME Senior Fellow Nicholas Sullivan. The issue, focused on key topics in the field of inclusive finance, explores the role of regulators as change agents, the consideration of mobile money as a utility, and the impact of mobile money on financial inclusion.
Access the Journal here.
January 23, 2012
CEME Fellow Amar Bhidé Calls for Sensible Finance in a Dynamic Economy
Throughout his career, Professor Amar Bhidé has been interested in the interface between the social sciences and business with a focus on innovation and entrepreneurship. His most recent book, A Call for Judgment: Sensible Finance for a Dynamic Economy published in 2010 by Oxford University Press, analyzes the recent economic crisis and calls for a balanced set of reforms that recognizes the failure of “quant-centric” finance in which mathematical algorithms come to replace the on-the-ground and personal judgment of mortgage lenders and investors. Bhidé argues that this "inappropriate replacement of human judgment" has distorted the financial services industry, leading to a very precarious house of cards that could again come crumbling down as it did in 2008. Bhidé’s analysis comes at a critical juncture in financial decision-making, providing a new roadmap for thinking around the how the financial services sector should be conducted.
Bhidé is Thomas Schmidheiny Professor at The Fletcher School. Bhidé joined Fletcher after teaching at Columbia, Harvard, and the University of Chicago. A former Senior Engagement Manager at McKinsey & Company and proprietary trader at E.F. Hutton, Bhidé served on the staff of the Brady Commission which investigated the 2008 stock market crash. He has published widely in the areas of strategy, finance and firm governance and written numerous articles in the Wall Street Journal, The New York Times, and the Financial Times. Bhide is a founding member of the Center on Capitalism and Society and spearheaded the launch of the eponymous journal Capitalism and Society (published by the Berkeley Electronic Press) which he now edits (with Professor Edmund Phelps). He is also a member of the Council of Foreign Relations and a fellow of the Royal Society of Arts (RSA).
Read the complete profile of A Call for Judgment: Sensible Finance for a Dynamic Economy here.
January 12, 2012
CEME Fellow Jorge Antonio Chan-Lau Discusses whether Frontier Markets are Punching Below their Weight
Are frontier markets the next emerging markets? And if so, should global equity investors include them in their portfolios? In his recent paper (December 2011), Frontier Markets: Punching Below their Weight? A Risk Parity Perspective on Asset Allocation, Jorge Antonio Chan-Lau explores how investors could benefit from a frontier markets allocation well in excess of the market weight of the asset class. According to Chan-Lau, a risk parity portfolio tends to outperform a market cap-weighted portfolio during periods of positive equity returns while delivering comparable returns during crisis periods. Even if portfolio managers could not follow a risk parity asset allocation strategy due to benchmark tracking considerations, overweighting frontier markets could help them outperform their benchmarks during upside periods without increasing downside risks significantly.
Chan-Lau is a CEME Fellow and a senior economist at the International Monetary Fund, where he is a lead contributor to analytical and policy work on financial stability, risk modeling and capital markets, areas in which he has published widely. During 2007-08 he was on leave as a senior financial officer at the IFC, The World Bank Group, where he managed a frontier markets local currency loan portfolio, for which he designed and implemented the valuation and economic capital allocation models.
Read the full paper here.
October 28, 2011
MasterCard CEO Offers Vision of a “Cashless Society”
Shortly after his appointment as CEO of MasterCard Worldwide in 2010, Ajay Banga declared a “war on cash” and signaled a strategy shift for a company that was struggling to gain market share in a competitive industry. By making major investments in non-cash payment systems in emerging markets such as India, where as many as 600 million people do not have bank accounts, MasterCard has positioned itself to grow by enabling people around the world to shift from traditional cash payments to non-cash payment systems and avoid the “cost of cash.”
In a recent visit to The Fletcher School, Mr. Banga participated in a roundtable, fielding questions from Bhaskar Chakravorti, Senior Associate Dean of International Business and CEME Executive Director, and Kim Wilson, Fletcher Professor and CEME Senior Fellow, about the opportunities and challenges of moving away from cash in favor of alternative payment options. While clarifying that he doesn’t “think we can ever get to a purely cashless society,” Mr. Banga suggested that the current ratio of 85%: 15% cash: payment systems needs to improve, citing the various physical (printing, storing, etc.), convenience (online retailing), and facilitation (tax collection, cross-border illegal activity) costs of cash use: “The cost of cash is misunderstood by everyone.”
Watch an excerpt of his talk here:
Read the complete event summary here.
October 11, 2011
Chris Hummel (F93) of Siemens Enterprise Communications Shares the Secret to His Success: “Managing the Matrix”
At one point not long ago, Chris Hummel’s biggest concerns were how to find fax paper in Almaty, Kazakhstan, and why his Kazakh business partner insisted on walking arm-in-arm with him. Now his days are filled with worries about marketing and managing the latest evolution for global electronics giant Siemens in North America.
It’s a winding career path that took him from Fletcher graduation eighteen years ago to the top levels of a $3 billion company. And if there’s one secret to his success, it’s what he calls “Managing The Matrix,” or knowing how to manage multiple, complex agendas simultaneously.
“Most people do not know how to manage that skill…. Most people do not know how to manage multiple executives or solve multidimensional, cross functional business problems,” he said during a lunchtime presentation October 11 at The Fletcher School, the latest in a series hosted by the school’s Institute for Business in the Global Context.
“If you can master that skill, there’s no stopping you.”
Read the complete event summary here.