Wednesday, May 30, 2012
Last Blog Reflection
Blog Assignment: Reflection
a) What did you learn in this class that you believe will be most directly applicable to understanding how the world works?
I think that the most applicable to understanding how the world work is the EGT consultant paper in which we did research on our countries and also learn about the three type of different market (scooter, limousine and sedan). I also found the buying corn activities along with the shipping container activity to be very interesting and helpful to understanding today’s issues relating to economics and transportation of goods across countries. Another activity is calling the banks to learn about the exchange rates and fees, which was a pretty interesting activity. It may be hard to get different kinds of currency and is quite useful for study abroad students since they are going to another country and will need that country’s currency.
b) What topics are you interested in learning more about, after his class ends?
Other topics that I want to learn more about are how other markets works. For example if we were to look our study abroad country but instead of looking at the automobiles and vehicles markets we should try out other products as well. I think that it is also important to do more presentations with business more like activities and learn about the cultural differences in class. Maybe combine little parts of business in to this economic class for us as students to understand how closely business and economic is related. I think that also learning about negotiation is quite important too and we should learn more about it. Maybe have an intro to negotiation and persuasion which can eventually lead us to take the negotiation and persuasion class.
c) What advice would you give to a student considering taking this class?
The advices that I would give to future students taking this course is that for the presentation, they should really practice because time limit is quite important. Learn how to use concise words and cover important points. As for the reading, make sure to read all the reading because they are very important for discussion and for having a better understanding of economics. Writing papers for this class, I would say it takes the most time and require a lot of time beforehand to research so start early due to that it is important to analyze the country from many perspective and see which markets is suited best for the country. Don’t forget to do blogs because blogs help you process your thinking on the readings. Overall I got a lot out of the class and would recommend it to students going on study abroad because it helps to know the situation in that country.
Monday, May 28, 2012
US to push for changes on yuan Weekly # 4
Blog Weekly #4
US to Push for Changes on Yuan
http://usa.chinadaily.com.cn/us/2012-05/28/content_15402369.htm
Officials ask Beijing for more flexibility
The United States on Friday shied away from naming China as a "currency manipulator", but said it would "press for policy changes that yield greater exchange rate flexibility" in the yuan.
In its latest semi-annual report to Congress, the US Treasury Department said Chinese commitments to strengthen the currency and the decline in China's current account surplus showed that Beijing was not manipulating its currency. China has also made progress in allowing the yuan to appreciate against the dollar since June 2010.
If the department found China to be manipulating its currency, President Barack Obama's administration would have to take formal steps to press for the yuan's revaluation. If talks fail, the US could impose trade sanctions.
Treasury and other administration officials have argued that such pressure could be counterproductive given that the Chinese government owns more than $1 trillion in US sovereign debt. The last time China was labeled a "currency manipulator" was in 1994.
But the report stressed that the Chinese currency remained significantly undervalued and further appreciation of the renminbi against the dollar and other major currencies was warranted.
Reacting to the report, John Frisbie, president of the US-China Business Council said Treasury made "the right call" in its policy decision.
"Branding China a currency 'manipulator' triggers nothing to help reach the goal of a fully convertible currency and market-driven exchange rate for China," Frisbie said in a statement. "In addition, the 'manipulator' label would likely lead China to react negatively and slow down progress on this issue."
The Treasury Department noted that China has pledged to move rapidly to a "more market-determined exchange rate system" in recent forums such as the Group of 20 and the US-China Strategic and Economic Dialogue.
The yuan has risen in value by 40 percent, after adjusting for inflation, against the dollar since 2005, when China began implementing currency reforms. But in 2012, Treasury said, "The yuan has been virtually flat against the dollar."
China's global current account surplus - meaning the country exports more than it imports - has dropped substantially, from 9.1 percent of gross domestic product in 2008 to 2.8 percent of GDP at the end of 2011, according to Friday's report.
During that four-year period, the US trade deficit with China has widened by a comparatively modest $22 billion, from $273 billion to $295 billion, according to the USCBC.
"The facts show that China's exchange rate is not the significant factor in the US trade deficit or US employment that many make it out to be," Frisbie said.
In a recent USCBC survey, exchange rate was ranked 26th as a factor affecting US sales to China, five places lower than the previous year.
US political leaders, including Republican presidential candidate Mitt Romney, have accused China of manipulating its currency, a move they say makes American exports less competitive. Romney had said that if he is elected he would identify China as a currency manipulator on his first day in office.
Some experts say the US has focused too much on the currency issue while neglecting opportunities that could benefit both economic powers.
