Category: Economics 2707

Introduction

Household production is the making of services and goods by the members of a household, for their own consumption, using their own capital and their own unpaid labor. The household production goods include food, clothes, beddings, dishes etc.

Despite the fact, on average more than eighty percent of womens time is devoted to non-market activities, little is known about how women allocate time not devoted to paid labor. A cross-country comparison of time allocation in Juster and Stafford in 1991 shows that on average women spend between 24 and 35 hours per week on market work, between 27 and 34 hours on housework, about 70 hours on personal care including sleeping, and between 25 and 42 hours on leisure.

Females in paid working places spend less time on housework and child care than women who are not employed. Juster and Stafford 1991 and SCP 1992 found out that the time men spend on housework is roughly the same in all areas and walks of life, the only exceptions being Sweden, and Japan. Swedish men spend relatively more time on housework, whereas Japanese males do not use a lot of time on the caring for their children or doing housework. The global differences in housework time for females are much smaller than those for men.

A study by the Germany Central Bureau of Statistics on time use shows that men and women devote a similar amount of time to their personal care, eating, and sleeping CBS, 1994. Men and women have about an equal total amount of leisure time at their disposal. Women, however, devote more of their time to household work and looking after the children while men spend more time on the labor market. Household production differ from house to house depending on the size of the family. For example, married people consisting of partners who are both in the labor market, have less leisure time than couples in which only one of the partners, or neither partner, is employed.

On the issue of allocation of time within a household production framework, there are two main approaches according to the household model that can be distinguished. The first intervention involves a specific functional type for the preference structure and household production to derive the time allocation equations. Examples of this approach were formulated by Graham and Green in 1984. In 1987 Kooreman and Kapteyn talked about the different times that different individuals especially a man and a woman spend in both market labor and household production. While Graham and Green in 1984 used a Cobb-Douglas specification for the household production function, while Kerkhofs in 1994 used a more flexible specification in which household production is a linear function of time spent on household activities by husband and wife, the square of these time inputs and the interaction between male and female time inputs in household production. Kooreman and Kapteyn in 1987 used the indirect translog utility function as a specification for their model.

The second concept is used to given functional forms for the equilibrium conditions of the household production model. This approach is taken in Gronau in 1980 and in Kiker and Mendes de Oliveira in 1992. In equilibrium, there is equality for persons who spend time on each activity and do not spend all of their time on one activity between the productivity of work at home, the marginal rate of substitution between leisure and income, and the market wage rate. Gronau in 1980 specifies a functional form for the home production function, from which the equation for work at home is, derived (Gronau, 1986).

Research suggest that in most countries, the value of household production is approximately seventy percent of household income after taxation in their respective countries (this means that, household production is about three-quarters of the income earned by employed women). In houses where there are still young children, the value of household production is about equal to family income after taxation implying that such families work mostly on household production to satisfy their family. For example, it is found that most females with little children, the loss of household production when the woman enters the labor market almost equal the net earnings from paid work, this means that most women will have to spend much of their time and energy at home working on household production than they could spend on the labour market to be paid for their services.

Gronau in 1980 also finds that the value of household production increases with education, therefore the more educated woman become around the world the more they appreciate the value of their families and household production at large but this increase in the value of household production with education is much less than the increase in the market wage with education. Kiker and Mendes de Oliveira in 1992 also find that the returns to formal education in the non-market sector are lower than in the marketplace; however in 1988, Mr. Homan did a research and found that higher educated women spend less time on household production than lower educated women this can be stressed to the point that lower educated woman have no extra thing to do apart from the house chores that awaits them in their homes and residing places. Kiker and Mendes de Oliveira in 1992 further find that there are diminishing returns to non-market production this is mainly because more and more women get education and they place most of their time and energy at their workplace.

The marginal value of the one-thousandth hours of non-market job for women is about sixty five percent of the value of the first hour. Graham and Green in 1984 Conclude from their findings that the elasticity of household production with respect to market goods is higher than the elasticity with respect to the time spent on household production. They also conclude that there are no economies of scale in household production, and that both men and women human capital is more productive in market work than in housework.

In 1987, Kooreman and Kapteyn, find that the presence and age of children have a large effect on the time women spend on the care of children. The availability of children lowers the time used on entertainment and social activities. However, the allocation of time by the husband is hardly affected by the presence of children. In Homan in 1988 and Kerkhofs in 1994, it is also found that the presence of young children has a strong positive effect on home productivity of men and women. In Kerkhofs in 1994, it is further found that for both men and women home productivity increases with age. For females home productivity reduces with education levels attained: highly educated females spend less time on housework and more time on paid work. Homan in 1988 concludes that two of the most important determinants of the allocation of time are the size and life stage of the household. Especially little children increase the amount of time used by men and women on household production (Wicks, 1990).

Substitutional effect in household production: Some activities in the house are more and more intense than others, this will implies that when the wage rate increases the price of those activities that are intense increases also.this will make the activities that are work-intensive to be replaced by the activities that are time-intensive within the household.

An illustration in Graph 1:

• The variant B represents a woman who is in labour Market (that is, a woman who is employed and she is working).
• While variant A represent a woman who is not in the labour market (a woman who is not employed at any given point) the y-axis presents wage income received.
• While the x-axis presents the time applied by different women at their leisure activity time at any a given period that they have.

The graph interpretation is that, since woman A is not employed the she takes is longer than woman B who is employed and earns more according to the graph than A(the distance at the x-axis between the point of origin and where A is situated is longer than the distance between the point of origin and B).

In 1992, a researcher by the name Van der Lippe found out that household work is most evenly distributed between husband and wife when there are no children. The arrival of children generally gives rise to a specialization. Women are therefore forced to apply themselves to housework and care for the children and men run to paid employment outside the house. The presence of children increases household work and child care by women by about 17 hours, while the share of men in these tasks remains about the same since almost all men take the role of breadwinner in the house and therefore they look for paid jobs outside their living areas.

During the past twenty years the amounts of time women spend on housework and child care has decreased, while the amount of time women spend on market work has increased, this has been brought about by the changing technology, globalization and increase in education for women.

Despite this increase, surveys of female labor supply studies show that the number of in the labour market is still very low compared to their male counterparts. Wage elasticity of female labor supply is fairly high, and certainly higher than that of male labor supply for example Theeuwes and Woittiez in 1992 did a survey of wage elasticity of labor supply in The Netherlands. An explanation has been put forward to explain this high wage elasticity is that women have more alternative uses for their time than men; this has been explained and elaborated by Mincer in 1962, 1963. An increase in market remuneration makes men to prefer doing market work, whereas a wage increase leads women to substitute not only leisure but also housework and child care for market work (Killingworth and Heckman 1986).

With regards to the theory of household production, women are more productive at home, relative to their productivity on the labor market, than men. Therefore we connect the individual labour supply to that of the model of time taken by an individual. This implies that we no longer assume that time can be divided simply into two categories, market time and leisure time, but that it can be allocated to more than these two activities. We formulate a household production model including four activities: market work, housework, child care and leisure.

With regards to the theory of household production, in equilibrium there will be equality for women in paid employment between the marginal values of household production, the marginal rate of substitution between child care and consumption, the reservation wage the marginal rate of substitution between consumption and leisure and the market wage rate. For each of these four marginal values we specify a separate equation. From the equilibrium condition we derive the optimal allocation of time between them.

The time allocation model and effect in household production

The model makes an assumption that women can derive utility from three goods: leisure, child care services and other commodities. Commodities are produced by women by combining market goods and time inputs. Child care services are measured in time input by the mother; hence these services are valued through the mothers time only.

Most of the women put their ability to work on two factors, and this are, the time factor and their budget.

Utility maximization yields the equilibrium conditions. These conditions state that in equilibrium the marginal value of housework and the marginal rate of substitution between child care time and consumption by the mother equal the net market wage rate. 2 Moreover, in equilibrium the reservation wage equal the market wage rate. Following Heckman in 1974 and Gronau in 1980, we specify forms for the market wage rate, the reservation wage, the marginal value of housework and the marginal rate of substitution between child care and consumption. From these equations we derive the equations for the time allocation on paid work, housework and child care by the mother.

Time allocation models provide a framework in which the value of household production can be estimated and the division of non-market time into different uses like child-rearing, housework, cooking, washing utensils and washing clothes can be analyzed.

Children have a significant effect on the marginal rate of substitution between child care by the mother and commodities but not on her wage income or on the marginal value of housework. Young children aged between 0 and 3 and between 4 and 5 years decreases the marginal rate of substitution of child care and increase the time spent on child care by the mother. The presence of older children decreases the time spent on child care by the mother. This can occur because women tend to delegate some work to the older children for instance the older children will take care of the younger ones in the house. A child between ages 0 and 3 decreases the marginal rate of substitution of child care by almost two hundred percent, while a child aged 13 or older increases it by one hundred percent.

