...Systems. Socialism Socialist economic systems (all of which feature common ownership of the means of production) can be subdivided by their coordinating mechanism (planning and markets) into planned socialist and market socialist systems. Additionally, socialism can be divided based on the ownership of the means of production into those that are based on public ownership, worker or consumer cooperatives and common ownership (i.e., non-ownership). Communism is a hypothetical stage of Socialist development articulated by Marx as "second stage Socialism" in Critique of the Gotha Program, whereby economic output is distributed based on need and not simply on the basis of labor contribution. The primary concern for socialist planned economies is to coordinate production to directly perceived satisfy human needs/economic demand (as opposed to generate profit and satisfy needs as a byproduct of pursuing profit), to advance the productive forces of the economy while being immune to the perceived systemic inefficiencies (cyclical processes) and crisis of overproduction so that production would be subject to the needs of society as opposed to being ordered around "capital accumulation".[7][8] Capitalism Capitalism generally features the private ownership of the means of production (capital), and a market economy for coordination. Corporate capitalism refers to a capitalist marketplace characterized by the dominance of hierarchical, bureaucratic corporations. Mercantilism was the dominant...
Words: 379 - Pages: 2
...Socialism Vs. Capitalism & Everything In-Between. We have all grown up seeing that we live in a world that divides our planet into territories. These territories are bordered by imaginary lines that divide us from them. The borders in which we live play a major role in developing each of our identities, our customs or traditions, the way we conduct ourselves in business and personal endeavors. Some of us have grown up with an expectation of freedom to choose, while others depend on their government to act in their best interest. Depending on what country you call home, you either participant in a free market economy, a controlled economy, or a mixture of both. In this report we are going to look at what creates each type of economy and where we can find examples of each within the world. First we are going to analysis the characteristic of a Free Market Economy. In a free market, the government’s role is to “make sure that the market is stable enough to, properly, conduct business” (Freidman). In purity, the system hopes to “eliminate subsidies for industries, the pre determination of prices, and the amount of regulation controlling certain industry sectors”(Freidman). The implementation of a free market introduced individual property rights, which allows citizens to voluntarily exchange property/resources at a price arranged solely by the mutual consent of the buyer and seller. The seller is free to choose if the price being offered is worth their property; without threat...
Words: 2335 - Pages: 10
...Disinvestments Role of headquarter Competitive strategy Product strategy Advertising measures Price strategy Make of buy Innovation strategy Building up market entry barriers Usage of economies of scale Building up alliances Competitive advantages 1. Company 2. Competitor 3. Customer Unique Selling Proposition The unique feature of a product, which enables to have a competitive advantage over other providers. The marketing concept of the unique selling proposition facilitates the successful promotion of products. Highlighting of an outstanding product feature supports the company in positioning their products and helps to convince consumers of its benefits. Different ways of value of the headquarter 1. Stand-alone Influence Separate influence on the strategies and the performance of the particular business fields 2. Linkage Influence Creating synergies by taking advantages of existing relations between business fields 3. Central Functions and Services Avoidance of redundancies by providing cost-efficient centralised services 4. Corporate Development Design of the business portfolio through purchase, sale and restructuring of business fields Business design The totality of how a company selects its costumers, defines and differentiates its offerings, defines the tasks it will perform itself and those it will outsource, configures its resources, goes to market, creates utility for customers, and captures profit. It is the entire system for delivering utility to customers and earning a profit from that activity...
Words: 2100 - Pages: 9
...documentary Commanding the Heights: the Battle of Ideas made by PBS, then conducts the analysis on the two competing economic ideas of Keyes vs. Hayek, and finally presents a detailed illustration of their impacts on the America’s economic policies since 1980. Introduction The PBS-made documentary ‘Commanding the Heights’ is to promote better understanding of globalization, economic development and world trade, featured with specific examples of different countries and interviews with related parties. Episode One "The Battle of Ideas," gives an overview of the battle between two major competing ideas about the world economy over the course of last century. On the one hand, the English economist Keynes believes in the ‘planned economy’ and advocates the government intervention to mitigate the risk during economic recession or depression; On the other hand, the Australian economist Hayek favors the free market mechanism and believes in minimum government intervention as market will eventually take care of itself and the prices system is at the heart of what makes a functioning economy work. The episode tracks the root of these ideas and explains how the world moved toward the government controlled economy during the 20th century in a chronological order summarized as below. The Russian Revolution in 1917 marked the beginning of communism economy, in which government is very important to allocate resources and goods. During the great depression of 1930, the Keynes’ theory began...
