...industries of steel, cement, and plastics. The only way this scenario takes place is if those main industries stop expanding. If that happen the result would be the crowding out effect which would result in the rise of interest rates. The crowding out effect looks like thisNow if that does happen China needs to be planning ahead with the Ricardian Equivalence Theorem. This is the proposition that an increase in the government budget deficit has no effect on aggregate demand. Joerg Wuttke said “existing overcapacity could force producers to slash prices to export surplus goods, possibly fueling demands abroad for foreign leaders to protect jobs at a time of high unemployment” (Article). Getting people employed will help a lot since that means more people will be buying stuff since they have money from working in their job. 2. Which argument against free trade, that is, for protectionism, does Joerg Wuttke of the European Union Chamber of Commerce in China expect to see from countries that...
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...Europe conduct tight monetary policy to raise interest rate. In contrast, the Fed (The Federal Reserve Bank) does not conduct tight monetary policy to raise interest rate. The author of this article states that the U.S. acts like an outlier. Some officials like the Hawks, people who pursue an aggressive policy, would like to see the Fed to tighten monetary policy. On the other hand, the Fed has conventional Keynesian perspective over the monetary policy. They are optimistic about inflation but aware of unemployment. So, there is a conflicting argument between the hawks and the Fed leaders. Ben Bernanke, chairman of the Fed, considers inflation’s principal determinants to be gap between aggregate demand and aggregate supply. In contrary, the hawks put less emphasis on the gap between aggregate demand and supply to regulate the inflation rate and more weight on the position of monetary policy. Although, there are arguments between hawks and Keynesian, opinions of Ben Bernanke determine the policy since hawks are not in charge at the Fed. Even though Fed can tighten monetary policy by shrinking its balance sheet, uncertain effects of new affair will not encourage Fed to change the monetary policy. Theory Review and Analysis In contrast to the United...
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...The importance of credibility for the conduct of monetary policy and inflation control Theoretical model and empirical analysis for Brazil under inflation targeting Gabriel Caldas Montes1* Alexandre Curi ** Abstract This paper raises the following hypotheses: to the extent that the monetary authority successively reaches the inflation target and credibility increases, expectations will have more influence on inflation and, thus, the efforts of the monetary authority to reach the inflation target will decrease. Hence, the goal of this work is twofold: 1) a theoretical model is developed to show that when the monetary authority is committed to the goal of price stability, the gain of credibility not only acts by producing a better result in terms of inflation, but also it reduces the volatility of the basic interest rate, and; 2) based on the Brazilian economy, the article provides empirical evidence that the gain of credibility is crucial to reduce the volatility of the basic interest as well as the inflation rate. The findings suggest that credibility plays a key role for the conduct of monetary policy and inflation control. Keywords: inflation targeting, credibility, interest rate, inflation JEL classification: E43, E52, E58 * Fluminense Federal University, Department of Economics, National Council for Scientific and Technological Development (CNPq), Brazil. Rua Tiradentes, 17, Ingá, Niterói, Rio de Janeiro, CEP: 24210-510. gabrielmontesuff@yahoo.com.br ** Fluminense...
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...Topic 4 – Fiscal Policy Refers to the governments choices regarding the overall level of government purchases or taxes * Government spending – on health sector, education, infrastructure, defence. * Taxation policy – income tax, sales tax (VAT), corporate tax, capital gains tax. Fiscal policy and aggregate demand * Government spending – increase in G spending → AD shifting right * e.g. Gov places £10 billion order for new school buildings → building contractor has increased demand for output → hires more staff and increases production. * Taxation – * Income tax cut → consumption increases → AD shifting right * Corporate tax cut → investment increases → AD shifting right * If tax cuts are seen as temp then AD shift may be smaller Multiplier Effect The additional shifts in aggregate demand that result when expansionary fiscal policy increases income and thereby increases consumer spending. * Example continued… * Positive impact - The Gov buys £10 billion of buildings from Bob and Co, → demand from gov raises employment and profits at Bob and Co → as workers see higher earnings and firm owners see higher profits → increase own spending on consumer goods and so on… This is the multiplier effect. * Negative impact could be that spending on foreign goods may increase → neg impact on AD as imports increase. * Size of multiplier depends on marginal propensity to consume and import. * SHOW IMPACT OF MULTIPLIER...