The estimation findings do not show that there are economies of scale associated with household size. Children have no effect on time spent on housework, but young children do have a major effect on time spent on child care by the mother. The time spent on child care by women with young children apparently goes at the cost of their leisure time, not at the cost of labor supply.

Hours spent in a week on Work and Leisure by Men and Women, Age 25-64.

An hour of paid work raises the reservation wage by almost twelve percent. The inverse of the hours of work coefficient measures the wage effect on hours of paid labor. One percent increase in the hourly wage rate implies that the hours spent on paid employment per week increase by a little less than five minutes. Calculated in the mean value of the actual hours of work variable in 19 hours per week.

In particular the competing choices between job, household work, and leisure in analyzing why the substitution effects for women might be expected to be larger than those for men. The traditional interrupted careers of married women cannot be explained without reference to the shifts in household productivity that takes place when children are born and as they grow older. Labor supply over the life cycle is also affected by the way wages typically vary with age, causing inter-temporal substitution effect.

As forensic economists are well aware, the death or injury of a productive family member results in a substantial economic loss to the remaining members of the household. The real value of the person who has died to his or her to the existing household members cannot be measured with anything. A true fact is that, it is the economic contribution of the person who has died to the household, from the work they do both inside and outside their homes, but that individuals work performance is only known and recorded at his or her place of work, where there are various records of their production within the firm. However, there are various economists who continue to calculate the work performance of an individual within the circumference of their homes or the persons household production. However, the household production of women is not much counted for since it is more than that of men even when calculating using a single household production.

The crime detective literature shows that there are three general approaches for valuing the economic contribution of work in the home. The various methods that economists used to calculate the household production include the wage method, secondly there is direct output method and the third method is the direct output method which involves estimation and summing up of household production functions.

The calculation of household production using the wage quantity:

There are many economists who try to explain how to rate the household production by multiplying the various wages that the various individuals get and the time they spend doing that particular assignment. Classic studies have shown that have used this general approach.

The challenges associated with the housework remunerations methods are seen in three dimensions. First, there is the definite problem of identifying efficient housework remuneration. Some of the economists use the market wage labour to calculate the household production while others use the average wage rate of an individual that is engaged in any household production activity to value the labour unit by unit. ( Gauger & Walker, 1980).

More so, the woman economic contribution in the house is the value of work done within the house but not the value of hours she has spent working in any particular activity. Productivity in the home puts together labor with initial capital and other resources, just as production in the business sector does.

As womens labor wage increases over this period of time, there utility in the market labor also increase making their previously dominant substitution effect declining in importance and they have begun behaving more like men in their labor supply decisions. This therefore means that more women in society have gone to look for employment opportunities in areas where they think they can make a big and positive contribution in the company they are working and the society at large. Moreover, according to the theory of demand, it also depends also on the importance of earning as a source of income. If the total income were held constant then an increase in earnings would create only substitution effects. An example is found in comparisons of the consumption of employed and unemployed women. Unemployed women not only have lower income but also lower forgone costs.

Conclusion

The information availed by few countries to the public about the ability to transform raw material into finished goods and services continues to ignore the unpaid labor and economic output contributed by women and some few men who devote most of their time on household production. At least two over three of the work and economic production of women, half of the worlds adult population, is excluded. There has also been a substantial inference that the important sets of statistics currently used to measure work and valuable production are very incomplete and consequently quite misleading. Opinion of public aspects such as equality, labor market and gender policies, wages and income policies, to name a few, is statistically misinformed. The point is made frequently that the increase in womens participation in paid work leads to overstatement of the increase in measured economic activity, because the reduction in household production is not counted (Nordhaus and Tobin, 1973, Weinrub, 1974). Thus the day to day consideration of measurement of work and production activities is of crucial and important.

Reference

Gronau, R. (1986) Home production a survey, Elsevier science.

Wicks, J. (1990) Determining the value of household output: A comparison of direct and indirect approaches, New York, Economic Series.

Killingworth and Heckman (1986), Analysis of Wage Elasticity, international Business press.

Appendix

The graph interpretation is that, since woman A is not employed she takes is longer than woman B who is employed and earns more according to the graph than A(the distance at the x-axis between the point of origin and where A is situated is longer than the distance between the point of origin and B).

Introduction

Globalisation and post industrialisation are terms used to describe changes in nature of economic activity, globalised markets, growth in the service sectors and increased levels of productivity. Work in the current economy stimulated by globalisation seems to be different as compared to the old economy. New economy has brought about the invention of information and communication technologies (ICT) and easy circulation of information which has changed and created value to businesses. The new technology which globalization has brought about has increased the production of capital goods, stimulated capital investment and encouraged small firms to substitute capital for labour which has greatly influenced globalisation of markets, change in nature of work and increased the need for workers education and training.

Training offered in organisational basis can be both formal and informal. Participants are subjected to different levels of education depending on their personal preference, skill level of their education and family responsibility. Employers also influence employees on the kind of training to undertake. For instance, private and public sectors have different specifications, firm size may also influence and industry sector. Individuals who undertake training benefit from higher wages as the new technology appears to attract wage premiums (Ryan & Watson 2003, p.7).

Employers offer training to employees to improve job performances and quality of goods and services. Training is motivated by technological change. When employers offer training to employees, it directly or indirectly increases competition pressures, stimulates introduction of new technologies, introduces quality, centralises decision making in the organisation and increases work-reorganisation process. Investment in training activities stimulates higher levels of work productivity in many organizations and industries. New economy means additional training activities which individual employees may find it hard to afford (Ryan & Watson 2003, p.7).

Main Text

Information and communication technologies (ICT) have not shown uniform results on the nature of work in all occupations. For instance, the use of information and communication technologies in hairdressing occupations has only streamlined management information systems and put less emphasis on occupational change. ICT has positively influenced printing and library occupation as the standards and nature of work have increased tremendously in the sense that;

1. adoption of ICT as diffused in organisations has delegated traditional jobs to clients themselves. Such duties include photocopying, internet search engines, pre-press work and libraries. Traditional jobs have transitioned to become multi-tasked and lessen the time spent on one particular task rendering some workers jobless.
2. The emergence of electronic technologies have expedited the computerisation of production processes in printing areas and libraries thereby relinquishing traditional trade skills and other occupation duties supersede.
3. Workers have been forced to poses basic clerical skills and computer skills since most of the duties are computerised.
4. ICT has made boundaries of many occupations befog.

Globalisation has influenced the nature of work by developing new products and has facilitated production processes. Products developed from new technologies include internet databases and computerised printing presses. ICT has increased the speed at which processes and new products are developed and workers are forced to adopt to the changes being introduced. This meant that more sophisticated work was done easily and in less time as compared to the past (Ryan & Watson 2003, p.8). Through globalisation, enemy nations can easily spread propaganda through internet (Pillai 2008, online).

Education and training in the changing nature of work has revealed that ICT development has not provided uniform results across all industries and occupations because; a). Industries that concentrated on mass production process were mostly computerised and therefore workers require knowledge to effectively manage production and have the skills to solve problems of variant nature. B). workers need to learn new products and process before carrying out certain tasks c). Communication skills are highly valued in all organisations and occupations as interaction between workers and supplies has increased. Essentially, computerised skills has increased productivity and succumbed many aspects of production processes. Nowadays, many occupations require employees to have minimum education on production processes, acquire high level problem solving skills or cognitive skills, communication skills and basic clerical and computer skills as required by most jobs (Ryan & Watson 2003, p.18).

Globalisation is believed to be breaking down boundaries between nations, social classes and people while providing a flexible pathway for economic development that will improve the quality of life and raise living standards. It has replaced the old-fashioned state bureaucracy with a spontaneous global division of labour facilitating economic niche. Economic globalisation has stimulated ICT development characterised by creativity, flexibility and powerfulness and negatively transformed the economic sector beyond the power of human beings control as some of the incidents are inevitable. Globalisation has grown to be resistant making the new form of integrating global capitalism completely unanticipated.

This resistance has challenged the premises of economic as there has been an increase in income and wealth inequalities within countries since globalisation. Health inequalities have also been experienced within certain regions. Reports indicate that there has been a decline in population health since globalisation. There has also been reduced quality and access to education, human services and health care. Public utilities that have taken place in certain regions of the world as a result of commercialisation and privatisation have compromised quality of services. Processing sectors have been subjected to stressful and hazardous work conditions due to globalisation such as the export processing zones (EPZ) all over the world. Also, there has been crisis in the global governance as a result of withdrawal of the regulatory and protective nature of the national state and the up-rise in power of trans-national corporations (Johnson 2008, p.3).

Johnson (2008, p.3) argues that impact of globalisation has brought about persistence problems affecting the economic sector. From this statements, its evident that globalisation is fragmented, contingent, incomplete and a puzzling process. This is because organisation trends have been un-uniform in most occupations. From political economic policy perspective, globalisation has influenced both ideology and political economy regime, a term known as neoliberalism. Neoliberalisation fostered understanding and established new set of rules for the global economy as a result benefiting transnational corporations and the economic nobility. Neoliberalisation was earlier intended to achieve the restoration of class power but it brought trans-nationalisation of classes. These divisions formed new social hierarchies and inequality among people as they were driven into trans-national class relations.