Words: 1913 - Pages: 8
...including staunch capitalist bastions like the U.S. and U.K. - have government programs that borrow from socialist principles. "Socialism" is sometimes used interchangeably with "communism" but the two philosophies have some stark differences. Most notably, while communism is a political system, socialism is primarily an economic system that can exist in various forms under a wide range of political systems. Comparison chart | |Communism |Socialism | |Philosophy |From each according to his ability, to each according to |From each according to his ability, to each according to| | |his needs. Free-access to the articles of consumption is |his contribution. Emphasis on profit being distributed | | |made possible by advances in technology that allow for |among the society or workforce to complement individual | | |super-abundance. |wages/salaries. | |Economic System |The means of production are held in common, negating the |The means of production are owned by public enterprises | | |concept of ownership in capital goods. Production is |or cooperatives, and individuals are compensated based | | |organized to provide for human needs directly without...
Words: 3092 - Pages: 13
...Tesco Company | Name;ID; | Institutions | Contents 1.0 Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 2.0 The Organizational purpose of business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 2.1 Organizational objectives Vs Stakeholders objectives . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 3.0 The nature of national environment in which businesses operates . . . . . . . . . . . . . . . . . . . . . . . . . . 6 3.1 Distinctions between Planned, Free market and mixed economic models with examples . . . . . . 6 3.2 Use of Monetary and fiscal policy in management of economy . . . . . . . . . . . . . . . . . . . . . . . . . 7 4.0 The behavior of organizations in their market environment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 4.1 Market structure Tesco operates and its effects on pricing and output decisions . . . . . . . . . . . . . 9 4.2 Use of PESTEL analysis to judge how the market forces affect the behavior of Tesco 11 5.0 The significant of global factors in shaping national business activities . . . . . . . . . . . . . . . . . . . . 12 5.1 Significance of international trade to Business organization located in UK . . . . . . . . . . . . . . . 12 5.2 Benefits and drawbacks for UK business Of EU policies . . . . . . . . . . . . . . . . . . . . . . . ...
Words: 4102 - Pages: 17
...environmental standard, tax codes, terrorism and others. 3. Transfer risk in which government interferes with a firms ability to shift funds into and out of the country. Economic Environment and International Business Economic System is the way a society decides to use and distribute its resources. 1. Who can own property in this system? 2. Who controls and distributes the resources in this system? 2 10/27/2015 Types of Economic Systems 1. Market Economy In pure market economy, all productive activities are privately owned , as opposed to being owned by the state. Price and production are determined by the interaction of demand and supply. 2. Command Economy or Planned Economy In pure command economy, all productive activities are state owned , as opposed to being owned by the individual. In pure command economy, the government plans the goods and services that a country produces, the quantity, and prices at which they are sold. 3. Mixed Economy Capitalism/Free Enterprise/Free Market Private Ownership Profit Motive Competition 3 10/27/2015 Legal Environment and International Business Legal Environment A legal system is the mechanism for creating, interpreting and enforcing the law in a specific jurisdiction. Country’s legal system affects business by - regulating how companies conduct business transactions, -specifying the rights and obligations of...
Words: 660 - Pages: 3
...theories of Friedrich Hayek are glorified and explained. Hayek is the best-known advocate of Austrian Economics. This writing focuses on the idea that the market is a spontaneous order. The belief that the free market was not designed by anyone, but evolves slowly as a result of human actions. It is stressed that the market is imperfect, and reasons for this imperfection are given. The question Hayek asked was “What causes the market to fail to fail to coordinate people’s plans, so that at times large numbers of people are unemployed?” One explanation given was the increase in money supply by the central bank. Increases by the central bank have the capability to drive down interest rates, inevitably making credit artificially cheap. Contributing to this issue, is business men making capital investments, unknowingly receiving distorted price signals from the credit market. Capital investments are inconsistent. Long-term investments are more sensitive to interest rates. Hayek came to the conclusion that artificially low interest rates causes investments to be high, which in turn causes too much investment in long-term projects. Instances like this turn the boom into a bust. Hayek viewed busts as a positive, because it is a natural readjustment. Hayek explained the way to avoid busts, is to avoid the booms that cause them. Keynes vs. Hayek: The Rise of the Chicago School of Economics. (2015). Retrieved from http://www.econedlink.org/lessons/index.php?lid=593&type=student In this...
