Response to Erica's post 11/11/09

Your post reminded me a lot of some consumer goods they created in Kyrgyzstan. I spent two years there (July 2006-July 2008) living with a Kyrgyz family in a small village. The car for $2,200 and the cell phone for $20 with $.02 per minute are very similar to items they have in Kyrgyzstan.

The car in Kyrgyzstan is called the Tico. It is $2000 and very small, similar to the Smartcar, only with a tiny backseat and four doors. They are affordable to the villagers and everyone wants one. It is a sign of pride and modernization to drive a Tico.

Cell phones are inexpensive with inexpensive plans. Usually people buy pre-paid phone cards with a set amount of units. They use the phone until they run out of units and can afford to buy more. Similar to the Tico, it is a mark of pride and modernization to own a cell phone.

The villages have very little heat, very little food variety, and very few possessions. But they are anxious to join the "modern" and more specifically, "western" world. The money they have, they are willing to spend on these inventions and this type of commerce.

You posed some interesting questions..."How will India’s success in leveraging the untapped growth potential of its’ poor constituents influence the direction of innovation and marketing for other countries?" I don't know if Krygyzstan is being influenced by India directly, but it seems that there is an emerging market and growth potential of commerce for the poor constituents. As you mentioned, these are not poorly made items either. They are made to be less expensive, but also made to last.

"What do you think this will do for the standard of living in India and abroad?" As far as standard of living, it increases in someways and it stays the same in others. A Kyrgyz family may own a car and phone, but still not be able to afford proper winter clothes or proper heating. As far as basic standard of living, they made a life choice to own a car, instead of heat their house for the winter. One would think that heat and warm clothes would increase their actual standard of living, but the Kyrgyz family seems to think that owning a Tico and a cell phone does. I guess this brings up another issue... What increases the standard of living? What factors do we include when measuring?