Historically, divisions of classes meant workers were attacked in their workplaces and their protection and rights abused. Economic globalisation as a real force and ideology has stimulated the emergency of new business opportunities on national and international levels to a paramount class position from the past monopoly capitalism. The globalisation of economy has greatly impacted the dimension of work place such that many workers have been exposed to hard and longer working conditions for less compensation as it was in the past. This has made workers loose power over their daily lives as most of the activities are centralized in workplaces, society and globally. This isolation has made workers feel isolated and unprotected by ancient collective solidarity (Johnson 2008, p.5).

Post-industrialisation has replaced traditional mens work with service economy. These changing social and economic relations in workplaces have left men confused about their work related identities and their roles in the society. Men always want to feel masculine, in charge and dependable. Globalisation has therefore challenged their identity in the society as a whole. Modern men are experiencing identity confusion which increased the numbers of young male depression and suicidal rates and the rise of anti social behaviours. Researchers reveal that men have been worst affected by changing economic conditions. For example, the replacement of Britains heavy industrial base to service sectors increased unemployment rates among working class men. According to the 1997 film, The Full Monty, men who used to work in factories struggled to find their way into the light of a new economy (Archer 2003, p.8).

Due to large scale technological development brought about by globalisation, demand for unskilled labour has reduced as foreign investment has concentrated more on highly skilled workers. Tradition nature of work has diminished due to increased use of technology subsequently creating new and innovative occupations due to highly specialised professions in the new workplaces. Developing economies which were not unable to adopt new technologies experienced increased unemployment rates due to lack of new job openings and the decline in wage rates. Also, if the labour clause will be effected through the WTO, developing countries will experience negative impacts on the economic growth and employment rates especially in areas where child labour is prevailing and employees work under poor working conditions. Globalisation is not equally distributed in the sense that manufacturing-producing countries (developed) benefit more on trade liberalisation as compared to agricultural-producing countries (developing) who receive the smallest share. The emergence of privatisation has increased unemployment rates since its characterised by reduction labour demand as compared to public sectors (UNIFEM 2009, online).

The credit crunch experienced in 2007 to 2008 was influenced by globalisation and the worst affected areas were real state businesses in the sense that capital availability and flows within and outside economies were affected. Governments cannot fully control use of capital within their borders and they cannot also put aside their money supply from the implications of foreign capital. This means that a country cannot effectively control money supply outside its economy thereby contributing to credit crunch. Essentially, a country cannot stop foreign capital investment as investing countries would shift to other markets (Downs 2008, p.1).

Globalisation has brought about electronic commerce where customer services operate on 24-hour basis which required redistribution of jobs thereby creating additional workload. Electronic commerce also offers teleworking which reduces social interactions among workers, mixes up family and profession activities. Workers are interrupted at work for domestic chores, exposed to long working hours, experienced difficulty in maintaining company culture and formation of teamwork within the organisation. Tele-working has also been able to positively increase the flexibility in selecting time and place of work, reduced office operations costs and saved workers time from commuting as work is centralised contrary to earlier implications (International Labour Organisations et al 1999, p.63).

Trade union memberships are lower in small enterprise sectors where there is a high population of female employees. These sectors are characterised by high labour turnover rates and high proportion of workers are neither employed on full time nor permanent basis. The most affected industries are retail and wholesale trade. Unions are slowly losing members in developed countries meaning that workers rights are not adequately addressed. Globalisation has influenced offshore contracting which has greatly contributed to the decline of unionisation rates in clothing industry in the United States. This international subcontracting has subsequently affected union membership in low skilled production jobs in develop countries exposing workers to substandard working conditions (International Labour Organisations et al 1999, p.76).

In order for farmers to take advantage of niche markets, they need to be educated on specific quality traits, be informed on the comparative advantage in producing certain products and able to learn efficient and effective means of supplying the products. They should also learn how to arrive at economies of scale by working through cooperatives so that they can provide consumers with high quality products. Globalisation has stimulated public research which has assisted farmers on knowledge to help them survive in this emerging global economy. The disadvantage of this system is that the service provided is outreach for small scale farmers in developing countries, therefore workers may not benefit at all. Privatisation of public sectors reduces reliance on Extension and companies become more depended on private technical consultants which are very costly. Since public sectors have no access to information, it has become difficult for workers and firms to conduct resource inventories, able to undertake policy analysis and detect market failures in time (Reddy 2007, p.6).

Globalisation has had negative implications for women in developing countries especially in the African and Asian culture. International corporations on the other hand have become richer as the days go by. The worst affected population are women as they are exposed to longer working hours with meagre salaries. Research reveals that about two thirds of women are subjected to harsh working conditions and only earn 10 percent of the Worlds income and own minority of worlds property. Indian ecofeminist reports that globalisation and organisations such as World Bank and IMF have devised wage packages known as slave wages. He argues that these packages were created because global trade looked down upon the importance of peoples lives and work with emphasis on women.

In economic stimulus package, globalisation penetrated the rural areas for job developments with little effect. India for instance has been experiencing no employment in the rural areas; therefore development will greatly impact the lives of this people. The jobs allocated to women are always poorly paid, insecure, physically unhealthy, mentally challenging and degrading. Women actually suffer two fold; first, they are not relieved of their domestic responsibilities and second, they work in factories where payments are pathetic. This meant that globalisation increased the migration of men into cities, poor job opportunities and higher prices for goods and services which the poor could not afford. Also the mixture of corporate capitalism and Western culture models has crumbled family and community social controls as evidenced by high rates of family breakdown, rape, violence and divorce cases (Global 2009, online).

Noida Export Processing Zone suited in New Delhi has a high population of women workers as they are preferred to be more productive, easier to control and less likely to rebel against poor working conditions. Noida Zone is hot and unsanitary with no maternity benefits and no minimum wage and women who get pregnant or marry are fired immediately. Overtime is compulsory and no extra payments are awarded for extra hours and men are paid higher than women. In order to maintain their positions, women turn to unsafe abortions. Workers exposed to diseases such as anaemia, pelvic inflammatory diseases, dehydration and respiratory problems and the management does nothing to offer medical support (Global 2009, online).

Globalisation has made communication easier with the invention of mobile phones and internet access. Goods that were once confined to specific regions can widely be found across the globe and work can be outsourced to any part of the world through internet connection. There has also been improved infrastructure which has facilitated faster travelling. Developed countries have outsourced most white collar and manufacturing jobs to developing countries like China and India saving on the cost of manufacturing goods. Examples of outsourced jobs are accountancy, editors, scientist and programmers and many workers in developed countries have lost their jobs as a result of this. Globalisation has also exploited labour conditions subjecting prisoners and child workers to inhuman conditions. Industries ignore safety standards in order to produce cheap goods.

Before globalisation, people were stable and job opportunities were permanent. Since globalisation, people live in fear as they are likely to loose their jobs to competition. Increased job competition subjects employees to lower wages thereby lowering their living standards. Industrialisation has developed sophisticated weapons subsequently increasing terrorism activities as these weapons have enhanced their ability to induce damage. Also, Internet access has enabled terrorist easily communicate with their counterparts. Many industries have been set up causing pollution resulting to global warming. Benefits of globalisation are not uniformly distributes as the rich are getting richer while the poor are becoming poorer each day. The development of TV and Internet are spreading immorality from foreign cultures demoralising local cultures. The emergency of fast food joints such as McDonalds and KFC are spreading their wings to developing countries making people consume more junk foods exposing them to health risks (Pillai 2008, online)

Developed infrastructure has enabled faster travelling across different continents. Spread of dangerous diseases such as HIV/AIDS have been on the rise since good infrastructure enables travellers to move around the globe. Globalisation has enables foreign multinationals to take over local industries creating employment scarcity for unskilled workers. Human trafficking has been on the increases in search for better lives. Rise in commodity prices in developing countries has weaken government ability to control social welfare schemes. Multinational companies and corporations are moving away from commercial activities to influencing political decisions (Pillai 2008, online).

Conclusion

In conclusion, globalisation has greatly benefited mankind and one should not ignore its negative effects. The concept of outsourcing has opened job opportunities for people of developing world improving their living standards. Increased competition stimulated by globalisation has forced companies to lower prices making commodities affordable mostly to developing countries. ICT has increased media coverage thereby putting to spotlight human rights violation subsequently improving human rights.

Bibliography

Acher, L. 2003, Race, masculinity and schooling: Muslim boys and education, Mc-Graw-Hill International.

Downs, A. 2008, Securitization Hibernation, National Real Estate Investor, p.1.

Global 2009. Negative effects of Globalisation, Web.

International Labour Organisations, Sectoral Activities. Programme, & International Labour Organisation, 1999, Human resource implications of globalisation and restructuring in commerce: report for discussion at the Tripartite Meting on the Human Resource Implications of Globalisation and Restructuring in Commerce, International Labour Organisation, Geneva.