Words: 1044 - Pages: 5
...Intro to Economic Concepts Definition of Scarcity A situation in which human wants are greater than the capacity of available resources to provide those wants. 3 Parts: 1. People want it 2. There is a limited amount of it 3. It has more than one productive use Scarcity Scarcity vs. Abundance – people see many signs of abundance (e.g. cell phones, iPods) and also see resources wasted daily (e.g. water and food). However, as long as resources are limited and people’s wants are unlimited, scarcity (in the economic sense) will exist. Scarcity In economic reasoning, scarcity is a relative concept, not an absolute one. Scarcity does not mean “not plentiful.” In economics, something is scarce when it has more than one valuable use. = & Opportunity Cost Opportunity cost is what you give up to obtain something else, the second-best alternative. However, what you must give up is not money – it is whatever good or service you would have spent the money on as your next favorite choice. Goods v. Services Good – something that is tangible; it can be seen and felt. It requires scarce resources to produce and it satisfies human wants Goods v. Services Service – something that is intangible; yet it too requires scarce resources to produce and satisfies human wants Is it a good or service? Productive Resources L – land (and stuff from land) L – labor (physical and mental) C – capital (human-made...
Words: 1239 - Pages: 5
...Hereafter it could be settled that government intervention could have played a huge role in avoiding the crisis. Many countries around the world have to decide whether to regulate or not to regulate their accounting standards. Supporters of regulation usually state that the free market notion states that accounting information is like an economic good so it is best to leave the markets to decide what and how much information is needed. This will help achieve efficient market system, however this kind of a system exists only in theory and not in reality, and so then what is the point of a free market system when it cannot be efficient? (Y. Hong, 2007) The rewards of free market system are realized only when it is executed in isolation. But in reality, markets cannot be left completely on its own and some regulation or government intervention is required. Government intervention even at its minimum will not be able to achieve efficient markets and thus it is better to have a well regulated system. Free market system has led to market failures that have had major adverse effects globally in the past. On the contrary, planned economies have also hampered innovation and productivity like China and thus some market system should be there. Y. Hong (2007) in the article mentions the Australian accounting regulations and describes them as very stringent resulting in negative consequences. Australian reporting...
Words: 1762 - Pages: 8
...Chapter 2 1. Political Economy: The political, economic and legal system of a country 2. Political system: he system of government in a nation 3. Political systems can be assessed according to two dimensions. The first is the degree to which they emphasize collectivism as opposed to individualism. The second is the degree to which they are democratic or totalitarian. (collectivismtotalitarian; individualismdemocratic) 4. Collectivism: Collectivism refers to a political system that stresses the primacy of collective goals over individual goals. (socialism, communism, social democracy) 1. Socialist: Someone who believes in public ownership of the means of production for the common good of society. 2. Communist: The communists believed that socialism could be achieved only through violent revolution and totalitarian dictatorship. (eg: china, cuba, north korea) 3. Social democrats: committed themselves to achieving socialism by democratic means, turning their backs on violent revolution and dictatorship. 5. Individualism: individualism refers to a philosophy that an individual should have freedom in his or her economic and political pursuits.(freedom of expressions, economic self-interest) 6. Democracy vs Totalitarianism (communist, theocratic, tribal, right-wing) 1. Democracy: Political system in which government is by the people, exercised either directly or through elected representatives. 2. Totalitarianism: Form of government in which one person...
