...INTRO – -world econ growth definition -Firstly it can benefit the uk economy -this in turn benefits the individual within the UK Point 1 -Increased trading oppurtunities for uk companies, potentially leading to a more balanced UK -Due to the UK have a large export market for innovation and ideas as new country’s develop this market may increase as more firms may want to use their ideas, however this may also produce a much fiercer competition and other country’s will begin to develop their own ideas and their export market could decrease. China is becoming much more innovative and can use its own cheap manufacturing base giving them a large competitive advantage which the UK may not be able to exploit as easily if the economy continues to grow -less developed countries which often supply will gain more power over buyer so cheap production may be less available pushing up uk general prices causing inflation, Chinas cheap manufacturing may become more expensive Point 2 -Individual -Increased exports as a result of more trading opportunities may increase employment opportunities for individuals as more production is needed to supply for other countries -philips curve, increased employment may lead to inflation making UK prices more expensive, however inflation does also trigger a devaluation of the pound boosting exports more which can boost the economy and make the UK richer and more competitive in the export market which could increase the individuals standard...
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...Economic Growth and Public Policy of the UK: Does the protectionism help? Introduction The effects of globalization have touched all the aspects of life and business today. One aspect is the trading policies between countries. Since the late nineteenth century, the collision started between domestic and foreign industries, which ask governments for measures that could protect local industries, without discouraging the country’s trade relations. The term ‘Protectionism’ was thus introduced in the language of global trade and economy (Rowley, 2002). Protectionism is an economic policy applied in the trading system, to restrict the quantity of imported items, and to flourish country’s exports. The objective of this is policy is to maintain the competition between foreign and the domestic industries. In most of the countries, free trade is not followed and various tariffs and duty charges are applied on the import goods. These taxes allow the government to generate a fair bit of revenue, without utilizing their resources. Moreover, it also helps in the sustainability of the domestic industries. The prices of the imported goods are kept higher by adding these taxes so that the local customers, looking for cheaper options, have to buy the domestic items. In parallel to this, the protectionism policy allows domestic industries to raise the prices of their products, without raising the quality of their products (Ethier & Fischer, 1987, pp.1-2). Another aspect of protectionism...
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...Chapter 1-Economic Factors Throughout this chapter I shall be investigating Rolls-Royce and how their operations are influenced by the UK and Chinese economies. I shall also be contrasting the challenges faced by them in two different business environments. Introduction to Rolls-Royce Rolls-Royce (RR) is a renowned, prestigious car-manufacturer and more recently aero-engine manufacturing company. They were founded by Charles Stewart Rolls and Sir Frederick Henry Royce in 1906, resulting from a partnership established in 1904. Although known for being British, the German car company Volkswagen bought the company for £430 million in 1998. Economic stability in the UK and China Economic stability: “Economic stability refers to an absence of excessive fluctuations in the macro- economy. An economy with fairly constant output growth and low and stable inflation would be considered economically stable.” - http://www.businessdictionary.com/definition/economic-stability.html To be economically stable requires an economy to have an absence of: frequent recessions, a pronounced business cycle, high or variable inflation rates, frequent financial crisis or a high unemployment rate. The UK is prone to a variety of these issues and as a result would not be considered to have “economic stability”. However, recently the economy is on the rise and therefore is on a stable recovery. This is why over the past few years’ sales of RR cars have increased in the UK. Economic stability is crucial...
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...K economic performance in 2007 The level of the inflation rate in 2007 is 2.3 annually. There was a level trending rate across the months of 2007. The UK has experienced its fastest growth since 2007 and is currently being the fastest growing major developed economy. Annual growth rates averaged 2.68% between 1992 and 2007. In 2007, UK had the world third’s largest current account deficit due to mainly a large deficit in manufactured goods. The UK in 2007 had government debts at 35.5% of GDP. The unemployment rate in the UK for 2007 was about 6.0 % Summary of UK economic performance in 2012 The unemployment level or rate for 2012 was 7.9%. The level of GDP growth for Uk was 0.8% and the inflation rate was 2.83%. The UK economy fell during 2012. The level of output in the first three quarters of the year was little changed from the period of 2011. There was a disappointing foreign trade performance and export volumes rose only by 0.2 %. Export volumes are the imports of individual countries on a constant price basis. This means that the UK slightly increased their importing. Mark and Spencer’s performance Market Overview Gross Domestic product is predicted to grow by 2.7% in 2008. The total revenues were up 5.1% driven by new space in the UK and strong performance in our international business. Operating profit before property disposal and exceptional items was £1,089.3m up 4.3%. The UK gross margin was 0.4 percentage points down on the year at 43.0” mostly due to...
