...half million workers all across China. Foxconn has become an economic threat to both China and America. Their cheap foreign labour reduces enconomic growth to both countries. The labour share of national income has been decreasing across the world since the 1980s. Countries affected include South Korea, Germany, Japan, Britain, Mexico and The United States. Labour captured in the Organization for Economic Co-operation and Development has fallen by 4% from the early 1990s to the 2000s. A decline of that nature was not expected. Economists saw the income flowing from labour and capital as fixed. This has helped top wage earners as their income has increased even though the labour share has decreased. Workers in America blame the cheap labour for the slump in income. They have been proven correct according to research by Michael Elsby of the University of Edinburgh, Bart Hobjin of the Federal Reserve Bank of San Francisco and Aysegul Sahin of the Ferderal Reserve Bank of New York. They compared how much different industries in America are exposed to competition from imports and the decline in labour share in every industry. An increase in imports is correlated to a decrease in labour’s take. 3.3 percentage points of the 3.9 percentage point fall in the labour share in America throughout the past 25 years can be blamed on Foxconn. Trade cannot be the sole reason for the drop in labour share. Workers in developing countries, which ranges from China to Mexico, have not been able...
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...Global Division of Labour Embossed on the back of every Macbook, Iphone and Ipad reads: “Designed by Apple in California. Assembled in China.” “Why has Apple outsourced virtually all of its manufacturing overseas?” wonders President Obama (Rawson,2012). Why can’t more US-based consumer electronics and computer companies do their manufacturing work domestically, helping to create American jobs and boost the struggling economy? In the States the infrastructure and labour force does not exist at the levels necessary to support Apple’s operations, but is the answer really that simple? In this essay we will concentrate on global division of labour and determine what it is by examining theories of uneven devolopment of labour. We will discuss the advantages and disadvantages it brings to society. Concrete examples will be given to review its complex and apparently contradictory social implications. Division of labour is cooperative labour divided into an enormous number of different specialized occupations (Giddens,1993:493). Looking at theories of uneven development will give us a better understanding of global division of labour. Two theories stand for uneven development. The first being the world system theory developed by Immanuel Wallerstein. Wallerstein argues that world order was created by capitalism and not nation states. This theory refers to inter-regional and transnational division of labour. It divides the world into core countries, semi-periphery countries and the...
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...Battle for the textile and apparel industry in Southeast Asia • The reasons for China’s decreasing presence in the industry • Initiatives by the governments in Southeast Asia to boost the textile trade • Vietnam and Bangladesh’s quest to conquer apparel industry and surpass India Textile manufacturing is characterised as a high labour intensive industry and the enterprise has been steering the economic growth in Southeast Asia. The industry is closely linked to the agriculture sector and the raw materials such as cotton and jute, which are easily available, this along with high crop subsidies have supported the growth of textile manufacturing in the region. China has been dominating the industry for more than three decades as far as production...
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...Why did the Industrial Revolution take place in eighteenth century Britain and not elsewhere in Europe or Asia? Answers to this question have ranged from religion and culture to politics and constitutions. In a just published book, The British Industrial Revolution in Global Perspective, I argue that the explanation of the Industrial Revolution was fundamentally economic. The Industrial Revolution was Britain’s creative response to the challenges and opportunities created by the global economy that emerged after 1500. This was a two step process. In the late sixteenth and early seventeenth centuries a European-wide market emerged. England took a commanding position in this new order as her wool textile industry out competed the established producers in Italy and the Low Countries. England extended her lead in the late seventeenth and eighteenth centuries by creating an intercontinental trading network including the Americas and India. Intercontinental trade expansion depended on the acquisition of colonies, mercantilist trade promotion, and naval power. The upshot of Britain’s success in the global economy was the expansion of rural manufacturing industries and rapid urbanisation. East Anglia was the centre of the woollen cloth industry, and its products were exported through London where a quarter of the jobs depended on the port. As a result, the population of London exploded from 50,000 in 1500 to 200,000 in 1600 and half a million in 1700. In the eighteenth century, the expansion...
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...CHINA’S EXPORTS: AN UNSTOPPABLE COMPETITOR Pavel Aleksandrov Student Number: 000873249 Course name: MSc Engineering Management Questions: 1. In what types of good is China a world leader? 2. What are the characteristics of the types of goods in which China succeeds? 3. What explains China’s pattern of exports 4. What role does foreign investment and foreign purchasing play? 5. So who makes the money on China’s export? 6. Identify the goods in which China is uncompetitive in world markets? 7. Does China succeed in all industries? Why of why not? 8. Are Chinese provinces involved in trade the same extent? 9. Can China succeed in all industries? Q1 Nowadays China is one of the world's top exporting counties and is attracting record amounts of investment from overseas. In fact, it is investing billions of dollars abroad. The collapse in international export markets that accompanied the global financial crisis of 2009 initially hit China hard, but its economy was among the first in the world to rebound, quickly returning to growth. The following export product groups represent the highest dollar value in Chinese global shipments during 2012. Also shown is the percentage share each export category represents in terms of China’s overall exports. 1. Electronic equipment: (25.4% of total exports) 2. Machinery: (17.3%) 3. Knit or crochet clothing and accessories: (4.4%) 4. Furniture, lighting, signs and prefabricated buildings: (3.9%) 5. Optical...