Li Ruogu, chairman and president of the Export-Import Bank of China, said at a recent event hosted by the pro-growth New York Forum that the global economy depends on a close economic relationship between China and the US. The world can't afford a trade war between the two nations, he said.
Reponses to the article:
Although it was interesting to see that China and the United States are relatively arguing over the currency rate, I also do agree with the author that “The world can't afford a trade war between the two nations.” This is due to that both China and the United States need each other in order for both economies to be successful. China needs the United States for growing its economy, increasing GDP and United States needs china for consumption and its cheap labor.
The issue of “US political leaders, including Republican presidential candidate Mitt Romney, have accused China of manipulating its currency, a move they say makes American exports less competitive” makes China a greedy country more or less. As the US labels China as a currency manipulator can cause problems to the economy because the US is not focusing on the other benefits and advantage to the economic relationship but rather agues about the currency.
This article overall is interesting because the issues of exchange in currency really play a great impact on the market in the two different countries causing debates and may result in a unstable relationship.
Works Cited:
Zhang, Yuwei. "US to push changes on yuan." ChinaDaily USA. N.p., n.d. Web. 28 May 2012. <http://usa.chinadaily.com.cn/us/2012-05/28/content_15402369.htm>.
Monday, May 21, 2012
Beware of Greeks Bearing Bonds
Beware of Greeks Bearing Bonds by Michael Lewis
http://www.vanityfair.com/business/features/2010/10/greeks-bearing-bonds-201010
1) Choose one passage from the reading that you found particularly interesting. Why was it interesting?
I found this article to be interesting in that Greek is not talk much about besides tourism or history/English class. I never thought much about Greek’s economy or its monastery. One of the interesting passages in this article is that,
“The Greek state was not just corrupt but also corrupting. Once you saw how it worked you could understand a phenomenon which otherwise made no sense at all: the difficulty Greek people have saying a kind word about one another. Individual Greeks are delightful: funny, warm, smart, and good company. I left two dozen interviews saying to myself, “What great people!” They do not share the sentiment about one another: the hardest thing to do in Greece is to get one Greek to compliment another behind his back. No success of any kind is regarded without suspicion. Everyone is pretty sure everyone is cheating on his taxes, or bribing politicians, or taking bribes, or lying about the value of his real estate. And this total absence of faith in one another is self-reinforcing. The epidemic of lying and cheating and stealing makes any sort of civic life impossible; the collapse of civic life only encourages more lying, cheating, and stealing. Lacking faith in one another, they fall back on themselves and their families.”
This was an interesting passage in the article because it explains the current situation in Greece and if you do not know much about Greeks or its economic situation; it basically states that Greece is not doing so well economically and that Greece is corrupted to that extent that nothing is trustable. Children will not learn anything in public school, and the government and tax collector accepts bribes. This gives Greece a bad reputation as a country but also releases important information about the country. This passage was also were informative.
One of the shocking passages that I have never heard about was the island where women are not allowed.
“Mount Athos now is severed from the mainland by a long fence, and so the only way onto it is by boat, which gives the peninsula the flavor of an island. And on this island no women are allowed—no female animals of any kind, in fact, except for cats. The official history ascribes the ban to the desire of the church to honor the Virgin; the unofficial one to the problem of monks hitting on female visitors. The ban has stood for 1,000 years.”
This was very interesting in that for 1000 years women could not enter Mount Athos and so I found this to be very interesting too because in most areas of the world both male and female are allows to go where they pleased but an island where woman are banned can create an interesting argument for critics or other readers.
2) Greece’s economy is very small compared to other European Union economies, yet problems in Greece threaten the rest of Europe. Why?
Greece’s economy is very small but it threatens the rest of Europe because Greece has been historically a very important region in Europe and had existed for a long, long time. Greece’s economy although it is not going well, it is still one of the important economies in that they recently adopted the Euros and have one of the largest economies in Europe.
3) As part of a European bailout, Greece agreed to an austerity program of large cuts in government spending and increases in taxes. The Greek public has strongly opposed these measures. Use the short-run national Income model to explain this opposition.
Looking at the Short run national income model
GDP = C + I + G + Nx
If Greece agrees to cut government spending and increase tax, this will make
GDP↓ = C↓ + I + G ↓ + Nx
If Government spending is decreasing, Consumption will also decrease causing a decrease in GDP. This follows the contractionary fiscal policy. On the monetary side this will increase the interest rate and decrease money supply.
