The Duke CCMBA has a novel structure that includes two courses that spread out across five of the six terms. One of these, "Cultures, Civilization, and Leadership," aims to give us the context and a set of tools to deal with the myriad cultures we encounter during the program and after. The class requires us to compose a "cultural disconnect" essay each term, which the rest of the class, rather than the professors, evaluates.
Here's mine for Dubai. (The essay refers to some diagnostic and cultural tools we've used in the course, including Cornelius Grove's cultural dimensions and the Duke Inter-Cultural Expressions (ICE) profile.)
Trading commodities underpins the financial industry in my home city, Chicago. Contracts worth billions of dollars for corn, soybeans, and hog bellies (sometimes with the hogs still attached) pass through the Chicago Mercantile Exchange every day. The CME will soon phase out its open-outcry pits, but they still exist, and traders still yell and scream to keep the buy-sell spreads as small and as reflective of market conditions as possible.
The Dubai spice souk does very much the same thing in the same way: in it, people trade commodities and fix the prices based on yelling at each other.
I should mention right now, I’m not a trader. I write software for traders, and I think they’re great people, mostly. But people become traders because they feel a rush over getting one more sixteenth of a dollar on a put option. I’m happy to help, but I’m the last person anyone would want in a trading pit. Here’s why.
The day before our culture dash, I took the Dubai Metro across the Creek and walked through Deira to explore. My Lonely Planet guide not only told me where to find the spice and gold souks, but also gave me some information on something called “bargaining.” Because I’ve seen the CME I could understand the theory behind this phenomenon. Apparently, like at CME, people exchange things of value for money after yelling at each other. The scale is smaller and slower (grams instead of tonnes, dirhams instead of millions of dollars, hours instead of milliseconds), but the idea, I had read, was the same.
I poked around the spice souk for a few minutes, dodging the fake Rolex hawkers, and found a shop run by Ali and Malik. They both welcomed me in and immediately started pointing out the spices for sale: curry powder, rose petals, cardamom pods, cinnamon sticks, all right there in small bins. To emphasize the quality of the merchandise Ali physically maneuvered me from one bin to another and merrily explained what each spice was and what it was for. I nodded a lot and demonstrated my deep spice knowledge by saying things like “saffron” when he pointed at the cloves, for example. Malik, meanwhile, wandered in an out of the store, chuckling to himself.
I asked for about 50g each of four spices. Ali scooped them into bags and weighed them, informing me eventually that each bag had somehow become 60g (no cultural disconnect there—they “accidentally” add about 10% to every weighed item at the local Whole Foods, too). Then we stared at each other.
Ali, no dummy, realized that I completely missed the point about bargaining: the parties actually have to come up with a price before they can consummate the sale, which requires that someone make an offer. Ali also understood that “strategic silence” (something else I’ve read about in books on negotiating) might result in me blurting out a number so high that he would feel bad (but not that bad) taking it from me.
Finally he gave up and blurted out, “OK.” Then he consulted a dog-eared booklet, typed in some numbers, got out a calculator, and showed me what it said. After a little mental arithmetic I realized two things: (a) the price quoted for the spices in the bag were easily one-half what they would cost in Chicago; and (b) Ali would never sell these spices at that price to anyone who knew the first thing about bargaining.
This year’s Lonely Planet: Dubai promised that the real price for something will be 20% to 50% less than the opening offer. It also said that some people hate bargaining. Somewhere between these two facts, I offered 20% below the quoted price, and after several minutes managed to get a 10% discount on Ali’s opener. (In my defense this represented both producer surplus and consumer surplus, which means everyone got something he wanted out of the transaction.)
So what happened? My ICE profile shows I’m a typical Midwest-raised American. I have a Direct communication style in Ambiguity in Communication, and I’m Reserved in almost every indicator of space context. In other words, I prefer quiet, to-the-point discussions (not that I haven’t had less-than-quiet arguments every now and again), with less touching and more physical distance than even many other Americans. In the souk I faced an experienced bargainer with considerably more information about the transaction than I had, moving closer, and raising his voice.
Another factor: when viewed through Grove’s Cultural Dimensions, in this transaction Ali and I came from opposite ends of the Uncertainty Avoidance continuum. To Ali, not knowing the final price was expected; to me, it was disconcerting. Grove maps low Uncertainty Avoidance to informal interactions, lackadaisical recordkeeping, and informal norms; higher Uncertainty Avoidance shows formality in interactions, a desire for ordered data, formal procedures, and calculated risks.
As a reserved Midwesterner, I don’t usually interact with anyone while shopping until I’m ready to buy something. Then, I expect to pay the offered price (except for cars and real property, two important exceptions). If a merchant offers an item for sale at a price I think too high, I simply don’t buy it from her, without comment. A shop that offered items at 20% to 50% over the market-clearing price would soon go out of business in Chicago, as locals would think the place was a rip-off.
In Ali’s world, who can say what the price will be? He does know, to some extent, what his boss paid for the spices, and he knows he should sell them for more than that, but so what? A tourist might walk in any time and pay 50% over cost for a tiny bag of curry powder.
This style of trading is a vestige of the region’s long history of nomadic, barter-based society. In the desert, traders...well, traded, not for abstractions like money but for real things that they needed. They lived in an uncertain, hostile environment. A thing’s value could change from day to day, as conditions shifted or as they acquired other items through trade. Spices, in particular, had huge gyrations in value as they came through the region in large quantities but at irregular intervals. To imagine that you could trade a measure of cloves for an unvarying, arbitrary amount of bronze from one day to the next would be considered foolish; to imagine you could exchange it for paper would be considered insane.
In the end, I came to a rapprochement with Ali, when my entire team invaded his store the next day on the Culture Dash. I may have paid too much the day before, but for the extra business I brought him, and for taking a bag of pistachios for 80% of his first offered price (“for you, 20% off!” How could I refuse?), he gave us some cinnamon at the best price he could offer: free.