V. Kasturi Rangan of Harvard Business School and Djordjija Petkoski of the World Bank Institute argue long-term global prosperity and stability need to be supported by expanding growth, especially among the low-income segments. In their view, the financial crisis creates unique opportunities for companies to reassess their strategies and identify innovative and inclusive business solutions.
According to their article published in “Development Outreach”, “hyper competition will speed the declining growth and fast commoditization of high-income market segments, thus putting an additional pressure on companies to expand their markets in developing countries. Furthermore, pressure on companies to create jobs and do business with low-income groups will increase.”
Furthermore, Rangan and Petkoski argue that “growth based on tapping into low-income markets should aim primarily at wealth creation, including providing access to jobs, healthcare, education, and vocational training. This objective should even precede the marketing of consumable goods and services that help improve the quality of life of the poor.”
The piece is part of a wider series of articles in the December 2009 issue of the World Bank’s Development Outreach magazine, focused on the impact of the financial and economic crisis.
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