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...GDP VS HDI The monetary value of all the finished goods and services produced within a country's borders in a specific time period, though GDP is usually calculated on an annual basis. HDI: The Human Development Index (HDI) is a statistical tool used to measure a country's overall achievement in its social and economic dimensions. UK currently 14 on the HDI, were 9th in Europe UKs GDP position is 6th China are 91st on the HDI and GDP is 2nd "Although the economy in China is very large, the income of Chinese people is still much lower than in many developed countries," "and I think environmental pollution also affected China's ranking on the list." Countries high on the Human Development Index tend to have annual population growth rates of 1 percent or less, high urban population percentages (65 percent and up) and balanced percentages of people under 15 and over 65 years of age. Those low on the index tend to have annual population growth rates of 1.5 percent or higher, less than 35 percent of the population in urban areas, and an under-15 population that greatly outnumbers those above 65 years (in most cases, more than 10 times as many.) There is today a very strong correlation between rising GDP/capita. If you exclude 6 countries on the right side of the strong correlation that have higher GDP/capita than HDI due to oil or diamonds; and if you exclude 6 former Soviet Republics with collapsed economy but still high literacy rate on the left side of the correlation;...
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...The UK’s macroeconomic performance can be measured in terms of economic growth, inflation, unemployment and the balance of payments on the current account. One importance of higher labour productivity in the UK is that it means that each member of staff produces more output in the same given time period which will improve the economies position on the PPF by moving closer towards the curve. This is because the economy will be producing more output with the same amount of resources available which indicates a previous under-utilisation of labour in the economy. Furthermore, another importance of higher labour productivity is shown in Extract C, ‘any rise in aggregate demand (AD) will be non-inflationary when improvements in productivity are able to generate greater output,’ which empathises the importance of higher labour productivity in the long-run in terms of economic growth because the output of the economy is increasing without inflation. The benefits of low inflation rates are widespread, particularly to those who have savings. Another reason for why this could be considered is due to the fact that it increases the competiveness of the UK’s trade world-wide, for example because the average cost of producing one good has decreased the firms will have more freedom to lower prices, this has a positive effect on the balance of payment on the current account by bringing it into more surplus. On the other hand, an increase in the labour productivity could potentially result...
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...Economic growth is increases in output. It can occur if previously unemployed resources are employed, there are more resources or existing resources improve in quality (Grant and Stanlake, 2000:285). According to the report, the economic gap between the north and the south of the United Kingdom was significantly enlarged in 10 years (White, 2015). Regional outcomes in Britain have exhibited strong signs of divergence and asymmetries on the basis of a North-South divide for over twenty years (lse.ac.uk, 2006). The purpose of this essay is to examine the regional imbalance in the United Kingdom. After first explaining measurable growth by some economic theories, it will analyse actual and potential growth by drawing business cycle and LRAS diagrams. Next, it will analyse the reasons for regional imbalance. Finally, it will evaluate actual supply side policies. Real GDP measures the value of goods and services produced at constant prices, the change of the real GDP only reflects the change of the quantity of production. In addition, people prefer to use real GDP than nominal GDP because real GDP reflects the economy’s ability to satisfy people’s needs and desires (Mankiw and Taylor, 2011:496-497). According to below graph, it shows that UK economy has experienced up-and-down swings in the years since 2003. Before 2008, growth more stable between 0.2 and 1.8 per quarter. However, GDP is more unpredictable after 2009. (Source: BBC news, 2015) The first type is actual growth which...