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...page 57 Printer: Opaque this 3 Time Series Concepts 3.1 Introduction This chapter provides background material on time series concepts that are used throughout the book. These concepts are presented in an informal way, and extensive examples using S-PLUS are used to build intuition. Section 3.2 discusses time series concepts for stationary and ergodic univariate time series. Topics include testing for white noise, linear and autoregressive moving average (ARMA) process, estimation and forecasting from ARMA models, and long-run variance estimation. Section 3.3 introduces univariate nonstationary time series and defines the important concepts of I(0) and I(1) time series. Section 3.4 explains univariate long memory time series. Section 3.5 covers concepts for stationary and ergodic multivariate time series, introduces the class of vector autoregression models, and discusses long-run variance estimation. Rigorous treatments of the time series concepts presented in this chapter can be found in Fuller (1996) and Hamilton (1994). Applications of these concepts to financial time series are provided by Campbell, Lo and MacKinlay (1997), Mills (1999), Gourieroux and Jasiak (2001), Tsay (2001), Alexander (2001) and Chan (2002). 58 3. Time Series Concepts 3.2 Univariate Time Series 3.2.1 Stationary and Ergodic Time Series Let {yt } = {. . . yt−1 , yt , yt+1 , . . .} denote a sequence of random variables indexed by some time subscript t. Call such a sequence...
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...Review of Development Economics, 9(2), 166–176, 2005 Endogenous Growth Models and Stock Market Development: Evidence from Four Countries Guglielmo Maria Caporale, Peter Howells, and Alaa M. Soliman* Abstract This paper re-examines the relationship between stock market development and economic growth. It provides a theoretical basis for establishing the channel through which stock markets affect economic growth in the long run. It examines the hypothesis of endogenous growth models that financial development causes higher growth through its influence on the level of investment and its productivity. The empirical part of this study exploits techniques recently developed to test for causality in VARs. The evidence obtained from a sample of four countries suggests that investment productivity is the channel through which stock market development enhances the growth rate in the long run. 1. Introduction Several theoretical and empirical papers such as Levine (1991), Levine and Zervos (1995), Demirguc-Kunt (1994), Demirguc-Kunt and Levine (1995), Rousseau and Wachtel (2000) and Beck and Levine (2003), have suggested that stock market development affects economic growth in developing countries. The common problem with these studies, however, is that there is no discussion of the channels through which stock markets can stimulate economic growth. In traditional growth theory, the growth rate is a positive function of exogenous technical progress. However, financial development...
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...including electricity, plays a significant role in economic development, not only because it enhances the productivity of capital , labour and other factors of production, but also that increased consumption, particularly commercial energy like electricity, signifies high economic status of a country(Aklas & Yilmaz, 2008). The relationship that exists between electricity consumption and economic growth has been of great interest to many researchers. The study of this relationship arises from the need to understand the complex links between these variables. Such understanding is basic to regulators and investors in deregulated electricity markets, in order to design a system that is reliable, efficient and growth-efficient. The empirical argument has been centered on whether economic growth responds to increase in electricity consumption, or whether increase in economic growth propels increase in electricity consumption. To this end, various empirical studies have explored the causal and long-run relationship that exists between electricity consumption and economic growth. So far, there have been different and conflicting empirical findings as regards this relationship in different economies. The empirical outcomes of the past studies...
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...geopolitical dynamics. The criterion can be accepted on the basis of alternative theories of recognition like the implied, collective or conditional recognition. Democracy cannot be cited as the most favourable form of governance universally. Movement towards a democratic form of governance has been a process involving proportionally large sections of population demanding decision making power. By making democracy a necessary constituent, the law will forcibly aim towards restructuring the political framework existent in a country which has has been newly formed, thereby asking it to dilute the same and reform until statehood status is granted. This process can create a severe time lag, especially in a society where a democratic framework is unheard of, before it can move towards progress. The argument also assume that...
