Every year in December I buy «The World in Figures», a small book published by The Economist with statistics on more than 190 countries around the world. Focusing on Italy there are two issues worth mentioning. The first one made me laugh, the other one did not. The first one is about the consumption of Marijuana, also called Ganja or, more commonly, Cannabis. According to those data, Italy is the country where we consume more marijuana in the world. And that (if I have to be honest) surprised me.
I stopped laughing when on page 62, inside the «Enterprises: Creativity and Research» chapter, I read the entrepreneurship’s ranking, (a ranking focused on the percentage of entrepreneurs between the ages of 18-64). In this ranking Italy is at the top for countries with the lowest rate of entrepreneurship. Not one of the countries with the lowest rate of entrepreneurship but THE country with the lowest rate. To be clear, according to this ranking, Italy is the country with the lowest number of emerging entrepreneurs. If we add this fact to other interesting data included in the book (like, for example, global competitiveness or entrepreneurial ecosystem, where Italy is not even in the ranking) my smile disappears forever.
I had already talked about being an entrepreneur in Italy here, however, these data lead me to two new thoughts. 1) The first one is about our economy, which has always been based on SMEs, small and medium enterprises. These enterprises are nowadays disappearing due to lack of investment in research and development and a consequent loss of productivity of our companies. During the glorious thirty years (when the Italian GDP used to increase at 50% – compared to 2% or even less today), many craftsmen became entrepreneurs and founded some of the most important Italian companies. In those days, however, the path from the lab to the company was easier (less bureaucracy, less technical knowledge…). Nowadays instead becoming an entrepreneur requires education, training and research. And that in turn requires investments.
2) The second one is about Italy’s economic future. In their book «Why Nations Fail» Daron Acemoglu and James Robinson, apply insights from institutional economics, development economics and economic history to answer why nations develop differently, with some succeeding in the accumulation of power and prosperity, while others fail. The ones that succeed are governed by inclusive systems, open societies, with mobility from the bottom and a continuous renewal of the elite. In extractive systems (autocracies) instead, entrepreneurs and citizens have no incentives to invest in and work on innovations, which are necessary to create prosperity, because the ruling elites are afraid of creative destruction. In this context, emerging as an entrepreneur is very difficult because those who have been successful, thanks to an inclusive system, tend to stifle those who come after them, creating a stagnant situation where no potential entrant, as Porter put it, can threaten their success, but where, on the other hand, no new enterprises have the opportunity to grow. And that explains another figure included in the book «The world in figures»: the absence of Italy from the rating «foreign direct investment (FDI) inflows».