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...of demographics, language, currency, political system, predominant industries, and current (i.e. last year) economic indicators such as nominal GDP, GDP per capita, unemployment, budget deficit (% of GDP), balance of payments accounts (% of GDP), and inflation. II. Brief description of the behavior of various economic indicators at the last 20 years III. Brief description of the behavior of various economic indicators for at the last 20 years IV. The relationship between the accounts in the balance of payments, average interest rate, and the government budget balance. Is there any relationship among these variables that the economic theory tells us? 1. A brief description of this country in terms of demographics, language, currency, political system, predominant industries, and current (i.e. last year) economic indicators such as nominal GDP, GDP per capita, unemployment, budget deficit (% of GDP), balance of payments accounts (% of GDP), and inflation. The country has recorded a population of 62.3 million in 2010 up from 52.4 million in 1960. The analysis shows an increase in population growth by about 18% over the last five decades. The world statistics indicates that the UK’s population accounts for 0.9% of the total world’s population. The results show that in every 112 persons living on the planet earth, one of them is a resident of the UK (The trading economics.com n.p). Politics and employment Political systems play a significant role in shaping...
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...for a country to progress, it is important for the country to have adequate economic growth and development and this growth is determined mainly by macro-economic factors such as Gross domestic product, money supply, foreign exchange rates, rate of inflation etc. This detailed project analyses the Macroeconomic indicators of two economies namely United Arab Emirates and United Kingdom. The report is a comparative analysis of the two countries over a timeframe of 10 years (2003 -2012). Section 1 deals with country profiles that briefly mention their geography, people, production followed by the next section that contains the respective countries macroeconomic indicators. Under this the major indicators will be explained...
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...the past several decades, which stimulates the development of organizations and better corporate performance. There are different kinds of national business systems with their distinctive characteristics varying among countries. Then ‘early’ and ‘late’ industrialization is applied to describe two main types of national businesses that existing in developed and developing countries, which explains the key institutional and organizational differences among countries in particular to some extend. Each country has fallowed different pathway and carried out their industrialization in different period. It is known that the UK is the first country that achieved early industrialization revolution, which was followed by the US. And then in the late twentieth century, Germany, Japan and China implemented their industrialization process with dramatic change on their economic performance. The purpose of this essay is to use the conception of ‘early’ and ‘late’ industrialization to explain the key institutional and organizational characteristics of national business systems by comparative perspective. First of all, the theories of industrialization will be displayed. Then this paper will concentrate on five main comparative countries, which are United States, Japan, Britain, Germany and China, to clarify major differences of national business systems. Moreover, further implications and debates upon these countries long-term national competitiveness will be given to assess the...
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...Maris Farquharson Discuss the relationship between entrepreneurship, innovation and economic development. Yasong Zhao Student ID: 6511938 Word Count:1994 1. Introduction Over the past decade or so, the term entrepreneurship has become a fashionable way to describing the attempts at large-scale change by individuals and organizations. During this procedure, Innovation as the most important component of entrepreneurship is at a leading place, whereas, the combination of the two is vital to economic growth and sustainability in today’s dynamic and changing business environment. As a result, exploring the synergy relationship (either conceptual or practical) between entrepreneurship, innovation and economic development is gaining significance. They are complementary and related to each other, not at an initial stage of a new venture; rather they are dynamic and holistic processes. This integrative interaction between the three has had a positive and comprehensive impact to the whole society. Therefore, the role of sustainability is highlighted as the guidance to entrepreneurial and innovative decision making in the organisations or by individuals. This paper will first look into the relationship of the three by discussing each two of them, and then focus on the importance of sustainability from ecology, economy and social levels. 2. Relationship between entrepreneurship, innovation and economic development 2.1 Entrepreneurship and innovation The integrative framework of the...