Johnson, J.V. 2008, Globalisation, workers power and the psychosocial work environment-is the demand-control-support model still useful in a neoliberal era?, SJWEH Suppl. 6, pp. 1-7.

Pillai, P. 2008, Negative Effects of Globalisation, Web.

Reddy, D. E. 2007, Impact of Globalisation on small Farmers worldwide: Implication on Information Transfer, WLIC, pp.1-7.

Ryan, C. & Watson, L. 2003, Skills at Work: Lifelong Learning and Changes in the labour market, Commonwealth of Australia, 03/14, pp.1-105.

UNIFEM. 2009, Globalisation and The Labour Markets: Research on Globalisation and Women, Social Research Centre, Web.

Abstract

Much can be said about the differences and similarities of the IMF and WB. But that is not the concentration of this paper. Instead, this paper shall concentrate and focus on the various functions that fall upon the International Monetary Fund as a part of the world economic foundation. Within the next pages, I shall discuss the three main types of the IMF function. These functions fall under the Surveillance, Technical Assistance, and Lending categories.

Introduction

During the closing years of World War II, nations across the continents found themselves in economic shambles after having been involved in a lengthy war on both fronts between the Japanese in Asia and the Germans in Europe. These smaller countries would need help in rebuilding their countries in order to have a viable and sustainable economy. It was this need for financing their needs that prompted the Brettonwood Convention in 1944 which led to the creation of the International Monetary Fund and World Bank, also known as the Bretton wood Institutions.

Differences of IMF and WB

Although founded upon the same principles, the IMF and World Bank actually have very different job descriptions.

1. The bank is actually the fund and the fund is actually the lender. It certainly gets confusing for most people to understand what the exact structure and job description of the entities are considering that their titles could not be any further from their actual job descriptions.
2. The World Bank is actually the development arm and does not lend out money. That money flow and disbursement are handled by the International Monetary Fund instead. Therefore each entity has a specific and different purpose and organizational structure.
3. The IMF has 186 member countries under its fold. These countries economic, monetary and financial policies are constantly being examined by the IMF in order to ensure that they can be properly advised regarding any policy adjustments that may have an adverse effect on the worldwide economy.

The importance of IMF Surveillance

1. The IMF is responsible for the policy adjustments, and in the cases when some problems appear should be responsible for regulating the activity. Such activity of IMF is known as surveillance.
2. Any action taken by the IMF during this activity mostly pertains to the possible risks both domestic and international, of specific countries monetary policies in relation to economic growth in the country and region.

Country surveillance

1. Surveillance activities are done in person by visiting IMF economists in various countries.
2. Person by visiting IMF meets with the most important members of a countrys economic sector  such as the central bank, in order to understand the existing policies and perhaps suggest changes on a case-to-case basis.
3. The main purpose of IMF Executive Board visits is to discuss and comment on a particular countrys economic policy.

Multilateral Surveillance

1. Multilateral Surveillance pertains to the review of global and economic trends.
2. Multilateral discussions are held in the form of a debate that is used in the development of policy actions so that regional economic problems can be properly addressed.

Technical Assistance

1. Technical assistance is usually given to countries that need to be guided in the use and proper management of their economic policies.
2. The IMF technical assistance is provided on the basis of various platforms such as macroeconomic policy, tax policy and revenue administration, expenditure management, monetary policy, the exchange rate system, financial sector sustainability, and macroeconomic and financial statistics.
3. The method by which this technical assistance is provided depends on the nature of the necessity. It can come in the form of staff missions of limited duration, placement of experts or advisors on a definite time frame of weeks, months, or years, or even as technical and diagnostic studies, training courses, seminars, workshops, etc.

An IMF loan

1. The countries in need of aid learn how to utilize properly their human and institutional resources so that they can develop sound, macroeconomic, financial, and structural policies with the help of the IMF.

Who can loan?

2. The loans are usually provided to member countries under terms of arrangement.

3. Arrangements indicate specific policies which the borrowing country plans to implement in order to meet their international debt payment requirements in the future. Such conditions are usually developed under the advice of or upon consultation with the IMF.

How to get an IMF loan approval

Once approved, the loan is released in tranches as the various economic development programs are undertaken by the borrower country.

Types of loans

1. The IMF found itself having to develop various types of loan instruments in order to answer the needs of the borrower countries.
2. Facilities are the Poverty Reduction and Growth Facility, Exogenous Shock Facility, Stand-By Arrangements, Flexible Credit Line, Extended Loan Facility, and Emergency Assistance.
3. Each loan facility is designed to meet the needs of a member nations loan and is used on a case-to-case basis.

Literature review

The area of investigation has been commented on Heakal Reem, David D Driscoll, and Sandra Blanco & Enrique Carrasco studies, who concentrate their attention on the International Monetary Fund and its difference from World Bank.

Methodology

The main methodological issue that was used is the literature analysis and the focusing on the International Monetary Fund in the Internet sites, consideration of the processes in the society which were backgrounds for International Monetary Fund appearing and its function and developmental processes.

Results or findings

1. Surveillance actions are important because of the way the economics of the world exist in a symbiotic relationship. Without an entity like the IMF to facilitate such a relationship, it will be difficult for these nations to find some sort of middle ground where everyone can effectively function.
2. The IMF finds itself involved mostly in multilateral and bilateral surveillance while trying to maintain a neutral stance on any issue.
3. It is believed that 90 percent of the IMF technical assistance benefits are enjoyed by the low to lower-income countries, as well as countries experiencing conflict.
4. The assistance provided allows the countries to enjoy a sort of economic buffer so that their weaknesses and vulnerabilities will not have too adverse an effect on the rebuilding of their economy.

Conclusions

1. The IMF provides free technical assistance to the countries that require it since about one-fifth of the IMF operating budget is allotted to this commitment.
2. The funding is sourced from various internal and external sources such as bilateral and multilateral donors.

Recommendations

It is not hard to see why the IMF is such an integral part of nation-building. Without the International Monetary Fund, it would be next to impossible to get nations to help each other out financially. It is that bartering ability that is so admirable and proves to be useful to all IMF member nations.

References

Blanco, Sandra & Carrasco, Enrique. The Functions of the IMF & the World Bank. The University of Iowa Center For International Finance and Development. 2007.

Driscoll, David D. The IMF and the World Bank: How Do They Differ?. International Monetary Fund. 1996.

IMF Lending. International Monetary Fund. 2009.

IMF Surveillance. International Monetary Fund. 2009. Web.

Reem, Heakal. What Is The International Monetary Fund? Investopedia. N.A. 2009.

Technical Assistance. International Monetary Fund. 2009. Web.

What The IMF Does. International Monetary Fund. N.A. 2009. Web.

The most distinctive features of the 1960s could be enumerated from the point of view of several social and economic factors like secularization, decontextualization, totalitarianism, mechanization, democratization and centralization. Along with that, there was the advent of individualism, linear progression, homogenization, diversification, hybridization, unification, industrial society, reductionism, universalism, subjectivism, alienation, rationalization, and bureaucracy, making Modernism a complex and intricate civilization and the post-war period of the 1960s accelerated the basic norms of this society and developed concepts that could well be termed as cultural revolution and rise of consumerism. Andy Warhols artwork, 200 Cans, represent this consumerism with a satire. However, it is true that Warhol is more known for the pro-feminist activities and deconstruction of the image of males it is true that Warhol made it clear from the artwork that there is a fundamentally wrong perception of the life of the 1960s period and that consumerism was the main cause of this perception.

As a prelude to the 1960s, the Second World War ended in a period of history that was a time when the world was going through a difficult phase after the horrors of the war. It could be mentioned in the initial stages that it was degeneration time. Imperialism had taken its tolls on the world, which was grilling on the last fires of WWII. The losses were too heavy, and the shocks, almost unbearable. People just lived through a test of the extent-organized cruelty, and purposeful ruthlessness could reach. As far as the future was concerned, the initial tremors of what would lead to a massive cross across the globe were being felt. In this context, it would be relevant to mention that the generation was not finding their existence worthwhile or in other words, they wanted more out of their life for they hardly knew what to believe. They were not able to keep complete faith in religion, and neither could they abandon it completely. Thus, while assessing the consumerist essence of the period, Spigel notes, it is in the activities concerned with the home and religion that the automobile occasions the greatest emotional conflicts (Spigel, p. 25).

It was also a regeneration time. Ideological conflicts and military interests were shaking civilization right up to its foundations. The doubts, dilemmas and confusions were gradually, quite slowly indeed, giving way to a new and unique cultural revolution. It was happening all across the Western world. People suddenly seemed to realize that there was enough political warfare to disgrace humanity. The prevailing standards suddenly seemed to be meaningless, and the insurgent youths wanted something different to happen. However, it should also be mentioned that the aspects of modernism were already on their way from the time of the industrial revolution and the birth of capitalism with the assistance of better education and communication means. These aspects were influencing the society, and its culture and modernism were on their way, but the circumstances of the war changed the acceleration of this change and formulated a rapid and revolutionary transfiguration.

