This course provides a framework for studying the role of the private sector in international development, and risks, challenges and opportunities that loom large in developing countries for private sector actors. As the globalization of firms continues apace, BRICS countries account for a steadily increasing share of the world economy and the business climate improves also in poorer developing countries – including, for example, parts of Africa in recent years – the value of such a framework for ambitious future managers becomes apparent.
Our focus will be on the non-market factors that influence private sector behavior in the developing world. Non-market factors are relevant for the behavior of firms anywhere but particularly important in poor countries. To succeed in developing countries – whether seeking new markets for its own products, new suppliers in its production process or high-yield local investment opportunities – a firm must be able to assess factors such as the risks posed by weak legal systems that limit the enforceability of contracts, corruption and political instability.
Our goal in this course is not to become experts on particular countries or regions but rather to train ourselves in the use of a framework and principles that can be applied across many countries, markets and sectors. The framework derives primarily from the field of economics, and we will not completely jettison its traditional assumption of efficient markets. But developing countries’ economies are characterized in part by significant market- and contracting failures, the analysis of which will play a large role in our analysis. In doing so we will integrate specific examples with the latest research in economics and other relevant fields.
Professor Hjort joined Columbia Business School in 2012. Before coming to Columbia, Professor Hjort received a BSc Economics from the London School of Economics, an MA International & Development Economics from Yale and a Ph.D. Economics from UC Berkeley. His research spans issues in development, labor and behavioral economics, with a particular focus on topics in their intersection. In recent work Professor Hjort has...