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... OVERVIEW Catalyst This profile analyzes the political, economic, social, technological, legal and environmental (PESTLE) structure in the UK. Each of the PESTLE factors is explored on four parameters: current strengths, current challenges, future prospects, and future risks. Summary Key findings The UK has a strong democratic system, but differences between coalition partners in the incumbent government pose a challenge The UK adheres to a democratic, parliamentary system of governance known as the Westminster system. This system ensures adequate distribution of power between the executive branch led by the prime minister, the bicameral legislature and the judiciary. Growing ideological differences between the Conservatives and Liberal Democrats in the current government is making the coalition vulnerable. Tensions between pro-Europe Liberal Democrats and euroskeptic Conservatives continue to plague British politics. Further, conflicting views on issues such as welfare reforms, immigration and the economy are straining relations. The UK economy is developed, but rising government debt remains a concern The UK is one of the largest economies in the EU and is one of the strongest in terms of social welfare and standard of living. Among the EU countries, the UK has one of the highest levels of per capita GDP in terms of purchasing power parity. According to the World Bank's Doing Business indicators for 2013, the UK is the seventh best country in the world to do business. The...
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...Explain and evaluate the neo-classical theory of long-run economic growth. In light of this theory what useful insights can be gained concerning the economic growth process of the UK economy over the past few decades? In recent year’s macroeconomists have become increasingly dissatisfied with Solow’s neoclassical theory of long run economic growth, through scrutiny of its application to the real world. (Gordon, 2006). In this essay these criticisms are going to be addressed first by explaining the theory, then considering the effect of changing different variables such as the savings rate, population growth and technical progress. The theory will then be applied to the UK economy over the past few decades discussing its relation to slow and rapid growth in certain periods. To conclude, criticisms will then be discussed to value the theory against reality. The neoclassical theory of long term economic growth is determined by marrying the production function and the savings investment line (Gordon, 2006). The production function studies the relationship between real GDP (Y) and the ‘autonomous’ growth factor (A) along with capital (K) and labour (N). This is shown by the equation Y=AF (K, N) (Gordon, 2006). The function tells us that sources causing an increased standard of living derive from the autonomous factor and the capital intensity. The per person production function shows how much output can be produced by a given quantity of factor input and is illustrated...
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...Primark is one of UK’s largest clothing retail stores with a reported revenues of £4,273 million, the store was first established in Ireland in 1969. Over the past ten years Primark has become extremely successful with its expansions into the United Kingdom where 165 stores are now available and more than 250 stores around Europe (Wood 2014). Earlier this year, Primark’s parent company announced its intention to enter the US market with a first store opening in Boston MA in 2015, the opening will be shortly followed by another ten new stores across the country (smith 2014). This can be a risky strategy as the shift towards a more globalised market means companies who have been successful in their home market (such as Primark) will find themselves competing with foreign businesses which are much bigger and more successful. However, International expansion offers businesses the opportunity to become recognised on a global scale, for example, companies such as Coco Cola, McDonalds and Microsoft could not have achieved global leadership within their industry without expanding abroad, therefore International expansion offers international reputation which is necessary when wanting to become a leader. Internationalization Theory The Uppsala model (a.k.a the Stage Model) is an important theory that explains how firms expand abroad, under this model, internationalization is seen as an incremental process whereby firms increase their international involvement in a stepwise manner...
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...Two Business on Our Doorsteps and Similar Business in Different Worlds Student Name Student ID Date Two Business on Our Doorsteps and Similar Business in Different Worlds Introduction to the Businesses under Consideration: The study focuses on the analysis of two American-based companies. One an NGO whiles the other a profit making organization. The company AT&T is Telecommunications Company providing mobile services to its people while the other USAID is an NGO. These two companies differ in size with AT&T having an international coverage but more focused on developing its local market while USAID is focused on solving problems related to poverty around the world. These indicate USAID to have a higher mandate compared to that of AT&T. The study article reveals aspects relating to the two companies and their activities towards attaining their objectives. Description of the Types of Businesses: AT&T: The company formally known as SBD Communications Inc changed the name to AT&T in 2005 to improve its brand image and capabilities to tap into the market and from which it built a base for expansion into new markets in 2013 (Moloshok, 2011). The company AT&T Inc is a telecommunications company focused on service provision on an international level and local level within the United States. For years since its inception, AT&T has operated two major segments in its business. These include the wireline business and the wireless. The wireless sector...
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