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...Of Audit Fees: Empirical Evidence From Emerging Economy Kamal Naser* Hamed Abdullhameed** & Rana Nuseibeh*** Abstract This study investigates the structure of audit fees in an emerging economy, Jordan. Data were collected from a sample of companies listed on the Amman Stock Exchange that forms 90% of the total population and fairly presents all industrial sectors within the economy. Consistent with previous research, the results of the analysis revealed that corporate size, status of the audit firm, industry type, degree of corporate complexity and risk are the main determinants of audit fees in the Jordanian environment. Unlike previous studies, however, variables such as corporate profitability, corporate accounting year-end and time lag between year-end and the audit report date appeared to be insignificant determinants of audit fees in the sampled companies. Key Words: * Audit fees, Emerging Economy, Jordan. S S cientific Journal of Administrative Development Vol.5 I.A.D. 2007 Dean College of Business Administration, Al-Ain University of Science and Technology, UAE. ** Freelance Financial Analyst, Jordan. *** Link Officer, National Health Service (NHS), UK. 84 Determinants Of Audit Fees: Empirical Evidence From Emerging Economy Introduction Although a number of studies have provided empirical evidence on the relationship between audit fees and the attributes of audited companies, most have tended to focus on developed economies (see for example:...
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...-Why Chinese Mothers are Superior- The essay “Why Chinese Mothers Are Superior” by Amy Chua was published on “The Wall Street Journal” January 8, 2011. The topic of this text is Chinese parenting methods opposed to the western way of parenting. Within the first few lines it is very clear that Amy Chua has a different view on parenting than most traditional western parents. The title itself is a claim, and it sets the tone for how the essay is going to be. From the start we get the hint that this text will try to convince us, that Chinese parenting methods are superior. Amy Chua begins something that she claims is on a lot of people’s minds. The wonders about how Chinese parents are able to raise such successful kids. She then continues to saying that she can give the answer to these wonders, because she has done it herself. Amy Chua gives us a list of things that her daughters, were never allowed to do. This list seems, to us, unusual and maybe even mad. But to her, this is a necessity in her way of parenting. To her this is logical and is what must be done to get successful kids. In her list we see that not only are her children not allowed to get any grade less than A, but also they have to be the No. 1 student in every subject, except gym and drama. This put a really huge amount of pressure on her daughters. Amy Chua is an American lawyer, writer and legal scholar. She is the Professor of Law at Yale Law School. Amy Chua has two daughters Sophia and Louisa. The fact...
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...citizens like other countries but various public programs for the benefit of poor, disabled and elder people are organised. There are basically two approaches to health care financing namely: - Market based financing and government financing. Multiple payer health care system is funded by privately owned health insurance companies and is therefore called as market oriented. It is dependent upon the paying capacity of the beneficiary and accordingly the insurance plan is purchased by the beneficiary. Various health plans cover various health care services but choice depends upon the purchasing power of the beneficiary to a greater extent. Advantages and disadvantages of this system are described as follows:- Advantages:- 1. No time lags 2. Various plans according to the need and paying capacity of the beneficiary are available. 3. All health care services are covered. 4. Risk under this system is distributed at different levels. Disadvantages:- 1. Effect of job rotation and job loss on health coverage 2. Financial barriers in choosing...
