Anita began by asking Jay about the connections between the major themes in his work.  She said that some backbone themes are the resource-based view, risk-taking, luck, entrepreneurship and sustained competitive advantage.  Recently, you have been interacting with philosopher more intensively.  How do these themes and interactions relate to each other? 

Jay became interested in poverty alleviation when he was a child visiting Tijuana MX from his home in California.  Since then, he has felt that something is wrong.   In their conversation, Jay describes how this led him to work in Bolivia and then in Ghana mainly with students, and mainly over the past 15 years or so.   His motivation was that this was the right thing to do – rather than to write more papers.  

Anita then pitched a paper idea along the following lines:  You and I were up in the Wasatch mountains at one point just after you had written your SMJ on how the RBV requires a stakeholder perspective.  The core idea here is that, if the investors get all the upside benefit of my effort as a stakeholder, then Ive got no incentive to contribute.   So how does that play out around poverty alleviation? You’ve done incredible work on poverty alleviation and entrepreneurship in Peru, Bolivia and Ghana.  In these settings, small-scale retail and trading may be the one and only option for alleviation through entrepreneurship.   Im thinking of the Peruvian craftspeople that I know you studied.   Can stakeholders such as these entrepreneurs turn down contracts even if they don’t make much from them?

Jay described how this idea about limits on outside opportunity may have some purchase.   He talked about a woman in Bolivia who was willing to walk 20 miles with a 2-year-old on her back to sell a $25 scarf.    And about the challenges of getting the craftspeople making these scarves to hit the specs that the client needed.    He talked about the similarity and contrasts theoretically with an oil & gas company that lost a customer because the company was a tough negotiator.   This relates directly to the idea that there has to be upside for a stakeholder to participate in a contractual arrangement.

Is it OK to think of the process that you describe in your early papers of resource acquisition by the entrepreneurs under uncertainty as dynamic?   That seems to me to raise fundamental theoretical issues relating to the amount of uncertainty and risk that different stakeholders can take on.  For example, if these impoverished entrepreneurs don’t have many alternatives, then maybe they say yes and generate a lot of returns to investors.  But large customers might push back and demand lower prices, for example.  Should we be thinking about how to expand and adapt our understanding of the resource-based view on firm behavior to account for differences in stakeholder risk capacity?   

Jay saw this as another interesting set of questions.  He described how traditional resource-based theory sees resources as given, but of course, in many developing economies, they are not given.  

Jay feels that our theories are not always helpful directly in these settings, even though they may be descriptively relevant.  He talked about the importance of getting deeply into the field and the phenomena.   Sometimes institutional innovations occur, such as when an NGO in Peru called 10,000 Villages emerged to provide work to mothers who needed to take care of their children concurrently with performing their jobs.   Sometimes a silver bullet like this arises.  But often not.  Jay gave another example of a Ghanian bead craftsperson who sold his products to Parisian models, but not for prices that reflected their full value in use.

We need to go deep phenomenologically to find the theory opportunities.

Where do you see the greatest opportunities for theoretical development on the RBV and new stakeholder theory?

Jay reflected on the Pi2 conversation with Arielle Newman.  He talked about her courage and her humility.  She got buried in the phenomenon, and that’s where the theoretical breakthrough will originate.   You can’t understand poverty alleviation from afar.   Institutions such as we have designed internationally are not going to be able to intervene in the way that they do in other places.   The challenge – and here Jay cited the documentary called Poverty Incorporated – is that there’s a large apparatus that prevents their effectiveness.   What will it take for local villagers to benefit from tourism in Cusco Peru?   It will require more insights about what tourists need than are currently being conveyed by the industry there.

Anita asked Jay about his current work in philosophy.

He described this as heady theoretical stuff that needs to be tied to field experience.  What’s morally right?  What’s practical?  How do you create just relationships between stakeholders?   This is a difficult thing to accomplish.

What makes you optimistic?

Jay had to dig deep to answer this question.    The truth is that, over the past hundred years, there has been a lot of progress.   Jays view is that relatively little has to do with foreign aid and philanthropy as compared to entrepreneurship.   Much of the success originated in China and India, which greatly benefitted from open trade and international agreements.  Jay is worried about that over the next 20 years.   He’s concerned that reaching across country boundaries may be limited and that entrepreneurial opportunities may be blunted as a result.  

What makes Jay optimistic?   When he began this journey, he wanted to be on the right side of history morally.    What is the equivalent today?   Abject poverty is today’s moral equivalent of the slave trade historically.    We have many tools, but there is a great deal of work to do to apply them toward that end.   Jay is optimistic that businesspeople will want to do the work.