...Experts Investment Investment is time, energy, or matter spent in the hope of future benefits actualized within a specified date or time frame. Investment has different meanings in economics and finance. In economics, investment is the accumulation of newly produced physical entities, such as factories, machinery, houses, and goods inventories. The word "investment" has become muddled with overuse. Referring to a stock or a bond as an investment is still in regular use, but now people make "investments" in their education, their cars and even their flat screen TVs. In this article, we will look at the three basic types of investment as well as some of the things that are definitely not investments - no matter what the commercial says (en.wikipedia.org). In simple terms, Investment refers to purchase of financial assets. While Investment Goods are those goods, which are used for further production. Investment implies the production of new capital goods, plants and equipments. Refers investment as real investment and not financial investment (John Keynes). Investment is a conscious act of an individual or any entity that involves deployment of money (cash) in securities or assets issued by any financial institution with a view to obtain the target returns over a specified period of time. Types of investment There are three types of investment: 1. Ownership investment 2. Lending investment 3. Cash equivalent 1. Ownership Investments Ownership investments are what...
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...recognition of the critical need for infrastructure investment is exemplified by the creation of the Presidential Infrastructure Coordinating Commission (PICC) in April 2012. However, 76% (R58.5 billion) of new infrastructure developments in 2011 came from the private sector (Munshi, 2012). An analysis of the importance of investment and investment rates for economic growth and employment, the relevance of South Africa’s capacity utilisation level and its relationship to businesses’ cash stockpiles, and the government’s New Growth Plan will give an overview of South Africa’s current and future investment level, and its implications for economic prosperity. Public and private investment and increased investment rates are vital for current and future economic growth. An increase in government spending on goods and services and/or a fall in the interest rate causes the aggregate demand curve to shift to the right, which leads to an increase in Real Gross Domestic Product (GDP) (Parkin et al, 2010): Figure 1 (Parkin et al, 2010: pg 615) 615) Workers are hired by firms to enable expanded production, and the unemployment levels decrease. However, there is no guarantee as to the extent of this causal effect, as the relationship between economic growth and job creation has weakened over the past few decades, due to labour regulations and growth in high-skilled areas (Neethling, 2012): Figure 2 (Neethling, 2012) Investment in human capital and physical capital stock can lead...
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...Standard’, country’s wealth and power was dependent on export surplus. Export prices had to be kept low by low wages. Marx argued that creating supply while not creating purchasing power would lead to creation of ‘surplus value’. Economies would experience excess production, stock piling, down turn and periodic unemployment. Over time, the down turn would get worse. For labour, having a job or being unemployed made little difference. Marx believed that periodic recession and crisis of capitalism would lead to the self destruction of the system and its eventual downfall. He called on labour to revolt. ‘You have nothing to lose but your chains’ he said. His clarion call was ‘workers of the world unite’. It is an irony of history that Marx, a great philosopher, proved to be poor prophet, precisely because of his own advocacy. Had Marx not said what he did say, his prophecies would have come true. His ideas resulted in significant system reforms in Britain. Publication of Marx’s Communist Manifesto in 1948 put the British society and polity on guard. In 1850s British Parliament enacted a number of laws aimed at labour reforms. Trade Unions were recognized. Minimum wages were instituted. Limitations were prescribed on hours of work, on age of workers (banning child labour) and on employment conditions for women. The dooms day forecast of Marx did not materialize. Even when a Communist State came in to being in 1917, it was in the predominantly agricultural and backward Russia. ...
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...introduction The Tourism Industry has become one of the most lucrative industries in the country. In fact a record 982 million international tourists traveled the world in 2011, an increase of 4.69% compared to 2010 WTC. Tourism has also been a driving force of job creation across the world in the service industry such as transportation services, airlines, cruise ships and taxicabs; hospitality services, such as accommodations, including hotels and resorts; and entertainment venues, such as amusement parks, casinos, shopping malls, music venues and theatres Wikipedia. According to the World Travel & Tourism Council in 2011 Travel & Tourism directly supported 3.3% of jobs, not including the indirect contribution of jobs supported by travel & tourism creating 8.7% of total employment WTTC. The purpose of this research paper aims to the understanding of Tourism differences and similarities of the U.S. and France, but not limited to the overall outlook of tourism. As highlighted within the report you will understand TT policies, how tourism has a direct effect on the social, geographical, and economic sectors both national and international. Based on an economic perspective tourism bring an enormous amount of revenue for goods and services accounting for 30% of the world's exports of services, and 6% of overall exports of goods and services WTTC. This impact is driven by many travel organizations and travelers desire for leisure, wellness, business and social travel...
