February 2016

Imagine a closing door that people continuously walk through, located on a busy plaza.

An average person with no thoughts of altruism will open the door just enough to fit him and then proceed to walk through. No value created for others. This is a consumer in an economy—the focus is in fulfilling needs for self.

Another person inclined to altruism will open the door and hold it open to the next person after them. Small, although unscalable value created for one other person. This is an artisan or a service person. Value for others is a concern, but the means are limited. One barber can only focus on one client at a time.

Then there’s a person who sees the waste of opening the door each time a someone wants to go through. He devises a doorstop to keep the door open for anyone who walks by. This is an entrepreneur. He crafts a product which creates value in a scalable way and to the masses.

Finally, there’s another smart person who notices that the hallway is really windy and cold when the door is continuously kept open. He creates a door that will automatically open when someone is walking towards it, and keeping it shut when there’s no passersby. This is an entrepreneur who creates a better product with the help of technological progress. The problem solved is still the same, but the means of solving it are more sophisticated.

In each scenario, the financial compensation enjoyed by each person seems to be directly correlated to the value they end up creating for others.