Words: 644 - Pages: 3
...practitioner". Partnership: A partnership is an association of two or more people formed for the purpose of carrying on a business. Partnerships are governed by the Partnership Act (1890). Incorporated Company: Incorporating business actions into a company confers life on the business as a "separate legal person", Profits and losses are the company's and it has its own debts and obligations. Types of the Business Organization: Private Company: A company whose ownership is private. Private companies may issue stock and have shareholders. Public Company: Public Company may be defined as, A company that has issued securities through an initial public offering (IPO) and is traded on at least one stock exchange or in the over the counter market. Government Company: Government Company may be defined by, it is a legal entity created by a government to start money-making activities on behalf of a proprietor government. Voluntary Organization: Voluntary organizations may be defined as, organizations are non-profit ambitious, self-directed and non-statutory, that are run by persons who accomplish not obtain salaried. Its main plan is to bring social advantage. Cooperative Organization: A cooperative organization is owned by and operated for the advantage of those persons using its services. Cooperative organization also known as user-owners. Charitable Organizations: A charitable organization is a type of non-profit organization (NPO). Sector’s of Business...
Words: 6046 - Pages: 25
...Bus 109 qn 1 5pts Draw a demand and supply curve . Label properly with axis. Explain the curve and how it works . How to shift both curves. How to shift demand curve. 10 pts increase demand by doing what ?: Make people want it more. Marketing or advertising . Red line goes up. Not enough supply. New equilibrium point (higher on the price axis) *shift to the right. * price increase and quantity increase. 10 pts draw and explain increase in technology and how it effects the graph: Supply increases so it is cheaper to produce. The supply curve shifts to the right because more quantity produced. Price also decreases. Qn2 Personal Insurance. Liability automobile insurance bodily injury liability : held legally liable for damage caused by car or driving eg disability,death, breadwinner is handicapped and can no longer earn for the family. Property damage liability insurance damage to the other persons car or other property eg house that you drove into. COGS in a truck that's hit. Uninsured motorist. The person has no auto insurance. Bodily damages , breadwinner, medical bills. (first party insurance covers your own family and own party) Medical payments only medical bills. Group insurance also included. Possibly not first party liability but if it was your fault. Personal injury protection (no fault states only. Only two no fault states) take care of major injuries. Time off work(breadwinner situation) , medical bills. Physical damage protection ...
Words: 2229 - Pages: 9
...OWNING -VS- RENTING Principles of Macroeconomics Professor John Weber October 17, 2013 Low mortgage rates and rising apartment rentals all over the country has led some people to dive into homeownership more quickly than originally planned. There are many that are still waiting for the housing market to recover, even with incentives to buy. All rely on the personal financial situation in making this decision. Renting vs. Owning both presents a number of pros and cons: Renting: Pros Cons Flexibilty and free Can’t build equity Terms of lease Restrictions No maintenance and upkeep Approval by owner to paint or remodel Ownership: Pros Cons Build Equity Pay for Maintenance Tax Breaks Illiquid Asset Stability of Mortgage Property Taxes Investment Lose of Value Location Use of your savings for down payment Remodeling as you please Owners insurance is Mandatory However purchasing property can be for many reasons, such as, an investment for flipping, to fix up and resale or to occupy. Maintenance of up keep, roof, windows, snow removal, and credit score is all things to consider for purchasing a home. When purchasing there are many different options row home, single, development all are investments. There are many financial parts that play into the option of purchasing and renting. When buying you must be very aware of purchase costs which are the down payment and closing costs. Yearly...
Words: 482 - Pages: 2
...Emerging Markets Most of the Developing countries are known as the emerging markets. They are driving the global economy. Investing in emerging markets is a wise decision as the growth can be witnessed and also have better return on investment for future. It is anticipated that Emerging economies will mature two to three times more rapidly than developed nation like the US, as predicted by International Monetary Fund estimates. Corporate profits incline to grow faster when economic growth is higher. Likewise, US companies have done well in the last 12 months is because of their growth in non-US markets. Emerging markets also prove beneficial to investors as they create diversification as they act differently than developed markets. Emerging Markets Index of Morgan Stanley's consists of Argentina, Brazil, Chile, China, Colombia, Czech Republic, Egypt, Hungary, India, Indonesia, Israel, Jordan, Poland, Russia, South Africa, Taiwan, Thailand, and Turkey (Forbes). Russia is one of the booming emerging markets in the East. However, Russia is not always an investor favorite as it is a booming market in global oil and gas demand. Russia has tons of both. It is the world's prominent natural gas producer and exporter and has the 8th largest oil reserves in the world. Russia is considered as a bargain for equity, but that is mostly due to country risk. (Forbes) During the recession in 2008, world markets in developed countries crashed but the emerging markets saved the global economy, mainly...
Words: 2614 - Pages: 11