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...Joint Venture on Employment Generation: A Multi-sector Experience of Bangladesh Economy” 1. Md. Nazmul Hasan, Lecturer of Finance and Banking, Daffodil International University, 4/2, Sobhanbag, Prince Plaza, Mirpur Road, Dhanmondi, Dhaka-1207, Bangladesh. (Correspondent Authors). palashdu007@gmail.com. Cell: +88-01915.653068 2. Hussain Ahmed Enamul Huda, Lecturer, Department of Finance, University of Dhaka, Dhaka – 1000, Bangladesh. Haehuda@yahoo.com. Cell: +88-01911.745255. Abstract: Foreign Direct Investment (FDI) is very crucial for the sustainable development of developing countries in general and in specific for LDCs-like Bangladesh. For Bangladesh, inflow of foreign direct investment is the major stimulus for the sturdy and long-standing economic growth which is subject to the improvement of many socio-economic and political factors. As a promising hub for foreign direct investment, Bangladesh has already conquered popularity for its simplistic, liberal and most investments friendly climate throughout the globe. Being an open, flexible and promising destination for foreign direct investment, Bangladesh has been drawing attention of the global investors into a focal investment destination within SouthAsian region. Its investment climate is mostly featured by munificent and alluring packages of incentives to investors. In addition, there is no discrimination between the local and foreign investors in facilitating the incentives they owe from the investment destination. The...
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...industrial sectors have grown in recent years (Dicken & Oberg 110). In 2006, the GNI per capita was 201.6. Natural resources in Argentina include fertile plains of the pampas, zinc, lead, tin, iron ore, copper, manganese, uranium and petroleum. Argentina exports primarily raw materials and agricultural products to the European Union. The European Union exports machinery, chemicals, transport equipment and other manufactured goods to Argentina. The European Union is the biggest foreign investor in Argentina. The name of the currency used in Argentina is the Argentine Peso. It can freely be exchanged. The currency can be exchanged freely with 1 peso being equivalent to 0.13 US dollars. Greenfield investments are a good International business proposition. It is a form of foreign direct Investment. A parent company...
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...The 2008–2009 automotive industry crisis and regional unemployment in Central Europe Introduction- Employment in central Europe increased sharply due to the progress of the car industry, but such thing has its drawbacks since we cannot mainly focus on one industry to be the backbone of the economy. Consumers have different taste and may easily shift their interest to other firms outside the region; a clearer example would be that of the oil industry in GCC countries, as they stopped depending on oil as their essential survival and the only way by which they can boost their economy. What is even worst for central European countries is them being unable to control or possess their own industries, and the reason to that being external forces trying to get the upper hand. The launch of Hyundai line during the ends of 2008 helped the automotive industry to keep going, even if it was for a short period of time, because this line led to an increase of 3.2%. Nevertheless, we still cannot give a solid judgment of the state of the economy since the year before that witnessed a sharp decline of 1.1%. Some might believe this percentage is not a place to be worried, but global production continued declining till it reached 10% by 2009, the proportion was below the original expectation of the output for the industry. Those fluctuations led to the loss of 26000 jobs which eventually led to an economic crisis because of the escalation of unemployment that will have a cost to the region...
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...What should the government do to create jobs in the United States? The rate of unemployment in the U.S needs to be addressed by the federal government in order to arrive at a long term solution to the problem. Over the years, Americans have been urging the government to create new employment opportunities for the growing population. The U.S economy has indicated great recovery over the past decade but the unemployment problem is yet to be settled. The major problem is that the working population is constantly increasing but the creation of new jobs does not run parallel to it. Jobs are very scarce in the nation. This has caused the rates of unemployment to increase gradually. This paper focuses on what the U.S government can do to create jobs. An increase in government spending will definitely translate to creation of more job opportunities for the growing work force. This is mainly because as the government increases its projects across the states, it will need more people to work on the projects. The government requires a lot of labor on its projects and therefore, an increase in the government spending will create a labor deficit that will be filled in by a good number of the currently unemployed people. The government can attain this by expanding firms that will need more raw material suppliers and laborers. The initial expansion plan would also create jobs during the construction process. Building and maintenance of infrastructure can also create jobs for the people (Boushey...
