One nice thing about the book is that it gives sympathetic economic context to some of these issues, humanizing what might otherwise seem like utter fraud. Briefly, it's a combination of:
- inevitable human motives when faced with a chance to escape poverty
- different cultural expectations about what it means to deliver on a manufacturing contract (i.e. does it have to always be exactly to spec, or can it just be roughly equivalent in the important ways)
- different cultural focus on surface appearances vs. less visible qualities
- information asymmetry between local operators and distant foreign counterparties
- greed on the part of foreign counterparties, which the Chinese manfucaturers exploit to get deals and then ruthlessly trim back everywhere they can get away with, backing off only when they push too far and get called on it
What's almost as interesting are the similarly misaligned incentives within the foreign counterparties. Western capitalist companies are unabashedly greedy, short-term (gotta make the quarterly numbers), share-price-oriented, and have all their own dysfunctions as a result. That's not to say the kickstarter guys are guilty of any of that -- just that there's plenty of parties trying to screw the other on both sides of this international dynamic, and finding a truly honest partner is difficult in business anywhere.
- inevitable human motives when faced with a chance to escape poverty
- different cultural expectations about what it means to deliver on a manufacturing contract (i.e. does it have to always be exactly to spec, or can it just be roughly equivalent in the important ways)
- different cultural focus on surface appearances vs. less visible qualities
- information asymmetry between local operators and distant foreign counterparties
- greed on the part of foreign counterparties, which the Chinese manfucaturers exploit to get deals and then ruthlessly trim back everywhere they can get away with, backing off only when they push too far and get called on it
What's almost as interesting are the similarly misaligned incentives within the foreign counterparties. Western capitalist companies are unabashedly greedy, short-term (gotta make the quarterly numbers), share-price-oriented, and have all their own dysfunctions as a result. That's not to say the kickstarter guys are guilty of any of that -- just that there's plenty of parties trying to screw the other on both sides of this international dynamic, and finding a truly honest partner is difficult in business anywhere.