This entire formulation gave rise to a whole new generation that was induced by the market economy and shaped by consumerism. It is already established that the media holds enormous power to influence the mass. Hannigan notes, The media were especially concerned with the issue of crowd order and control (Hannigan, p.23). The role of media (TV, Radio) was almost absent in strengthening the values of national culture and in highlighting cultural icons. Cultural programmes were shallow and did not deal with real cultural issues of the society. This would weaken the national identity of future generations. TV stations show programmes that deal with cultural and social issues of nations, which sometimes do not respect traditions and moral values of our society and negatively affect behaviours of young generations. This was a prime example of the weak contents of cultural journalism. The cultural issues that highlight the national identity are not deeply covered and dealt with on the cultural pages of local dailies, monthly magazines and other publications, which created general ignorance of history and national and cultural identity among the 1960s generation. All these reasons amalgamated into a scenario where the American society in the postwar period became a culture of consumption that in turn resulted in a homogenous, content, and conformist society.

This approach is best observed in the artwork of Warhol, 200 cans. The predominant colour red indicates the vibrant aspect of the consumerist attitude and the indication of the market economy present. Again, the name 200 cans means the availability of surplus consumer durables and the indication of the nature of the generation indulged. The cans are lined up and placed one upon another, and there is no way one can be distinguished from another. This is the result of machine-made, homogenously designed, similar articles where there is no chance of exerting individualism or any sort. This again reflects the consumerist attitude as the interest of the minority and individuality is fundamentally ignored. (Warhol, p.1) Thus, it is not a surprise that Lewis Mumford, in 1961, stated, A multitude of uniform, unidentifiable houses&.inhabited by people of the same class, the same income, the same age group, witnessing the same television performances, eating the same tasteless food. (McCracken, p.12)

Spigels text, Make Room for T.V.: Television and the Family Ideal in Postwar America, is the ideal text that defined this era. This text is a unification of interpretations about the era of the 1960s, and the author delivers the fundamentals that affected the nations and the shape of the modernization. In this text, it is clear that there was mass discontent among the civilians, and they tried to take every opportunity to show their distrust in the authorities no matter how much the state tried to tone down the social and intellectual disgruntlement. The text indicates that this was the vantage point that set the basics of modernism that would ultimately come to age at the end of the 1950s. In fact, the market induced economy became so fundamental during this period that the African American population, who were otherwise neglected from the mainstream economy, was targeted as potential consumers by the corporate and advertising trade journals throughout the 1960s assisted this corporation by featuring numerous how to articles concerning selling to African Americans (Weems, p. 318).

In conclusion, it would be relevant to mention that consumerist culture was an intensification of cross-cultural relations, initiation of fresh categories of perceptions and distinctiveness, which exemplify cultural conduction, the craving to get through and have the benefit of foreign commodities and ideas, take on innovative technology and practices, and plays a part in world culture. Thus, it could narrate the aspect of the basic issue of consumerism and culture as but a two-way approach. There the basic maxims of a capitalistic economy are taken into consideration at every step of formulating the strategies of marketing. It is obvious that the basic impetus of any business is to deal with the principles of profit and the methods of maximization of profit margin. Consumerist culture in the period from the time 1960s has been driven by improvement in technology, which has declined the expenses of trade, and business arbitration rounds, initially under the sponsorship of GATT, which led to a succession of concords to do away with restrictions on gratis deals.

Given that, the generation of 1960s, after the arrival of the United Nations and the Bretton Woods institutions, there has been a sudden increase in the attainment and influence of Multinational corporations and the fast expansion of global civil society. Neo-liberalism became a tag for economic laissez-faire during the 1960s that explains government policies intended to endorse liberated competition between trade firms inside the market, particularly liberalization and monetarism, which is distinct from cultural consumption, which generally refers to greater international cultural exchange, dissemination of multiculturalism, and enhanced individual access to cultural diversity. On a broad spectrum, neo-liberalism corresponds to a backoff from Keynesian economics that was prevailing without more ado during the 1960s. All these aspects formulated a society that was completely aligned with the evaluation of Lewis Mumford, and it can be rightly said that Mumfords description accurately reflects American society, and the postwar consumption culture resulted in a homogenous, content, and conformist society. An artist protests this form of the ramification of the cultural society as an artist is supposed to be the custodian of this essence, and Warhol did the part of an artist to manifest a feeling against consumerism with the artwork 200 cans.

Works Cited

1. Hannigan, John; Fantasy City: Pleasure and Profit in the Postmodern Metropolis; (NY: Routledge, 1998)
2. McCracken, Grant David; Culture and Consumption II: Markets, Meaning, and Brand Management; (Indiana University Press, 2005)
3. Spigel, Lynn; Make Room for T.V.: Television and the Family Ideal in Postwar America; (Chicago: Univ. of Chicago Press, 1992)
4. Weems, Robert E; The Revolution Will be Marketed: American Corporations and Black Consumers During the 1960s; Consumer Society in American History; Lawrence B Glickman; (Ithaca and London: Cornwell University Press, 2003)
5. Warhol, Andy; 200 cans; vw.vccs; 1962;

Introduction

Technological development has led to major changes in the lifestyle of the world population. This has had a profound impact on economic and social life. This paper seeks to establish the global and regional trends of urbanization, development, and inequality, based on data findings.

Analysis

According to the findings, China had the highest percentage of value-added as % of GDP industry at 48 % in 2007, followed by Norway at 45%, Nigeria and Republic of Korea tied at 39%. Thus using industrialization as a measure of the rate of urbanization, these four countries appear to be the most rapidly urbanizing. The level of urbanization appears to be converging for countries in the same regions, for instance, European countries have generally high levels of urbanization as compared to African and Asian countries. Both divergence and convergence trends in urbanization can be observed for different regions. For Example, North American and European countries appear to be converging but show divergence when compared to African and or some Asian countries.

From graphical analysis a relationship can be drawn between levels of urbanization and economic development and growth, social development, social inequality, and environmental stress; countries with high levels of urbanization generally show high levels of economic growth as measured by the PPP GNI $ per capita. This mostly comes from the industry and service sectors, for instance, the United States has an 80,8% urban population and a PPP GNI per capita of $45,850. The same relationship is observed between urbanization and social development. Highly urbanized countries have high income and therefore offer better social services, these countries show better equality practices with some having a comparatively greater percentage for girl child enrolment in the primary and secondary schools. Countries with low levels of urbanization also show less economic development and have poorer social development but may show good progress in tackling gender inequality. For instance, Tanzania has a 24,2% urban population, a PPP GNI per capita of 1,200, a ratio of 97% girls to boys enrolment in primary and secondary schools (2006) and an under-five mortality rate per 1000 (2006) of 118. Thus poorer countries have lower rates of urbanization and are not sufficiently equipped to deal with social development issues.

The level of urbanization in a country is directly proportional to the level of environmental stress exerted by that particular country as measured by carbon emission. This is because urbanization accompanies the development of the industry sector. Highly urbanized countries such as the United States exert high levels of environmental stress. Generally, countries with a high value-added as % of GDP industry as shown by the 2007 statistics, have high levels of carbon dioxide emission per capita metric tons. Less urbanized, less industrialized countries emit comparatively low levels of carbon dioxide.

In this section, Canadas overall picture regarding global urbanization, development, inequality and environmental trends will be analyzed. Canada has an 80,1% urban population as a percentage of the total population and therefore is one of the most urbanized countries in the world. For the 32 countries analyzed only 6 had higher percentages of urban population than Canada, most of them with a small margin of between o.1 to 4%. The country has a high level of economic development with a PPP GNI $ per capita of 35,310 (2007), which places it at fifth position among the 32 countries that were analyzed. Its gross domestic product per capita growth is however one of the lowest, statistics show that there was a 1.7% increase for the period 2006-07. A large percentage of its income is drawn from the service sector (69.1 %) followed by industry (28.8%) and lastly agriculture at 2.8%. However, statics collected in 2004 shows that the country has the second-highest carbon dioxide emission per capita metric tons (20.0).The data taken previously also indicate that Canada has a high life expectancy at birth for females (83 years as of 2004), a 98% ratio of girls to boys enrolment in a primary and secondary school as of the year 2006 and an under-five mortality rate per 1000 0f 6 as of the year 2006. This indicates that the country has done fairly in the provision of social services and tackling inequality.

The urban population is likely to grow fast in countries whose industry sector is developing fast. Such countries include China, Norway, North Korea and Nigeria. This indicates the South East Asia region will witness the fasted urbanization in the future. Other factors too also contribute to rural-urban migration; the search for better jobs may be responsible for a higher rate of migration, especially in the developing world.

Continued urbanization will inevitably lead to more environmental stress due to crowding and carbon emissions. It will also lead to increased social and political inequality as countries will concentrate on the majority of urban dwellers and neglect the rural populations. However, urbanization may lead to increased economic output through the development of the service and industry sectors.