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...Maximizing Foreign Direct Investment for prosperity in Lesser Developed Countries Over the past 30 years foreign direct investment has been a major contributor to economic growth across the globe. FDI inflows reached an all-time high in 2007 at $1.8 trillion with approximately 40% of that amount being invested in less developed countries. The prediction of this inflow into less developed countries was that it would be a wholly positive thing for the host country through resource transfer effects, employment effects, and effects on competition domestically and balance of payments. In the case of developed nations and even those in the upper tier of less developed nations this can be true but for the poorest of the less developed nations this has not been the case. In this essay we will examine why FDI has failed these nations and what can be done going forward to improve the economies of less developed nations by better utilizing FDI. To understand why FDI is not working in these less developed nations we must look at what are believed to be the fundamental effects of FDI on any host country. These effects include the increase in employment opportunities within the host country. They also include resource transfer effects whereby the skills and knowledge of the MNC are transferred to the host country. It is also expected that competition from MNC in domestic markets will force domestic companies to work more effectively to compete and thereby make these companies more effective...
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...Introduction This essay will explore the nature of NAFTA and its effect on regional integration as well as state economies from several perspectives. In 1993, the United States, Canada and Mexico signed the North American Free Trade Agreement to achieve the higher level of regional integration. This NAFTA not only concerns the removal of trade barriers, but also aims to promote the movement of capital. Firstly, this essay will explain the evolution of NAFTA and its successful influence on economic integration. Furthermore, this chapter will provide the criticism on the influence of NAFTA. Secondly, this study will discuss the impact of NAFTA on regional integration, particularly economic integration. Then, this essay will propose the understandings on the effect of NAFTA on members’ economies and businesses from four perspectives, including trade, economic growth, employment and FDI. Main body The Evolution of NAFTA The North American Free Trade Agreement (NAFTA) issued in 1993 aims to removal trade barriers and liberalise economics and business among the United States, Canada and Mexico. Compared with similar FTA economic relationship, such as EU, NAFTA is described as the most implemented FTA (Orme, 1996). Like most FTAs, NAFTA not only effectively coordinates resource and improves competitiveness of countries and corporates, but also promotes the movement of products, services and investment, even financial integration. For instance, Krugman & Hanson (1993) stress that...
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...Global Employment Trends 2012 Preventing a deeper jobs crisis INTERNATIONAL LABOUR OFFICE • GENEVA Copyright © International Labour Organization 2012 First published 2012 Publications of the International Labour Office enjoy copyright under Protocol 2 of the Universal Copyright Convention. Nevertheless, short excerpts from them may be reproduced without authorization, on condition that the source is indicated. For rights of reproduction or translation, application should be made to ILO Publications (Rights and Permissions), International Labour Office, CH-1211 Geneva 22, Switzerland, or by email: pubdroit@ilo.org. The International Labour Office welcomes such applications. Libraries, institutions and other users registered with reproduction rights organizations may make copies in accordance with the licences issued to them for this purpose. Visit www.ifrro.org to find the reproduction rights organization in your country. Global Employment Trends 2012 / International Labour Office – Geneva: ILO, 2012 1 v. ISBN 978-92-2-124924-5 (print) ISBN 978-92-2-124925-2 (web pdf) International Labour Office employment / unemployment / labour force participation / economic recession / developed countries / developing countries 13.01.3 Also available in French, Tendances mondiales de l’emploi 2012 (978-92-2-224924-4), Geneva, 2012, and Spanish, Tendencias Mundiales del Empleo 2012 (978-92-2-324924-3), Geneva, 2012. ILO Cataloguing in Publication Data The designations employed...
