Big Lessons from Small Nations
[Music]
when we think about what the future
might look like
we usually think about the impact of
climate ai
and aging societies but how often do we
think about the future of nations
here is a view of the earth from outer
space a world without
political borders now we see changes in
national borders since
1800 we take for granted that our
countries are stable
even permanent but history shows us that
they’re
in fact prone to change more often than
we think
what causes borders to change what
determines the size of nations
over the next few minutes i will attempt
to show nation formation has changed
significantly
in favor of smaller more socially
cohesive nations
and that they’re pointing the way by
their positive example towards maybe
even a superior model for our futures
so let’s get started
for most of history prosperity was about
conquest
a country’s status and power has equated
with size
its territorial reach natural resources
military might tax base size of its
domestic market
smallness was associated with weakness
inability to act even a question about
surviving
this bigger means better mindset
encourages empire building
think of alexander the great the roman
empire
napoleon or stalin the british empire in
1911 was the largest empire in history
yet at its peak it controlled only 25
percent
of the world’s population at some point
the advantage of expansion ceased
otherwise we would have experienced the
united states of the world
it turns out that the cost of social
cohesion at some point
outweighs the benefits of scale
different languages
ethnicities social norms
distances my first thesis
is that modernity has radically altered
the formula of nation formation
the advantages of size have declined
considerably
commodities and capital intensive
they’re unprofitable
and environmentally damaging so who
wants them
militaries are costly and often lead to
conflicts
economic power in fact is decoupled from
size
in a knowledge-based economy its
innovation and talent
matter nimbleness is now essential to
adapt to a world of accelerating change
think back 20 years ago we didn’t have
google maps tesla airbnb
bitcoin spotify the sweetest music
streaming company
didn’t exist 20 years ago either its
most successful market in the world is
chile with a market penetration of over
60 percent
but spotify doesn’t even have a company
in chile
nor does it employ one worker there the
cost of shipping has declined 80 percent
since 1940 for products sold over the
internet
like spotify’s the cost of distance is
zero so the world is shrunk
and meanwhile it’s changing faster by
the day
societies are losing their social
cohesion think of brexit
trump chilejon wherever we look there’s
a declining emphasis on marriage
families religion and communities
and the emergence of identity groups
across sexuality
gender race even generation
with narrow and confusing categories
like x y
and z there’s more emphasis on me
and less on we and think of the single
to noise ratios the rise of fake news
social media platforms such as facebook
instagram and google
that are designed to maximize our
attention not improve our understanding
taken together the declining value of
size
and the increasing cost of social
cohesion means that smaller more
cohesive societies have distinct
advantages
so we may witness the emergence of more
of them but this is really not new
it’s happened before denmark is a tiny
fraction of itself
compared to what it was in the 16th
century the british empire morphed into
the commonwealth
and then the united kingdom who would
have thought five years ago
let alone 50 years ago northern ireland
would consider uniting with ireland
economies of scale is economics what
gravity is to physics
the notion that greater efficiency comes
with greater societies
here is what we would expect to see if
there were a close relationship between
the population of a nation
and its ability to produce wealth in
this instance
gdp per capita but in reality there is a
weak almost random relationship when one
studies the data across all nations
meaning that size doesn’t seem to matter
at all
what merges instead is a cluster of
small outperforming nations
outliers as they say in statistics
switzerland
ireland singapore sweden
denmark finland the netherlands and
israel
big things come in small packages nine
out of ten of the most competitive
nations in the world have populations of
less than 20 million people
15 of the top 20 nations ranked by the
united nations human development ranking
or small countries
11 of the 15 per capita income
all the 10 countries ranked in terms of
happiness are small countries
a similar pattern emerges when we look
across a number of importance
performance metrics inequality
equitable treatment of whitman
confidence in government
co2 emissions singapore for instance
spends the least amount per student on
education
but achieves the highest pisa scores the
dutch have the best pension funds in the
world
according to rankings by mercer
their success is due to excellence not
clout
these nations what i call s8 nations
achieve twice the level of
competitiveness as their g20 or large
counterparts
what’s interesting is that their
outperformance is accelerating
just at a time when the larger nations
are declining
despite throughout performance s8
nations lacked voice among multinational
institutions
such as the united nations imf or the
world economic forum
participation and leadership in such
forms has traditionally been based on
power
rather than excellence but wherever we
look it seems difficult being in larger
nation these days
hardly a day goes by when yet another
doomsday scenario is put forward
so much of what we read and hear is
about failure
rather than success but progress
throughout history
has always been about finding something
that works in reverse engineering
whether it was the wheel or the iphone
ironically many of the solutions to our
problems are already here
we just need to look over the garden
hedge to find them
and here are a few examples copenhagen
is well on its way to becoming the first
carbon neutral city in the world by 2025
in good part because it has replaced
cars with bicycles
here is a major thoroughfare in
copenhagen in 1970 compared to
today the danes have taught us what it’s
like to live
at three kilometers per hour
israel leads the world in eradicating
covet
it has the highest per capita number of
vaccinations in the world
head and shoulders above any other
country
finland’s new prime minister and
majority of cabinet are women
in their 30s new zealand passed the law
last year called naked produce
preventing the sale of fruits and
vegetables in grocery stores
if they’re wrapped in plastic hence the
name naked
why are more innovations coming from
these smaller nations
well in the first case they’re more
exposed to exogenous forces so they must
be more adaptive
and they’re more inclined to experiment
the greater social cohesion means
they’re better able to deliberate
complex issues
and intermediate social consensus their
vulnerability
makes them more modest
it is in fact this vulnerability which
forces them to be proactive
rather than reactive and thus arrive in
many instances of the future first
their journeys are unique and they
provide us with a different framework
and they may even point us towards a new
order one more suited for the futures we
are about to face
let us compare the world will likely
grow slower in the future
as societies realize that growth cannot
be infinite
with finite resources we should focus
more on
quality and less on quantity more on
resilience
and less on growth advancement based on
merit rather than privilege
leads to more productive and fairer
societies
confrontation throughout history has
been costly
and seldom leads to shared and lasting
agreement
in several critical areas such as
climate debt
and pensions postponement of
gratification
even if it requires sacrifice leads to
superior
more sustainable outcomes kicking the
can
is a strategy destined to lose
to realize this smaller successful
nations have adopted
different social architecture not one
focusing on left versus right
or throwing bricks at each other or one
where more government
less markets or more free markets and
less government
but a new order based on more free
markets and a better government
yes free markets are effective across a
wide spectrum of our needs from paper
clips to teslas
but free markets cannot solve climate
pandemics
immigration or obesity for this we need
better governments and common problems
such as climate and pandemics require
shared solutions
so governments need to work together
more effectively
we’re all in this boat together whether
we like it or not
there is no time to waste our futures
will be very different to our past
also more challenging societies will be
confronted with an
unprecedented series of stress tests
could we have another pandemic or could
covet mutate
what about the climate there is no
planet b
100 year lives were a mathematical
possibility 20 years ago
but now a distinct probability
towards this end we started a new
initiative called s8 nations
it’s based on the following thought
experiments
imagine bringing together the world’s
most impactful people
from the world’s most innovative and
collaborative nations
and putting them in a room and asking
them to come up with bold solutions
a group that seeks out and recognizes
the best practice
irrespective of its origins and then
provides a good housekeeping seal
to encourage the proliferation of
progress
based on excellence not on power
we need to reimagine the world we need
to dare to see our lives in a wholly
different light
what can we learn from other societies
are we doing our best
if my talk is nudge you towards seeking
answer to these questions
i consider it a success i’m james
broading
co-founder of s8 nations thank you
you