Pyramid Scheme

In: Business and Management

Pyramid schemes in albania essay
1- Introduction
At the beginning of the year's 1990th, with the falling of the communism, many Albanians people went through the foreign embassy to left Albania and go abroad for a better life. They started to create a real income. In this time we have some mountebanks in the market which created the pyramid schemes and offered high interest rate. People invested in this scheme their savings. According to the data of the different official institutions, the number of the Albanian which invested in schemes is increased time after time. Deposits of these schemes take e big part of the GDP. This means that they have had an important role in our economy.
Through this paper we want to give a general overview of phenomena of pyramid schemes and collapse that they afflicted. We will analyze the rise and favorite factors that encased prosperity of these companies for a long time and the way how they operated. Another point in our paper shows the impact and bankrupt causes that brought the fail of pyramid schemes. The last point shows the role of the institution that answered for minimization of crises effect. In our paper all the results will be accompanied with dates from different years.
In the first chapter we will handle phenomena of schemes by focusing in three important cases a) we will give a short description for origin of schemes and the biggest schemes, b) in another case we are going to analyze the factor that took born of pyramid. c) We will give a simple model explaining how they operate. In the second chapter we will analyze pyramid falling being focused in the bankrupt causes and three consequences: politic, social and economic. In the third chapter we will describe the role of two institutions that managed the consequences of the cries.
2-The phenomena of pyramidal schemes
In this chapter we will discuss the phenomena of...

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