Conclusion

As the world continues to urbanize and seek new ways of economic development, profound effects on the environment, social and political life remain to be seen. It is the duty of the various countries to ensure that all efforts are geared towards ensuring that all these activities do not compromise the safety of future generations.

Reference

Pacione, M. (2009). Urban Geography: A Global Perspective. London: Routledge.

Definition of market failure

Market failure is an economic theory where the allocation of goods and services in a free market mechanism is inefficient. That is in the inefficient allocation, there are some players whose gains outweigh their losses while for other participants, their losses outweigh their gains. Market failure can be termed as a situation where the individual market players pursuit for self-interest results into inefficient outcomes. Keynesian economists believe that inefficiencies can be corrected by government intervention in trade and have advocated for government intervention in the market (Arrow, 2001).

There are various factors that have been linked to market failure, they include: monopolies, externalities, public goods, and merit and demerit goods. Economists and more so micro economists have always raised concerns over the causes and the solutions that can be developed to solve market failures. Such analyses have been critical in shaping public policy decisions and studies. Nonetheless, some of the policy interventions that have been advanced by governments such as: subsidies, taxes, price and wage controls, bailouts, and regulations among other corrective measures have often resulted in inefficient allocations (Arrow, 2001).

• Monopolies in the allocation of resources, monopolies do not often pass the benefits of the economies of scale to the final consumer and this leads to inefficiencies and market failure.
• Public goods these are goods and services that are non rivalry and non excludable; that is the consumption of the good by one person does not limit the availability of the good to other persons and that there is no effective way that can be used to limit the consumption of the good by the other persons.
• Merit and demerit goods merit goods are goods that are often undervalued by the society and result in under consumption under a free market; often, the goods have a positive externality. On the other hand, demerit goods are goods that the general public ignore their costs and thus a free market situation may result in the over consumption of the good. The goods often have negative externalities.
• Externalities these are spill over gains or costs that arise from the consumption or production of certain goods and services; these costs and gains are often not transmitted through prices.
• Immobility of factors of production these occurs when there are barriers to the transfer of the factors of production from one industry to another or between different occupations. Often, this results to factors of productions being used in an economically inefficient manner.
• Imperfect information in order to make efficient choices, all the players in the market requires complete information. Imperfect information results in a misallocation of resources and the likelihood of market failure.

Free Markets and Market Failure

In free markets, market failure occurs when the markets functioning without any form of government intervention, are unable to allocate resources in an efficient manner. The competitive forces are unable to deliver an efficient outcome from the general view of the society. The free market presents some benefits to individuals and business for undertaking certain business activities; market failure occurs when these benefits diverge from the individuals and businesses to the entire society. Paul Krugman, a Keynesian economist describes it as the situation where an individuals pursuit of self interest results in effects that are harmful to the general society.

In a perfect market, market failure occurs because all the essential assumptions are not achievable in the real market situation (Arrow, 2001). The free market may over produce or under produce a good because of the existence of externalities and rivalry among other features. This implies that the goods have the capacity to be used by more than one person without increasing the costs; this makes the production of the good undesirable for business reasons. Therefore, the demand for these products is reduced resulting in the failure of the market. Other factors that have been attributed to market failure include: inadequate provision of public goods by the government, under provision and over provision of merit and demerit goods respectively, and the abuse of monopoly powers.

Externalities

Externalities refer to the spill over gains or costs to persons who did not originally consent to the production or consumption of the product that caused the costs or benefits (Varian, 2003). The benefits and costs can either be positive externalities and negative externalities respectively. Thus, the existence of an externality in a competitive market implies that prices do not depict the full costs and benefits that are incurred in the production or consumption of the goods with externalities. Therefore, the producers or consumers do not incur total costs or derive the maximum benefits of producing or consuming the product. This often results in under production or under consumption of the good.

There are four major solutions that are provided to eliminate the problem of externalities:

1. Criminalization- this has been implemented in various cases such as in the prohibition of unlawful drugs and criminalization of commercial scams.
2. Civil Tort Law
3. Government Provision- the government may provide facilities that are not commercially viable such as national defense and education.
4. Pigouvian Taxes or Subsidies- these are taxes that are imposed to eliminate negative externalities; the taxes are equivalent in value to the externality.

Reference List

Arrow, K. (2001) Economic Welfare and the Allocation of Resources for Innovations. New York, Princeton University Press.

Varian, Hal R. (2003) Intermediate Microeconomics: A Modern Approach. 3rd edition. New Delhi, East-West Press.

This article is about the major challenges that face Long Island and the various issues that accompany these challenges. The author of the article is Martin R. Cantor a director at the Long Island Economic and Social Policy Institute at Dowling College. The article focuses on transport, taxation, education, poverty, land and immigration challenges in Long Island and how they affect economic growth. The author shows that these issues are interrelated.For example; the problems of transport and environmental conservation are interrelated. The author explains that each of these challenges is complex and is affected by social, economic and political factors and their solutions need to take these factors into account. He also discusses each problem, provides possible solutions and gives the justification for these solutions. For example, the author supports the proposed Brentwood transportation hub because it would result in a reduction of the amount of traffic by about 7,000 cars from the Long Island Exchange daily. The author also challenges Long Islanders to embrace change and to understand the challenges that face them in order to choose the best solutions for them.

All these issues need resources for them to be solved. The major economic claim still applies; human wants are infinite while the resources available for satisfying these needs are limited. On the transportation issue there is traffic congestion and the roads are not expandable. A possible solution is the construction of the Brentwood transportation hub. This would require capital investment by the government. The money invested in this could be used instead in Education. Environmental conservation would require setting apart more land from human settlement. This in turn will reduce the supply of land for housing resulting in higher housing costs. There will also be less land for business activities. Allocating more resources on tackling illegal immigration may cut spending on government purchases of land for preservation. Investment of resources in one area means less or no investment in another. Finally all these needs compete with each other and various groups will lobby for their problem to be solved first. There is a need to best prioritization, proper planning and prudent spending in order to maximize the available economic resources (land, manpower and capital) and maximize economic growth.

The Transportation industry plays a crucial role in economic growth and development. Transportation infrastructure not only creates employment but also facilitates growth by reducing transport and communications costs, facilitating trade and wealth creation and population integration. Investing in more roads would be advisable to help reduce traffic congestion. However the amount of road construction should be the minimum possible in order to conserve the environment and maintain the natural scenery. Policies that help in decongestion should be formulated. For example, the authorities could designate special lanes for cars with multiple passengers to encourage car pooling. Sustainable mobility will reduce wastage of working hours, reduce the consumption of oil in Long Island and improve the balance of payments (the difference between the value of imports exports and value of exports).

Immigration is still a contentious issue in America. It touches on social economic issues like employment opportunities, human rights, government expenditure, and exploitation of migrant workers and so on. Surveys indicate that the American public is very concerned about the illegal immigration situation. There are many ways in which people can immigrate legally into the country such as, being sponsored by a relative who is a citizen, applying for refugee or asylum status, employment based preference, through diversity legislative policies and more. These avenues should remain open. In contrast, illegal immigration should be reduced as much as possible. The government should also use immigration policies to encourage immigration by individuals who possess job skills which are in demand by the Long Island economy.

About 47 percent of people worldwide live in urban areas and according to the United Nations Population Division; this figure is predicted to increase to over 50% by the year 2015. The accumulation of people, their consumption patterns, travel behavior and their urban economic activities have a large impact on the environment in terms of resource consumption and waste disposal. There should be laws that protect the environment from degradation as a result of human activities. Zoning policies should be put in place to keep areas of Long Island from human encroachment.

This article is quite well written and covers each of the problems concisely. The author also backs up its claims with reasons and facts. However in some areas insufficient analysis was done and more information should have been provided. For instance, the issue of environmental preservation was discussed sparingly. The issues of taxation, education, immigration, transport, taxation, and environmental pollution are crucial and face every government and local authority. It is the responsibility of the government and local authorities to establish the optimal policies to tackle these problems with the limited resources available.

Introduction

In the broken window fallacy, we see the baker losing the window in which he has to part with some fifty dollars to repair it. This loss incurred by the baker turns out to be a gain by some glazier, thus boosting the glass business. This implies that a loss encountered by one party turns out to be a gain to some other party (Hazlitt, 1946).

However, the fifty dollars that are now to be spent on repairing the window would have been spent on something else and in this case, buying a suit. And since the resources are limited, the baker has to make a choice to forego buying a suit and spend the available amount of money, fifty dollars, on the window repair since this seems to come on top of the list of preferences.

But this choice of repairing the window will have to affect some other invisible party in a negative way. The tailor who had to sell the suit to the baker at a cost of fifty dollars will not be able to gain this amount of money. The breaking up of the window has affected him or her in a negative manner.

