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Epic Country-Level A/B Test Proves Open Is Better Than Closed: Estonia vs Belarus, by Alec Ross, Medium


Stashed in: Russia and Friends, A/B Testing!, Medium

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Fascinating book excerpt about a historical change that most Americans know little about: the different paths taken by former Soviet republics Estonia and Belarus. One is now a thriving innovation center and the other is an authoritarian hellhole... for reasons having fundamentally very little to do with differential immigration, education, racial divisions, social class, or all the other excuses you hear about why change can't happen. People who believe the political leadership of a country doesn't matter because technological change will always triumph -- you need to read this right now!

The things that struck me in this article were Estonia pushing reforms to make Internet a basic human right and giving anyone in the world ability to be an "e-resident" of Estonia. Wow!

In December 2014, Estonia made yet another bold move, offering what it calls “e-residency” to any person in the world. As the country put more of its government services online, from incorporating a company (which happens at a world-leading speed, estimated at five minutes) to authenticating electronic signatures, it has seized the opportunity to position itself as a hub for digital government services. To become an e-resident of Estonia, you make one trip to the country (though it hopes to be able to operate out of its embassies in the future) to submit your biometrics and other personal data for verification. You pay the registration fee and receive a secure chip-enabled identity card. You can now use your Estonian e-residency for a variety of things, such as doing business throughout the EU and leveraging its online-only programs for contracting and tax filing. It’s a way to bypass other countries’ more expensive and less efficient systems. No more paperwork, lower taxes, and, if you own a business, all the freedom that comes with being an incorporated business in the EU. In a similar way to how other countries have created tax havens to benefit from large deposits in their banks, Estonia has established itself as an efficiency haven. Instead of facilitating criminal behavior as tax havens do, Estonia’s system is trying to make business more secure. The ideology behind it is rooted in good government. Among the benefits to Estonia is the additional tax revenue and more than $500 million in fees alone that it expects from 10 million e-residents over the next several years. Every leader I’ve spoken to about Estonia’s e-residency has the same one-word, three-letter response: wow.