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...One Nation, Different Values in China One nation, different values in China- China with its vast population and resources is one of the fastest emerging powerhouses which benefited the most from globalization along with India. So instead of going with the approach of spreading universal values and norms, many companies went in with different values in China. For Google, to enter the Chinese market certain amount of data had to be censored. So Google came up with Google.cn for its Chinese users. Google.cn censored some data on the request of the Chinese Government. But in 2006, search engine companies Yahoo! and Google found themselves in the public spotlight for censoring data that their Chinese users could see. Yahoo! also handed over information to authorities which led to imprisonment of its users. Like in the case of an online writer who was jailed for 8 years for his article on corruption. Political topics such as police brutality, Tibetan independence movement, Taiwan independence were censored. This censoring of data was similar to the case of Star TV’s dropping of BBC from its Chinese networks. Retailers focus is on social and environmental standards for imports to Europe and North America. That is they are more concerned with providing adequate working conditions, proper wages etc. In China, consumers are more concerned with safety and quality issues than with labor or the environment. As labour was easily available and at a cheap rate, it was never a concern. Nike...
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...cotton have floods that hit the world´s major producers North Eastern China and Pakistan. Early in 2010 these floods disasters “have destroyed million acres, affecting an estimated 25per cent of the cotton crop and have pushed the price of cotton to rocket up in recent weeks by more than 700 per cent” (Poulter S., September 14, 2010). What is more, as the different taxes rise and appear the price of cotton rise as well. Other thing which influencing the price of the cotton is increasing price of import. With regular increase of the price of fuel also the price of the transport will increase and it leads to increase of the price of the imported cotton. The diagram below shows that with the decrease in the supply and no change in demand price of the cotton will increase. 3. Other things that can influence price rising are maximum growth in the price of cotton, worldwide´s higher labor costs, transport costs, producing cost and rise in VAT. In the article “Fashion chains far from cheerful about future of cheap chic” from September 2010 on the website the Quardian is stated that the increase in the cotton price has its roots in the financial crisis of two years ago, when farmers stopped planting low-value cotton and switched to higher-value crops such as corn and soya. When retail sales picked up, demand for cotton also rose and prices shot up – just at a time when major cotton-producing regions such as China and Pakistan were suffering devastating floods, and India, the second...
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...terms of the production and consumption of goods and services and the supply of money. Economy is usually measured on a national scale and would incorporate the trade and services within a country; however this can also occur on an international scale which is known as globalisation. Transnational co-operations (TNCs) and Newly Industrialized Country (NICs) play a fundamental role in the interaction of economies worldwide (global economy). A TNC is a very large company that has offices and factories in many different countries, for example Nike. On the other hand, a NIC is a newly industrialized country such as Singapore, South Korea and Hong Kong (discovered in the 1970s/80s) and more recent NICs (discovered in the late 2000s) include China, India, Malaysia and Thailand. NICs are usually LEDCs that have undergone recent, rapid industrialisation and experience rising incomes, high growth rates and international involvement. Governments of these NICs kept close control over industrial development, and encouraged industries to export manufactured products to the more developed and richer countries abroad. The percentage of people working in the primary sector has declined as people move from jobs in rural areas to urban areas so that they can work in factories as the industrial base continues to develop. A ‘TNC’ is a company that operates in at least two countries. They often have management headquarters in their home country and operate in host countries alongside; examples...
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...Do rapidly rising wages and incomes in China represent an opportunity or threat for western businesses wanting to succeed in china? With a growth rate of 7.7% China is a rapidly growing country that has not only the second largest economy in the world, after the united states of America, but a vastly developing country that has a major influence on the rest of the world, especially more developed countries such as the US and the UK. It has a population of 1.4 billion people, soon to be 1 billion in urbanised areas that provide an abundance of consumers for new markets and therefore making it a major player in multinational cooperation’s targets for growth and profit. In the past Chinas geography and low cost factor have meant that many Western businesses have not only expanded into China and its markets but set up manufacturing bases in many of the coastal provinces and near big cities such as Shanghai. In 2009, 153 of the largest 200 exporters in China were firms with a foreign stake. The advantages of low cost manufacturing that is vital to many western businesses to succeed however may be coming to an end. Wage levels in China have increased continually over the last two decades as the economy developed and also from a variety of factors including to an aging population, social pressure and consequently the pressure on multinational corporations who operate within china. These wage increases and therefore rising incomes both offer the opportunity and threat for western businesses...
