This picture is of a woman who just voted in Africa, especially in rural areas without voting machines and without good record-keeping. A common practices for voters to dip a finger into a pot of indelible link to demonstrate they voted. Those countries where voting has not had a long history, an inked finger as a sign of democratic pride and responsibility. Let's begin by defining in categorizing the various political systems found in the world. Our first topic are the various foundational political system is found among countries. Political system is a collection of public and private institutions, political organizations and various interest groups that collectively provide the framework for running a country. Relationships between these entities to find norms, rules, and conventions that limit and prescribe a business operate within that country or region. One way to think about the success of a political system is whether a society can hang together and operate in constructive ways. Currently seems to political systems of several countries are failing to keep their societies together, including Venezuela, Somalia, Syria, Afghanistan, and certainly some others. When comparing political systems to principal scales are useful. Individualism versus collectivism and authority versus liberty. The diagram here uses these two scales to define four broad types of political systems. Collective authority, individual authority, collective liberty, individual liberty. These quadrants are democratic, aristocratic, oligarchic, and tribal systems. These differentiations are crude because most systems are much more complex than a two-by-two diagram. But nonetheless, they're helpful for providing a framework to better understand and compare international political systems. Let's take a closer look at the individualist versus collectivist perspective. In individualist perspective has the individual as it's primary focus while individual rights generally trumped the prerogatives of the state. Values from this perspective include primacy of the individual in political, economic, and cultural ways and freedoms and minimize government intervention. A collectivist perspective in contrast, has the state it's primary focus for the prerogatives of the state trump individual rights. Values from this perspective include the needs of society take precedence over individual needs, and government defines the needs and priorities of the country. This map shows where various countries fall on a scale of individualism to collectivism. North American countries, Australia and England, shown here in red. Historically, if taken individually visual right is paramount. In contrast, those countries shown in green taking more collectivist perspective. Yellow and orange countries fall somewhere between the two. From a business perspective, understanding the individualist versus collectivist perspective on countries government and its citizens can have important implications for constructively working within a country. The second spectrum we use to define political systems is that from authority to liberty, at one extreme or a dictatorships in autocracies, where government and powerful individuals make the rules. In the middle are democracies were individuals make the rules either directly or through elected representatives. At the far extreme of liberty is anarchy, or individuals make individual rules overarching any authority at all. Most of us would not choose to live in an hierarchy. Every year, The Economist Intelligence Unit of the Economist magazine publishes a democracy index that ranks a 165 independent states and territories on a scale from fully democratic, to authoritarian. This map shows how countries here on this index. Western Europe, the Americas, India, Japan, and Australia are calculated to be democratic. Most of Asia and most of Africa are measured as authoritarian, other countries fall between. Putting our two political system spectra together, we come up with the following chart. The spectrum of collectivism to individualism is on the horizontal axis and the authority to liberty spectrum is on the vertical. These two scales again divide political systems into four quadrants. In the upper left quadrant, collective authority are democratic systems. People collectively make the rules which everyone is expected to obey. In the upper-right, individual authority are aristocratic in autocratic systems, or nobility and dictators make the rules. In the lower right, individual liberty is oligarchy, where a powerful in-group makes the rules. The in-group could be economic barons, religious authorities, political elites, or some other small group that somehow has ascended to power. In the lower left quadrant, collective liberty, are tribal systems where tribal customs in groups of elders make the rules based on custom and tradition. Finally in the middle is anocracy and a credit political systems combined democratic and oligarchic systems. Elections are held among a selected set of candidates, but authority ultimately resides with a political party or among powerful oligarchs. The rise of anocracy systems has increased significantly with the dissolution of the Soviet Union and the opening of China in the later decades of the 20th century. This final map shows the global dispersion of political systems among nations of the world. Democratic systems are shaded in blue and green. Most of the Americas, Western Europe, South Asia, and Southeast Asia, have democratic systems of one favor and other. Autocratic systems are shaded in red. Countries in the Middle East and Central Asia are largely autocratic. Country shaded in yellow and orange are anocratic with political systems that combine democracy, autocracy, oligarchy in some combination. Many countries in Africa, Eastern Europe, and Northern Asia have anocratic political systems. In summary, there's a wide variety of global political systems in the world. To better understand this variety, we can evaluate political systems along two dimensions. Individualism versus collectivism and democracy versus autocracy. Using these two dimensions, we can then divide political systems into four categories. Democracies, autocracies, oligarchies, tribes, and anocracies, actually that's five categories. When doing business abroad, it is critically important to know these distinctions. Doing business in a democracy will be very different than doing business in an autocracy, which in turn will be different than doing business in anocracy. Now, knowing the political rules of the game and in countries where you do business can be catastrophic. Be aware.