The Economic Terms

Resources

These are things that are required so as to survive or prosper or achieve a particular goal (Anon, Resource, 2009). These things are scarce and limited in their supply. Therefore, one has to come up with a list of preferences and make a choice on what to satisfy first and forego the rest. In the case of the broken window the baker has only fifty dollars to spend. He has to choose between repairing the window and buying a suit. But since repairing the window tends to be more important because he has to protect his commodities in the shop, he will have to chose this and forego buying the suit. This is because he has limited resources and he can not have the suit and at the same time repair the window.

Cost

This is what one has to give up in order to get a resource. Relating this to the case of the broken window, the cost of having the window repair is said to be fifty dollars. This is the same cost of buying a suit.

Opportunity cost

This is the value of what one can not be able to buy because he or she has bought something else (Anon, Economics: Opportunity cost, 2002). For instance, in the case of the broken window, the opportunity cost of buying a suit is the cost attached to repairing the window which is fifty dollars. The baker has to forego buying the suit and repair the window.

One of the five big ideas

Here we base on the first idea that suggests that choices involve tradeoffs and that choices are always made by giving up one thing in order to acquire the other (Anon, Basic terminology in Economics, n.d). In the case of the broken window, the baker has to give up buying a suit in order for him to have the window repaired. This comes about as a result of the scarcity of resources. Since the baker does not have adequate resources for him to have both the suit and the window repaired, he will have to come up with a list of preferences to chose between repairing the window and buying the suit.

At the moment, repairing the window calls for immediate action in order for him to protect his shop and therefore he will have to make this choice of repairing the window first and the suit will have to wait until some other future date (Hazlitt, 1946).

Current example of Henry Hazlitts ideas

The ideas given out by Henry Hazlitt are very much applicable in the current world. Whenever there is destruction, there are always those people who benefit from this destruction. For instance, there have always been cases of earthquakes and tsunamis occurring in various parts of the world. The people affected are not always prepared to have come up with a budget for the destruction associated with these calamities.

On the other hand, once these calamities come about, these people have no any other choice but to set up new buildings and carry out the repair of all the vital structures that enable them to lead a normal life. The resources that they had initially planned to employ in other undertakings are compulsorily devoted to the repair. This comes about as a result of the scarcity of resources and these resources are limited in supply. As much as the affected people undergo losses, the suppliers of the building materials and the construction workers benefit from this. The demand for the building materials go up and in turn triggers an increase in supply.

To conclude, in economics, people are always striving to satisfy their needs by using the available resources and these resources are limited. Therefore, the only option is for one to come up with a list of preferences in order to be able to know what need to satisfy first. So, this brings about the issue of one making choices.

Reference List

Anon. (N.d). Basic terminology in Economics. California: TUI University.

Anon. (2002). Economics: Opportunity cost. Web.

Anon. (2009). Resource. Web.

Hazlitt, H., (1946). Economics in one lesson. New York and London: Harper and Brothers.

The human resource department is a very important section in an organization as it enables the organizations top management to conduct its functions perfectly with little amount of shortcomings being reported, this is because the top management uses these department to recruit qualified professionals who will perform their tasks without any mistakes.

In order for the company has to achieve its success in the market; it has to be able to maintain its finances properly and this plays a big role in enabling the organization to achieve its goals in providing drugs to its customers. The human resource department through the accounting department has to cooperate in order for these goals to be achieved.

Washington DC is a state in America with an approximate population of 599,657 people, according to the census that was conducted in 2000; with a geographical measurement of 61.4 square miles (159 km²) land and 6.9 square miles (18 km²) water. Its growing economy that increases yearly due to the increase of the professionals in the area that enables the growth of businesses and jobs in the place (TheTimes, 2010).

A recruitment agency in Washington DC would easily conduct its duties, only if the firm is well acquainted with the professional level of the population of the state and their work culture; the large number of colleges and universities in the region is a clear indication that there are a large number of qualified personalities in this region.

The region has different types of businesses premises operating in the region, attracting a large number of customers and investors in the region, ranging from medical companies, law firms, private business amongst other service providers. In accounting the companies are supposed to use the HRM department in order to be able to come up with the most qualified accountants who will reduce incidents of the companies experiencing loses (Lundberg, 2009).

The Bond Beebe Accountants & Advisors PC is one of the most notable accounting firm in Washington DC, founded in 1932 by Lewis F. Bond, it offers accounting services to clients. located in the 4600 East West Highway, in the city of Bethesda; the company offers Accounting & Assurance, Tax Compliance & Planning, Forensic Accounting and Wealth Management services to its clients and companies in Washington DC and its environs (Lundberg, 2009).

Recruitment agencies in Washington DC are currently providing the clients with efficient services, especially in the field of accounting, because they recruit qualified accountants from the region based on their educational qualifications, and these individuals can perform functions like creation of financial records of business transactions, (Lundberg, 2009) checking the flows of finances, book entering, it also enables the process of creating wealth in an organization and evaluating the financial position of a company at a given moment (Lundberg, 2009).

It is through these recruitment agencies with the help of the HRM department will enable the agency to provide adequate services to its clients who want to acquire qualified accountants for their companies as this will facilitate the growth if these companies that have qualified accountants to provide these services, (Siegel, 2000) many organizations and celebrities who dont have accountants in their originations opt fro consultancy from the Bond Beebe Accountants & Advisors, who provide them with solutions to there problems.

I would advocate for the computerization of the services to be used by the staff, in attempts aimed at reducing incidents of misinterpretation, fast delivery of services and lose of vital data from the system as ways of modernizing the companies output, this is because most of the book entry is done one the computers and there is only need to retrieve the information once it is needed (Siegel, 2000).

References

1. Lundberg, J. (2009). Accounting And Other Disciplines: How Does Accounting Integrate With Other Disciplines Such As Economics Strategy And Organization?
2. Siegel, G. (2000). Management Accountant Roles on cross-functional teams, practice analysis-strategic finance.
3. TheTimes. (2010). The Accounting Department: Its Functions and Roles In An Organization.

Abstract

China has experienced tremendous growth since the invasion of foreign direct investments. By allowing foreign investors to establish themselves in the country, the economic environment of the country has experienced positive change therefore putting the country at a higher growth level than other developing countries. The paper mainly focuses on how foreign direct investments in china have influenced the workers of china by cutting down on the level of exploitation that was being experienced. As the country has always had a high population growth, the few available industries would subject the workers to harsh treatment that workers have to get submitted to because of their desperate situations. All this changed when the government introduced incentives that were aimed at attracting foreign investors.

Introduction

China unlike the other developing countries has been experiencing a large influx of foreign direct investments (FDI). This has therefore made the country to grow at a much faster rate because the government takes advantage of the immerging opportunities to expand its trade links. With the continued procedure it is clear that chinas gross domestic product will continue to increase over the years. According to OECD (2002), China is one of the countries that have continued to experience a rise in the population growth. The country has therefore been experiencing the challenge of feeding and managing its people. The invasion of foreign investment is something that has been advocated for by the government as a means that will help the nation to provide employment opportunities to its people. The large population with minimal job opportunities made the few companies available to take advantage of the people. The people were expected to do a considerable amount of work with little payment. The people who were desperate to earn a living were therefore faced with no alternative but to survive with the little income. The paper looks at the findings that prove that foreign direct investments have reduced the level of exploitation among Chinese workers.

Literature review

A study that was carried out by UNCTC (1992) revealed that foreign direct investments have boosted the economy of the county and has been a great relief to the people of china. China has been a destination for foreign investors who are assured of being granted permission to invest and also benefit from its cheap land available of labor. Investors are not only assured of the governments protection but also from the fact that they will not lack manpower to work in their companies. The more investments that are made in the country, the more job opportunities are provided for the people. This generally means that the workers that have been working for the other companies can relocate and go to other well paying companies. Foreign investors are usually interested in quality performance and will hence look out for experienced workers to work in their companies. They also promise them good remuneration packages which are far much better than what their local counterparts can offer them. This in turn increases fear among local investors who continually loose their competent labor for foreign investors. This fear also makes them to treat their workers better and also give them good returns for their labor.

Foreign direct investments have hence boosted the living standards of the people of china who have not only benefited from employment opportunities but also the invasion of foreign technology. The workers that had the opportunity to work for foreign companies were given technical training. They therefore made them to adopt some of their technology which enabled them to establish their own industries. The workers who had to probably rely on their meager earnings for survival were able to make more money through their established industries. The availability of such alternatives has made the companies to be more lenient in the way they treat their employees. This has also in turn helped the country to be able to provide better social amenities and infrastructure for their people through the extra income they receive in form of taxes and duties.

In the book by Henley, J et al (1999) we find that foreign direct investments, originally immerged in china in 1979. During this period, the growth rate was slow and not many investors were attracted due to poor infrastructure. Later on between 1983 and 1991, the influx reached its peak as the investors identified economic zones that would give them a good return for their investment. The government took keen interest in foreign investments and hence made improvements in their infrastructures (Hood & Young, 2000). The government introduced FDI incentives in 1983 that were aimed at motivating investors to carry out their businesses in the country. This initiative bore fruits and by 1993, the country was identified as the largest in hosting foreign direct investments. Due to increasing number of foreign direct investments, the country adjusted their entry in 1994, the foreign direct investments however continued to boost the economy of the country and by 2001 china had recorded a fifteen percent increase in foreign capital.