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...NAME: TUTOR: 1. Cheap Labour China has a large unskilled workforce willing to work for low wages. In the north many farmers struggle to make an income, therefore, they are willing to move south and work in manufacturing for low wages. Therefore, despite high growth, wages have remained low. Cheap labour has also helped avoid wage inflation. 2. Government Policy The Chinese government have been keen to promote economic growth (they have been concerned about unemployment from privatised industries and agriculture). Therefore, they have kept the Yuan undervalued. This makes Chinese exports more competitive and has helped the exporting sector. The government have also kept interest rates relatively low. Low interest rates have also encouraged some irresponsible lending. 3. Raw Materials. China has good reserves of raw materials such as coal. However, for many raw materials they are net importers. This is true, particularly, for metals, oil and precious commodities.The demand from China is one of the main reasons behind the boom in commodity prices. Therefore, we could say China has experienced growth, despite having to import so many raw materials. 4. Investment from Overseas. This increases productive capacity and helps improve technological development. However, as a % of GDP investment from overseas is relatively low. 5. Education There is a growing, educated, middle class, which has enable the economy to diversify out of manufacturing. Education will be...
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...In 2008, during the financial and economic crisis which swamped the world economy in 2008 had impacts on foreign direct investment (FDI) that had become the major driver of the globalization process. The Chinese stimulus program to get the country through the global crisis was much criticized by western experts, because it was thought to extend the Chinese development model which is strongly based on exports and investments in infrastructure and favors state-owned enterprises. Yet, during the global financial and economic crisis China succeeded to remain a much favored location for inward FDI compared to other destinations of FDI and already registered an early rebound of the incoming flows at the end of 2009. Also despite the crisis China’s outbound FDI continued to expand, not only to get hold of scarce resources in mineral rich countries, but even more so for market seeking reasons in developed countries. Factors Influencing FDI into China China has many precise advantages...
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...communication and transportation Globalisation hasn’t been something that has only affected the countries they start in E.g. on a local scale. In the UK 30 years ago our economy was driven by the secondary industry: factories etc. However due to globalisation, companies have now started to move elsewhere e.g. China, India for their factories as they can get cheaper labour. This has meant that the UK’s work force have gone from Secondary, to move Tertiary (Service based Industry). This has been beneficial for the UK as there is more money in the Tertiary sector than the Secondary, and it opens the UK to a much more educated workforce as the jobs are harder and require more training/knowledge. However not everywhere are happy about the idea of factories leaving the UK e.g. he Bosch factory in Wales. Before the factory opened this area of Wales was quite undeveloped, with very little industry bringing job shortages and run down areas. The Bosch factory brought in lots of jobs which helped develop the area; it also brought infrastructure such as roads and ports etc. This caused a multiplier effect and benefited Wales dramatically. Recently however due to Globalisation and the pull of cheap labour costs, Bosch have closed the Factory in Wales to move to a cheaper country. On a local scale Globalisation also benefits women in LEDC’s enormously. The status of women in LEDC’s is generally very poor, whether they are under religious prosecution or generally not expected to elevate over a housewife...
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... Revolution Din Not Originate in China”, Justin Yifu Lin examines several reasons for why China, with its greater population and technological advancements in premodern times was not able to beat Europe into the industrial age. The author starts off his analysis by criticizing the hypothesis ‘The High-‐Level Equilibrium Trap’, first proposed by Mark Elvin, while continuously lifting forward his own ideas and theories regarding the matter. I will start off by explaining the main parts of the High-‐level Equilibrium trap, address how Dr. Lin disagrees from the hypothesis and conclude with my viewpoints on Dr. Lin’s statements. The ‘High-‐Level Equilibrium Trap’ originates in the old supply and demand analysis where an economy is trying to stabilize around a certain equilibrium. In this case, Mark Elvin argues that labour, due to the rising man-‐to-‐land ratio was so cheap relative to resources and capital, ...
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...million people shop at Walmart’s every week, taking advantage of their suspiciously low prices. In 2003, walmart had $256 billion in sales which at the time was eight times more than tech giant Microsoft. They create millions of jobs, and provide an easy, cheap shopping location with everything under one roof. Now, how can they do this? With Walmart's 2.3 million employees in 2017 they have kept prices low, but also, kept other things low. They have kept the wages their employees receive low, and they have kept the benefits they receive low. They import billions of dollars worth of Chinese products every year to keep the prices down, thus promoting poor...
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...ON CHINA MARKET FOR TOYS: We, all know that Chinese market is very huge and complex. when it comes to toys market, the world renowned toy makers like Mattel and Hasbro have started their market share in china. Europeans and North Americans have a keen interest to enter into china market but in between they have to face some barriers. REASONS TO ENTER INTO CHINA MARKET: Good skilled labour. Low labour cost. High population. Less barriers to enter into market. BARRIERS FOR ENTERING INTO CHINA: Government policy: china has one of the largest and advanced economic policies. investors found that China had attain a level of sincerity so as to unparalleled in the middle of huge and packed out nations", with antagonism from foreign goods in more or less every subdivision of the financial system. overseas investment help to very much boost in quality, information and principles, especially industries. China's skill wires the declaration that globalisation greatly increase capital to countries. Main category of policies: Allowed limited banned Opportunities: Huge population. good economy growth stable investments. skilled labour. china has a good global market for further growth of company When About to choose a entry :Before entering into the market company should know the market scope,economy,further prospects. And the investments. By knowing this company will have a scope for further development. Mattel entry type in china: Mattel...
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