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...IMPACTS OF FOREIGN DIRECT INVESTMENT (FDI) Resource Transfer a) Capital Inflow Multinational companies that are able to do FDI usually have big funds. This might be because big multinational companies have good reputation to get loan from bank, compared to the local companies. With the inflow of capital into the host country, it will help the state to build better infrastructure, develop competitiveness in the industry, and boost the economy. b) Technology Transfer In any nation, the importance of technology is very important as it transfers to the growth of economy. Whenever FDI takes place, technology is transferred from the home country to the host country. It may be in form of machine transfer or knowledge transfer. For example in Malaysia, Proton collaborates with Lotus, and the technology of manufacturing car is transferred although it is not 100%. The vehicle manufacturing technology also help other Malaysian industry like rubber industry in making tires. c) Managerial Skills Transfer Management know-how is required through FDI process gives important benefit to the host county. Local employees hired by MNC are exposed to latest management skills that will improve the efficiency of operations in the host country. When foreign managers leave the firm, the trained local personnel will help to build indigenous firms, causing a beneficial spin-off effect to the host country. Employment Effect FDI brings more beneficial employment prospects to the host country...
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...The last time they were increased was in 2006, when the country’s economy was on course. As a rule, such changes occur at the time when the country’s economy is in a good state, with a steady increase in the employment rate and more jobs are being created. Economists have been quick to speculate that there was no better a time than this. For instance, there has been an increase in annual gross income for employees with more job creation opportunities. Before the end of this week, the Federal Reserve is expected to announce the new interest rates (Soergel, 2015). As any other economic tendency, it comes with its advantages and shortcomings to the saver and the borrower alike. Thus, it is necessary to analyze the effect such changes will have on various sectors of economy. Impact on the Stock Market The interest rate is the cost paid by the banks when borrowing from the Federal Reserve (Mueller, n.d.). It controls inflation by regulating the amount of money circulating in the economy and thus stabilizing the effects of demand and supply. Thus, the organization determines the amount of money available for goods on the market at any time (Mueller, n.d.). Consequently, an increase in Federal Reserve lending rate has a ripple effect on banks, which spreads to businesses and individuals as well (Mueller, n.d.). Most American retirees depend on interest rates on their savings (which are very low) for survival, and a hike in banking lending...
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...Macroeconomics and Rate of Unemployment Oria Cummings Embry-Riddle Aeronautical University Macroeconomics and Rate of Unemployment In essence, macroeconomics is the study of economy as a whole. Unlike microeconomics, which relates to the study of a single decision and ways it affects other economic variables, macroeconomics strives to understand aggregate economy and ways it is affected by changes in employment, local production, and inflation. Further, the government through the central bank and other bodies uses analytical models to understand changes in aggregate economic determinants such as economic growth or rate of employment thereby formulating policies that strive to accelerate economic growth. Understandably, one of the economic variables that help establish aggregate changes in the economy is changes in rate of unemployment. Unemployment refers to a number of persons ready and willing to work in particular type of a job at current market for pay but cannot secure one. In essence, unemployment as an economic indicator measures the health of the economy (Mercatus.org, 2016). For instance, high rates of unemployment indicate poor performing economy, while a decline in the rate of unemployment indicates a healthy economy or economic growth. Therefore, a measure of the rate of unemployment is an aggregate used to determine economic performance and changes that affect the overall performance of the economy. Therefore, this essay strives to elucidate aggregate economy...
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...(planned and collective), capitalism (individualistic and competetive), mixed (planned and individualistic – war capitalism, collective and planed – market socialism eg. China) 5. Name basic institutions of effective capitalism Provate property rights, market system, no corruption, monetary stability, openess of economy 6. Name basic recommendations or elements of merchantilism Encouraging agriculture, ecenomic wealth can be measured by precious metal (silver/gold); export over import, merchant fleet as vital importance, government involved in economy 7. Key elements of national competetiveness Basic institutions, infrastructure, stability 8. Name main elements of firm competetiveness Demand and supply, financal performance, investment ratio 9. When Keynesian policies to fight recession can not be applied? When there is a budget deficyt, high public debt, recession, no possibility to borrow money 10. How many arguments in favour of protection of infant industries can u name? Further development of this industry, reduction of unemployment, better situation in military Times, increase od Keynesian’s multiplier 11. Name arguments against protection High taxes for subsides, uncompetetive production, corruption, faulty specialization, trade wars, rise of prices, no scale benefits 12. What is dumping in economics? Dumping – selling below cost of production or below market...
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