Methodology

In the research methodology, a study was carried out to find out on the impact of foreign direct investments in china in relation to the Chinese workers. Interviews were carried out to determine how workers have been able to benefit from foreign investment procedures. There are various research methods that were used which include primary and secondary data. Historical data was used to compare how the workers were treated in the past years and the various improvements that have been made since then. In carrying out the research, the researchers visited a wide variety of companies such as manufacturing companies, business institutions and textile industries. Interviews were held for both skilled and non skilled workers in the effort to find out how they were being treated. A total of twenty two companies were used for the research where by ten of them were visited personally. Other statistics were obtained from twelve other companies through materials that were obtained from secondary sources. From the number of skilled workers that were interviewed 20% of them had been working for the past twenty year and were hence acquainted with the changes that had taken place in the employment sector since the immergence of foreign direct investments. Textile industries that were known to exploit their workers by making them work more and yet received less in the past years were selected for the research. The invasion of foreign investments into the country made the local companies to increase their salaries by 20% annually as most of the workers were being taken by foreign companies. Few workers that worked in Chinese companies some years back and retired were also interrogated in an effort to compare the amount of work they did, the number of hours they worked per day and how much they were compensated in return. We also sought to find out whether the amount of money that they received was enough to cater for their general family needs.

The data was collected through personal interviews either in person or through phone calls. We also managed to pose similar questions in the internet and received responses via email. Some companies were also able to give us some of their data that reflected how they paid their workers before the influx of foreign direct investments and how the same can be compared to how they are currently paying them. Apart from finding out how they benefited from increased remunerations, we also sought to find out if increased remuneration has motivated the workers into high productivity.

Personal interviews were done on the retirees and 80 percent of them admitted that they had to work for long hours yet what they received was not enough to take care of their family needs. Due to unavailability of convenient means of transport, they were also forced to walk long distances to their places of work and also carry food as they were given little time for breaks. 20% of them said that they had no time to see their children as they arrived home when they were asleep and left before they woke up. This was thus having a negative impact on their family. Shop floor workers were interrogated orally as a group and 85% of them said that their employers were treating them fairly with the fear that they will easily relocate to other better companies. The result differed from different cities of china and good working conditions were observed especially for those working in major cities. 90% of those that were satisfied with their current pay and the working conditions were recorded in Shanghai, Hong Kong and Taiwan. The results were mostly positive for the employees that worked for foreign direct investments, those that were working for Chinese companies were still complaining of poor pay and working environment even though it had shown improvement in the past five years. Compared to foreign direct investments, the companies rewarded them with an average of 5% salary increment annually which is barely enough for their needs.

Timetable

The table below shows the improved working conditions in china since the influx of foreign direct investments between 1979 and 2005.

The rankings were done as follows

1. poor
2. fairly good
3. good
4. better
5. excellent

Discussion

From the study that was carried out, it was found out that foreign direct investments had an impact on how the workers were subsequently looked at in china. Foreign direct investments came up with alternative employment opportunities that the people of china benefited from. Apart from the workers that were employed in such foreign entities, the government was obliged to make more constructions especially on the roads which meant that the Chinese people would also benefit from such extra employment opportunities (UNCTAD, 2004). The few local entities that the people were previously fighting for to get employment opportunities despite the poor wages and salaries that they received faced an exodus of employees. Foreign companies took in some of the experienced workers who obliged to leave their former companies as they were promised good remunerations. The local companies therefore had to pull up their socks before all employees left for other well paying companies. They had to increase the remuneration packages for their employees so as to fit in the prevailing competition.

With the emergence of foreign units in the country, the transport and communication system was improved. All this was done in the effort of the government to attract more foreign investments. The living conditions of the people was subsequently improved as they were able to access important facilities like health care, transport and schools more easily. Life also became manageable for the masses that had greatly benefited from good wages and salary. It also increased innovation and invention in china as people studied the technology that the foreign companies used to carry out their businesses. After some time, the technology was transferred to other local undertakings as others launched into cortege industries. The skills that were gained by the few individuals were transmitted to other individuals who realized that they could manufacture some of the products and commodities that they were importing. As the locals engaged into such manufacturing industries, the locals were able to obtain commodities at a cheaper price and thus reducing on the expenses that were involved in having to import such commodities.

In the words of Sun, Q. et al (2002) foreign commodities and services were also easily available to the people as the industries that manufactured them were located within their reach. They therefore had the advantage of obtaining such services first hand and at a much cheaper rate. It was also during this season that labor laws were introduced. With the increase of the people now working in china, the government was obliged to introduce laws that would be beneficial especially to the workers. The majority of people were now working and therefore held the economy of the country in their hands, they were able to come together to form unions that were aimed at pushing for the government and their respective employees to meet their demands. They therefore demand for a reduction in the number of hours that they worked per day. Earlier on, the employed had little time to spend with their families as they were expected to arrive at their places of work early and leave late. But as they jointly pushed for their demands, the government intervened by introducing labor laws that were to be adhered to by all employers.

Buckley, P. (1995) observed that some of the people also had the opportunity to travel abroad and experience life out of china. Foreign companies would either grant some of their best performing workers opportunities to study further or to work in their companies that were located outside china. This experience enabled them to learn many things that they would have otherwise never known had they remained in china. They had the opportunity to stay with other people that were not necessarily Chinese and hence acquired a lot from them in terms of carrying out businesses. They hence came back to their countries empowered and ready to change their lives tremendously. This was a period that saw a large percentage of them going outside for higher education. This improved their skills that made them even more informed of their rights. The more intellectual people become, the less they are exploited, this is due to the fact that education comes in with courage and confidence that enables one to defend themselves incase of a crisis. The people were therefore more informed and thus making the workers to demand for a fair treatment for the services they provided to their companies.

Conclusion

From the above analysis we come to realize the level at which Foreign direct investments have impacted on the working population of china. The people of china decided to embrace foreign entities with the hope that their economy will improve substantially. Despite mixed reactions that suggested that the invasion of foreign investments would drain the local industries and probably interfere with the cultural settings of the land, the country embraced the change. As a result, the country has been rated as one of the most industrialized nations. They did not only work for the western companies but aspired to gain something extra by acquiring the skills that they needed to establish their own. Even though there are still a large number of foreign entities in china, the country has also been able to establish their own industries both locally and internationally (Hood & Young, 2000). Most cities of the land are also well served with modern means of transport and communication. This has made easier for the country whose population is continuously growing to be able to feed the masses. Despite the other challenges that the country has to overcome with the invasion of foreigners, it has a lot to celebrate in terms of development.

List of References

Buckley, P., 1995. Foreign direct investment and multinational enterprises. London: Macmillan Press Ltd.

Henley, J., Kirkpatrick, C. and Wilde, G., 1999. Foreign direct investment in China: Recent trends and current policy issues. Oxford, UK: Blackwell publishers Ltd.

Hood, N. and Young, S., 2000. Globalization, multinational enterprises and economic development. USA: St. Martins Press, Inc.

OECD, 2002. China in the world economy: Working papers on International Investment.

Sun, Q., Tong, W. and Yu, Q., 2002. Determinants of foreign direct investment across China. Journal of International Money and Finance, 21(1), pp.79-113.

UNCTAD, 2004. The shift towards services. New York: United Nations paper.

UNCTC, 1992. The determinants of foreign direct investment: A survey of the evidence. New York and Geneva: United Nations.

Appendix

Questionnaire

1. Name of the correspondent:
2. Company worked for:
3. The period in which the correspondent worked for the company:
4. The amount of salary that the correspondent earned when he or she joined the company:
5. Salary at the end of his/her term period:
6. The number of working hours before 1979
7. The number of working hours between 1979 and 1985:
8. The number of working hours between 1986 and 1994:

Questions to be answered by Workers who are still employed

1. Is there a difference on the kind of treatment you are given as employees compared to five years ago?

   1. Yes
   2. No
2. Do you get enough time to be with your family?

   1. Yes
   2. No
3. If you had an opportunity to relocate from you current job, would you gladly do so?

   1. Yes
   2. No
4. If the above answer is yes then why?
5. With the immergence of FDI, can you really say that exploitation of workers in these companies has been completely done away with?

   1. Yes
   2. No
6. As an employee on an FDI, what more are you benefiting from apart from good remuneration packages?

To be answered by retirees

1. How can you compare life when you were still working and now?

   1. Extremely satisfied
   2. Somewhat satisfied
   3. Neutral
   4. Somewhat bad
   5. Extremely dissatisfied
2. How did the working conditions impact on your family?

   1. Very Much
   2. Much
   3. Not Much
   4. Not at all
3. Considering the distance you had to travel, how did you manage to arrive to work and back home on time?
4. Looking at the current working class, can you say that things are better now?

   1. Yes
   2. No