Works Cited:
"Beware of Greeks Bearing
Bonds."Vanity Fair. N.p., n.d. Web. 21 May 2012.
<http://www.vanityfair.com/business/features/2010/10/greeks-bearing-bonds-201010>.
Sunday, May 20, 2012
China Eyes Japan as the Land of Opportunity Weekly # 3
China Eyes Japan as the Land of Opportunity
Weekly Blog #3
http://www.businessweek.com/articles/2012-05-10/china-eyes-japan-as-the-land-of-opportunity
Article
As China’s most successful telecom equipment company, Huawei Technologies had more than $32 billion in sales last year and a strong presence in Europe, India, the Middle East, and other countries. Japan is another story. Huawei’s sales in the world’s third-largest economy amounted to no more than $700 million in 2011, tiny for a company of its size. Huawei has been in Japan since 2005 but as the numbers show, “we are still very small,” says Yan Lida, Huawei’s Japan president.
China may enjoy a healthy trade surplus with the U.S. and Western Europe, but when it comes to Japan, the Chinese are always in the red. Last year China had a $19 billion trade deficit with Japan, thanks in part to Chinese imports of made-in-Japan machinery and components. Japan is the second-largest supplier to Huawei, after the U.S., with the Chinese company buying $750 million in Japanese parts in 2011. In return, the Japanese buy such low-cost Chinese goods as apparel, food, and electronics.
Some Chinese companies are pushing harder to convince Japanese consumers to put aside their doubts and give Chinese products a try. In April, white-goods maker Haier opened a research and development center in Kyoto, its second lab in the country, and in February announced it would put its Asian headquarters in Osaka. The moves are part of a big Japanese push by Haier, which last year agreed to buy Sanyo Electric’s consumer appliance businesses in Japan and Southeast Asia from Panasonic (PC). Chinese PC vendor Lenovo last year invested $175 million in a new joint venture with NEC to sell computers in Japan. Shenzhen-based telecom equipment and handset maker ZTE is boosting sales of smartphones and 4G equipment to Japanese customers such as Softbank. So is Huawei. Boosting Japanese purchases of Chinese-made products is on the agenda for both countries. Trade ministers from China, Japan, and South Korea will meet on May 12 to discuss a possible free-trade agreement. In December, Chinese Premier Wen Jiabao hosted Japanese Prime Minister Yoshihiko Noda in Beijing, with the two leaders agreeing to promote trade by encouraging the use of their currencies for cross-border transactions rather than the U.S. dollar. Deepening ties between China and Japan “is necessary and possible,” Wen said at a meeting with Noda at the Great Hall of the People, the official Xinhua news agency reported.
Given Japan’s contracting economy, chronic deflation, and shrinking population, why should the Chinese even bother boosting ties? For all its problems, Japan’s roughly $5.9 trillion economy is Asia’s second-largest after China. For now there’s money to be made there, says Zhang Jiangguo, ZTE’s vice president and chief technology officer for Asia-Pacific. Japanese telecom operators “will still put huge investment in network infrastructure,” he says, estimating there’s $100 billion a year up for grabs. Given those numbers, “We don’t think the Japanese market is shrinking.”
A foundation in Japan could also help Chinese companies establish their brands worldwide. Meeting the quality levels and technology standards Japanese companies expect should enable the Chinese to become stronger in other, faster-growing markets. That’s the argument Du Jingguo, Haier vice-president, made in a statement at the opening of the R&D center in Kyoto. “Japan is world-renowned for its state-of-the-art technology,” he said. “So we are confident that products designed for this competitive market will succeed globally.”
Japanese consumers don’t quite know what to make of Chinese products. They are unfamiliar with Chinese brands, and when they think of them they associate them with steep discounts. Chinese companies, facing wage pressures at home, cannot rely solely on low prices to take share in Japan. To overcome the cheap image problem, Haier is selling washing machines under a separate brand developed by Sanyo called Aqua.
Mainland companies still rely on Japanese-made machinery and components, which will keep up the pressure on the trade numbers. “Japanese have a major competitive advantage in high-end capital goods,” says Kevin Lai, an economist with Daiwa Capital Markets. “That is not something the Chinese can change in the near future unless they can innovate.”
The Chinese have reasons to be hopeful. Last year’s deficit with Japan was about half the size of 2010. Moreover, the dismal prospects of money-losing Japanese giants such as Panasonic and Sharp create opportunities for Chinese products. Before the advent of smartphones, local champions were the favorites of local consumers. Today, two foreign companies, Apple (AAPL) and Samsung, dominate the Japanese market. “The market is not so closed,” says ZTE’s Zhang, who says there’s room to make inroads with products designed for Japanese tastes. He’s optimistic about a new waterproof smartphone for Softbank. “Japanese like to take saunas,” he explains. “We provide this kind of handset so they can enjoy their bath and in the meantime call their friends.”
