Korea: Economics of failure

[unhappycamper]

http://koreajoongangdaily.joins.com/news/article/article.aspx?aid=2980345

Failure in Korea is stigmatized for life. It is why we find few risk-takers and too many followers.

Economics of failure

In the city of Ann Arbor, Michigan, there is a unique place run by the German market research institute GfK Custom Research North America colloquially referred to as the Museum of Failed Products. It exhibits more than 70,000 food and household brands and consumer items shunned by consumers that are now extinct. Among the top picks of America’s biggest failures are smokeless cigarettes, colorless cola and spray toothpaste.

They were born through inventive ideas and insight, but went straight to the graveyard because they simply did not meet the public’s appetite. The museum shows that the world’s leading capitalist country, the United States, celebrates even the dark side of the harsh commercial world to offer lessons on how innovation and technology, regardless of creativity and sensationalism, can end in failure.

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In Japan and the United States, there are even scholars who study failures. Yotara Hatamura, a professor at the University of Tokyo, differentiates between good and bad failures. Necessary failures are inevitable growth pains and stepping stones for new development and improvement. But in bad cases, neither experience nor lessons can be obtained as they are simple repetitions of failures through negligence and misjudgment. Failures - when attempted with sincere efforts - should be tolerated. Bad and fatal mistakes and failures, however, should not be tolerated.

Greedy companies and lazy entrepreneurs who merely depend on government support and bailouts must pay the price. We must increase the odds of success by encouraging entrepreneurs to make attempts at new ventures and ideas without blindly removing the punishments for failure.