Small is beautiful proclaimed Dr E F Schumacher in his early-70s polemic on modern economic structures. A simplistic rendering of his main point is this – the modern economic landscape dominated by large organisations (big business & big government) is far less efficient than would be an economic structure in which a large number of small organisations work together in regional marketplaces.
As a financial consultant working on large infrastructure projects, I have seen the first model closely. Over the last 3 years or so, as a participant in the world of tourism, I can see the potential of the second model. In balance, I feel we in India have completely neglected the second model, which is why we are in the throes of a constant discussion on “inclusive growth”.
Tourism is the classic ‘small is beautiful’ industry. It is an industry in which very large, transnational or even pan-national entities are the exception. (As a simple mind game, try to think of large tourism businesses listed on any major stock exchange – other than a small number of tour operators, there are no large, pure-tourism businesses. The rest are hotel chains and airlines who are really in other businesses). The primary economic actors in tourism are the large number of small, independent hotels, little restaurants and street-food vendors, tour guides, local taxis and so on. Given the large number of individuals that this business touches, the direct impact of a booming local tourism economy is massive.
So if you want get the “inclusive growth” that our worthies have been repeating ad-nauseum about (and getting us into massive government pork-barrel projects in that name, which is exactly the kind of thing that Schumacher warned against), tourism, my friend, is the way to go.