Improving The Environmental And Economic Performance Of Players In Markets- An Egyptian Fable

Abstract

Evidence from research across a number of developing countries suggests that where small firms exist in clusters, positive interaction does emerge over time. As part of this co-existence many of these firms grow at a higher rate than those working in isolation do. The theory is that by working together, firms benefit from the joint learning experience, which leads many of them to successfully access national and international markets. It is apparent that many of the examples cited have emerged largely by chance (Schmitz, 1997). However recent research suggests that governments can intervene to the benefit of small firms. Success, in such circumstances, is based on a collectivist approach to problem solution and a concerted effort (on behalf of the interventionist) to direct assistance into the supply chain, as opposed to the more widely accepted package of measures available to individual firms. This is important as traditional economic solutions are not concerned with the fact that small firms have neither the means nor experience (or sometimes the will) to recognise the problems that their activities may and do have on the environment.It would appear that whilst many developing nations governments introduced direct and indirect assistance policies targeted at the small firm, most did not recognise that small firms do not simply start, expand, consolidate and then expand again. Small firms start up (some die and are resurrected) they expand, contract, consolidate, expand, consolidate are taken over or take over other firms. Their owners compete and co-operate with other small firms (Best, 1990; Bennett and Robson, 1998). One possible answer is that governments failed to understand that open and dynamic systems include groups of interrelated elements and relationships (Emery and Trist, 1965). Elements are the components of the system, and relationships are those things that tie the elements of the system. The behaviour of the system is affected by the condition of its components, and the system components are affected by environmental conditions.In this paper, the author reflects on his experiences (1999) within the Governate of Damietta, the historical home of the furniture industry in Egypt. He then goes on to demonstrate the mechanism for ensuring that the growing concerns associated with the dual pursuit of economic and ecological efficiencies are brought sensitively to bear in this market.