The bottom line: China wants to cut back its $19 billion trade deficit with Japan by selling more electronics and appliances to the Japanese.
Response:
China and Japan’s relationship has always been an interesting relationship because of history. This articles further talks about the future of Japan and China’s economic relationship. With China wanting Japan to buy more goods from China, this can be beneficial to China and improve their economy. As for China, creating more agreements with Japan can lead to other advantages as well, for example with Japan’s purchases, this can make a certain brand name more popular and through Japan it can be advertized globally. Huawei Technologie is one example that was explained in the article about China and Japan relations. One of the interesting points made in the article is that both Japan and China needs to trade with each other and by doing this, China need to have a better relationship with Japan being in a position where it needs to make more purchases. China purchases a lot of goods from Japan and because Japan is relatively a more expensive country, it creates inequality for China and a negative trade surplus. I found this article to be interesting because trade is always an important matter when dealing with countries but along with agreements, the countries relationship is also another matter that greatly impacts the trade negotiations.
Weekly Blog #3
http://www.businessweek.com/articles/2012-05-10/china-eyes-japan-as-the-land-of-opportunity
Article
As China’s most successful telecom equipment company, Huawei Technologies had more than $32 billion in sales last year and a strong presence in Europe, India, the Middle East, and other countries. Japan is another story. Huawei’s sales in the world’s third-largest economy amounted to no more than $700 million in 2011, tiny for a company of its size. Huawei has been in Japan since 2005 but as the numbers show, “we are still very small,” says Yan Lida, Huawei’s Japan president.
Photograph courtesy HaierHaier products on sale in Tokyo
China may enjoy a healthy trade surplus with the U.S. and Western Europe, but when it comes to Japan, the Chinese are always in the red. Last year China had a $19 billion trade deficit with Japan, thanks in part to Chinese imports of made-in-Japan machinery and components. Japan is the second-largest supplier to Huawei, after the U.S., with the Chinese company buying $750 million in Japanese parts in 2011. In return, the Japanese buy such low-cost Chinese goods as apparel, food, and electronics.
Some Chinese companies are pushing harder to convince Japanese consumers to put aside their doubts and give Chinese products a try. In April, white-goods maker Haier opened a research and development center in Kyoto, its second lab in the country, and in February announced it would put its Asian headquarters in Osaka. The moves are part of a big Japanese push by Haier, which last year agreed to buy Sanyo Electric’s consumer appliance businesses in Japan and Southeast Asia from Panasonic (PC). Chinese PC vendor Lenovo last year invested $175 million in a new joint venture with NEC to sell computers in Japan. Shenzhen-based telecom equipment and handset maker ZTE is boosting sales of smartphones and 4G equipment to Japanese customers such as Softbank. So is Huawei. Boosting Japanese purchases of Chinese-made products is on the agenda for both countries. Trade ministers from China, Japan, and South Korea will meet on May 12 to discuss a possible free-trade agreement. In December, Chinese Premier Wen Jiabao hosted Japanese Prime Minister Yoshihiko Noda in Beijing, with the two leaders agreeing to promote trade by encouraging the use of their currencies for cross-border transactions rather than the U.S. dollar. Deepening ties between China and Japan “is necessary and possible,” Wen said at a meeting with Noda at the Great Hall of the People, the official Xinhua news agency reported.
Given Japan’s contracting economy, chronic deflation, and shrinking population, why should the Chinese even bother boosting ties? For all its problems, Japan’s roughly $5.9 trillion economy is Asia’s second-largest after China. For now there’s money to be made there, says Zhang Jiangguo, ZTE’s vice president and chief technology officer for Asia-Pacific. Japanese telecom operators “will still put huge investment in network infrastructure,” he says, estimating there’s $100 billion a year up for grabs. Given those numbers, “We don’t think the Japanese market is shrinking.”
A foundation in Japan could also help Chinese companies establish their brands worldwide. Meeting the quality levels and technology standards Japanese companies expect should enable the Chinese to become stronger in other, faster-growing markets. That’s the argument Du Jingguo, Haier vice-president, made in a statement at the opening of the R&D center in Kyoto. “Japan is world-renowned for its state-of-the-art technology,” he said. “So we are confident that products designed for this competitive market will succeed globally.”