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...LAND ACQUISITION IN INDIA A REPORT SUBMITTED FOR THE COURSE “THE INDIAN ECONOMY” SUBMITTED BY: BISWAPRIYA SAHA DEEPSHIKHA GOVLI HIMANI KABRA ITISHREE DASH MRITYUNJAY BASAK PGP/17/076 PGP/17/077 PGP/17/080 PGP/17/083 PGP/17/094 Page 2 of 13 Table of Content ACKNOWLEDGEMENT ............................................................................................................................ 3 EXECUTIVE SUMMARY .......................................................................................................................... 4 INTRODUCTION ........................................................................................................................................ 5 BENEFITS OF LAND ACQUISITION ....................................................................................................... 6 NEGATIVE IMPACT ON FARMERS ........................................................................................................ 6 NEGATIVE IMPACT ON TRIBALS .......................................................................................................... 6 NEGATIVE IMPACT ON SOCIETY.......................................................................................................... 6 NEGATIVE IMPACT ON ENVIRONMENT ............................................................................................. 6 CRITICISM OF LAND ACQUISITION POLICY ...................................................................................... 7 LAND...
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...Contents 1 a) Examine the arguments in favour of a free market system of resource allocation. ..................................... 1 1 b) Explain how market failure can occur and suggest how the government in a country of your choice has sought to correct those market failures. .............................................................................................................. 4 ‘Too big to fail, too big to bail’........................................................................................................................... 5 2. A) Examine how the government of a country of your choice has adjusted its monetary and fiscal policy in response to the world’s downturn. Explain the reasoning behind these adjustments. ........................................ 7 Suggestions offered by EU ................................................................................................................................. 8 Applying fiscal and monetary policy by the Government .................................................................................. 8 Conclusion .......................................................................................................................................................... 9 2 b) Indicate the problems which are created for the government’s finance as a result of it seeking to avoid deeper recessions. What solutions might you recommend?.............................................................................. 10 What...
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...Table of Contents S. No Page No. 1. Tutorial 1………………………………………………………………………… 2 2. Tutorial 2………………………………………………………………………… 5 3. Tutorial 4………………………………………………………………………… 7 4. Tutorial 5………………………………………………………………………… 11 5. Tutorial 6………………………………………………………………………… 14 6. Tutorial 7………………………………………………………………………… 16 7. Tutorial 8………………………………………………………….…………….. 23 Tutorial 1: Question 1. In this paper, Collinson discussed based on shop-floor humor, particular its relationship on the organization. To purpose is to gender identify and working class resistance. 3 main points Collinson made in this paper: * Human as resistance * Human as conformity * Human as control Each element that author gave some exactly examples and databases in the work place and then he analyzed his opinion depend on Willis case study Question 2. There are 3 parts in structure of the paper: * Human as resistance * Human as conformity * Human as control Human as resistance * Shop-floor humor was in part a form of resistance both to the tightly controlled repetitious work tasks and to the social organization of production within a company * Some nicknames come from exaggerated and stereotyped personal characteristics. * Human was shown to operate as one medium through which collective solidarity to resist boredom, the organizational status system and managerial control emerged. Human...
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...Ducati feedback Q1. I wanted you to begin by recognising that this was a turnaround situation, with Ducati in 1996 close to bankruptcy. A new management team led by Minoli changed strategy with clear objectives of aggressive growth within a niche of the sports segment and competing as a focussed differentiator. The logic of the turnaround can be conceptualised as follows (a) Ducati reduced costs without affecting the WTP for the physical product (i.e. the quality and reliability of the product has increased despite reduced costs). Major reductions were in motorcycle material costs (from 68.2% to 59% of unit costs, exhibit 12) and can be attributed to the following factors: (1) rationalised suppliers from 200 to 130 with the effect of increasing the quality of suppliers and Ducati’s bargaining power (2)Ducati increased its outsourcing from 80% to 90% and thus tapped more the potential of the Emilian mechanical district (3) Ducati further increased its bargaining leverage by instituting dual sourcing for the major components of the motorcycle and adopted short-term contracts (4) Ducati enjoyed economies of scale by increasing output from 12000 bikes in 1996 to 39000 in 2000 (5) Ducati increased the standardisation of its products (parts) and thus increased the bikes produced per worker from 76 to 87 in 200 (14% increase) (exhibit 13). (b) Ducati increased costs to boost WTP for the product’s intangible aspects (i.e. sport character, community, design, exclusivity, Italianess...
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