Antoine van Agtmael coined the term emerging markets" and built a career and a multibillion-dollar investing firm centered on these surging economies that would, over time, supplant the West as engines of wealth and prosperity. The trend held for decades, but a few years ago van Agtmael and Alfred Bakker, a renowned European journalist, began seeing signs that the tide might be turning. For example, during a visit to an enormously successful chip company in Taiwan, the company's leaders told them that their American competitors were now eating their lunch. And Taiwan was not the only place giving them this message.
Thus began a remarkable two-year journey to reassess the conventional wisdom that the US and Europe are yesterday's story and to determine whether there is something profound that is happening that points the way to the creation of the next economy.
In The Smartest Places on Earth, van Agtmael and Bakker present a truly hopeful and inspiring investigation into the emerging sources of a new era of competitiveness for America and Europe that are coming from unlikely placesthose cities and areas once known as "rustbelts" that have, from an economic perspective, been written off. Take, Akron, Ohio, whose economy for decades was dependent on industries such as tire manufacturing, a product now made cheaply elsewhere. In Akron and other such communities, a combination of forcesincluding visionary thinkers, government initiatives, start-ups making real products, and even big corporationshave succeeded in creating what van Agtmael and Bakker call a "brainbelt." These "brainbelts" depend on a collaborative style of working that is unique to the societies and culture of America and Europe, since they involve levels of trust and freedom of thinking that can't be replicated elsewhere. They are producing products and technologies transforming industries such as vehicles and transportation, farming and food production, medical devices and health-care.
For several decades American and European industry focused on cost by outsourcing production to those emerging markets that can make things cheaper. The tide has now turned, as van Agtmael and Bakker report, to being smart, and the next emerging market, may, in fact, be the West.
About the Authors
Antoine van Agtmael is senior adviser at Garten Rothkopf, a public policy advisory firm in Washington, DC. He was a founder, CEO, and CIO of Emerging Markets Management LLC; previously he was deputy director of the capital markets department of the International Finance Corporation ("IFC"), the private sector oriented affiliate of the World Bank, and a division chief in the World Bank's borrowing operations. He was an adjunct professor at Georgetown Law Center and taught at the Harvard Institute of Politics. Mr. van Agtmael is chairman of the NPR Foundation, a member of the board of NPR, and chairman of its Investment Committee. He is also a trustee of The Brookings Institution and cochairman of its International Advisory Council. He is on the President's Council on International Activities at Yale University, the Advisory Council of Johns Hopkins University's Paul H. Nitze School of Advanced International Studies (SAIS), and a member of the Council on Foreign Relations.
Alfred Bakker, until his recent retirement, was a journalist specializing in monetary and financial affairs with Het Financieele Dagblad, the "Financial Times of Holland," serving as deputy editor, editor-in-chief and CEO. In addition to his writing and editing duties he helped develop the company from a newspaper publisher to a multimedia company, developing several websites, a business news radio channel, and a quarterly business magazine, FD Outlook, and, responsible for the establishment of FD Intelligence
"Energetic... Offers a hopeful perspective on how imaginative economies can become pacesetters in the fast-forward Knowledge Economy... Longlisted for the Financial Times/McKinsey Business Book of the Year Award, SMARTEST PLACES is receiving well-deserved attention among corporate leaders and financial strategists -- and it ought to be required reading for every would-be policymaker." --WorldBank.org "The book contains an abundance of insightful information... A strong selection for those interested in high-tech industries or community economic revival." --Library Journal "The perspective here on the transformation of 'rustbelts' into 'brainbelts' has an outsider's freshness toward America and an international expansiveness...Akron glitters like never before in these illuminating pages." --Kirkus Reviews "The authors make a strong case that a renaissance in the development and manufacturing of 'chips, new materials, and biosciences' is happening not in tech or major urban centers, but in reclaimed factories and settings like the revitalized American Tobacco Campus in the North Carolina Research Triangle. For anyone looking at trends in technology or manufacturing, or at the future of global business, this insightful work will provide food for thought." --Publishers Weekly "This book upends conventional wisdom about how the global economy works and which places are primed to thrive and prosper. Van Agtmael and Bakker capture the complex market dynamics that are revaluing the formidable assets of U.S. and European older industrial cities: advanced industries and networks of universities, companies and governments that collaborate to compete. These are refreshing insights that build on real world experience and evidence rather than antiquated group think." --Bruce Katz, Brookings Institution Centennial Scholar and co-author of The Metropolitan Revolution "The authors offer a compelling and insightful look at how companies and communities are turning ashes into silicon valleys." --Harold L. Sirkin, Senior Partner, The Boston Consulting Group (BCG) "The riveting story of how failing rustbelts in the Unites States and Northern Europe have transformed themselves into emerging brainbelts through the triumph of collaboration and ingenuity to become promising models of bottom-up innovation." --Hilda Ochoa-Brillembourg, Founder and Chairman, Strategic Investment Group "An absolutely fascinating tour of cities in the United States and Europe that were once traditional centers of manufacturing which are now reinventing themselves as hubs of innovation. If you want to understand how economies at the local level can transform themselves, this is the book to read." --Liaquat Ahamed, author of Lords of Finance "van Agtmael and Bakker paint an exciting picture of the future based on progress made possible by cooperative processes they call 'brainsharing.' Citing unheralded developments in specific places and specific industries, this extraordinarily well researched book challenges the conventional view of a developed world in relative decline. The authors make a compelling case for the role of connectors, who bring together a diverse collection of players required for collaborative success. This compellingly argued and lucidly written book is a must read for anyone who cares about the future of the planet." --David F. Swensen, Chief Investment Officer at Yale University "A lively, lucid story of innovation and transformation powered by brainpower and business, academe, and regional governments working together... The smartest book on one of the most important and promising trends in the American and global economy." --Strobe Talbott, President of The Brookings Institution "In every chapter of economic history, unexpected places have cultivated the dynamism that transforms society at large. Antoine van Agtmael and Fred Bakker describe how the next generation of emerging hotspots are located in unlikely places, as industry connects with the energy of universities and academic medical centers to transform rustbelts into 'brainbelts.' This scouting report will interest students of the future taking shape today." --Dick Brodhead, President of Duke University "This eye-opening account of innovation in unlikely places will raise the spirits of anyone discouraged by the gurus who keep telling us the future belongs not to the established democracies of the capitalist world, but to emerging powers mostly in Asia. No, Van Agtmael and Bakker tell us, the 'smartest places on earth' may be in little-heralded cities in the United States and northern Europe, where business people, scientists and creative managers are inventing smart new products and ingenious new ways to manufacture them. They tell us that many of the old economies of the developed world 'are entering a revolutionary new phase' because 'the global competitive advantage is shifting from cheap to smart.' I found their arguments, and the facts they have gathered to support them, both intriguing and convincing. And their book is fun to read." --Robert G. Kaiser, former Managing Editor of the Washington Post