Japanese consumers don’t quite know what to make of Chinese products. They are unfamiliar with Chinese brands, and when they think of them they associate them with steep discounts. Chinese companies, facing wage pressures at home, cannot rely solely on low prices to take share in Japan. To overcome the cheap image problem, Haier is selling washing machines under a separate brand developed by Sanyo called Aqua.
Mainland companies still rely on Japanese-made machinery and components, which will keep up the pressure on the trade numbers. “Japanese have a major competitive advantage in high-end capital goods,” says Kevin Lai, an economist with Daiwa Capital Markets. “That is not something the Chinese can change in the near future unless they can innovate.”
The Chinese have reasons to be hopeful. Last year’s deficit with Japan was about half the size of 2010. Moreover, the dismal prospects of money-losing Japanese giants such as Panasonic and Sharp create opportunities for Chinese products. Before the advent of smartphones, local champions were the favorites of local consumers. Today, two foreign companies, Apple (AAPL) and Samsung, dominate the Japanese market. “The market is not so closed,” says ZTE’s Zhang, who says there’s room to make inroads with products designed for Japanese tastes. He’s optimistic about a new waterproof smartphone for Softbank. “Japanese like to take saunas,” he explains. “We provide this kind of handset so they can enjoy their bath and in the meantime call their friends.”
The bottom line: China wants to cut back its $19 billion trade deficit with Japan by selling more electronics and appliances to the Japanese.
Response:
China and Japan’s relationship has always been an interesting relationship because of history. This articles further talks about the future of Japan and China’s economic relationship. With China wanting Japan to buy more goods from China, this can be beneficial to China and improve their economy. As for China, creating more agreements with Japan can lead to other advantages as well, for example with Japan’s purchases, this can make a certain brand name more popular and through Japan it can be advertized globally. Huawei Technologie is one example that was explained in the article about China and Japan relations. One of the interesting points made in the article is that both Japan and China needs to trade with each other and by doing this, China need to have a better relationship with Japan being in a position where it needs to make more purchases. China purchases a lot of goods from Japan and because Japan is relatively a more expensive country, it creates inequality for China and a negative trade surplus. I found this article to be interesting because trade is always an important matter when dealing with countries but along with agreements, the countries relationship is also another matter that greatly impacts the trade negotiations.
Thursday, May 17, 2012
Orville Schell "Walmart in China"
“How Walmart is changing China” by Orville Schell
http://www.theatlantic.com/magazine/archive/2011/12/how-walmart-is-changing-china/8709/
1). Choose one passage from the reading that you found particularly interesting. Why was this interesting?
One passage that I found to be interesting was talking about how market is basically its own country. Within the article the writer mentions a metaphor basically stating that Wal-Mart (Company) is like a country, which is very interesting to me because it did not occur to me that Wal-mart as a big company can be something that can function like a country. In the article it states, “In many ways, the company is like a country. Its CEO, when abroad, is treated almost like a visiting head of state. Senior executives in charge of overseas operations function like diplomats, signing agreements with governments and businesses and managing the company’s interests. The various national arms of the Wal-Mart Foundation operate almost like a government foreign-aid program. Even Wal-Mart’s stores, arrayed around the world, seem almost as representative of America as our consulates and embassies.” After reading the article it made more sense as to how a company can be a country.
2). Use examples from this reading to illustrate the interaction between multinational firms, economics, and culture.
One of the examples in the reading where there is an interaction between multinational firms, economics, and culture is when the author connects China’s thoughts to Wal-mart’s thought. It states, “China’s leadership, with its socialist roots, has long stressed “serving the people,” while Walmart, with its capitalist roots, emphasizes “service to the customer.” Both statements are relates to the people and is about the people, placing a high importance on the civilians. The next example was the South Park episode on boycotting the stores. It basically talk about ways to stop the spread of the multinational firms but at the end, the people cannot do it and keeps going to the store because market is needed and consumption is needed. A conclusion for the episode is that “the South Park posse must save the world by finding and destroying the heart of their Walmart, which turns out to be located near the TV-sales department.”
Towards at the end of the article an important statement that Lucy mentions is that multinational firms is not necessary a bad thing in China. In fact “Chinese workers learned a lot about quality, pricing, and management from Walmart,” She states, “At first, we didn’t quite understand, but they patiently explained consumer demand to us. So we came to understand that Walmart not only had vision about these things, but also were the strictest in maintaining standards. Now we have started moving from green to organic.” This help China became a better country with food standards and regulation.
3). Beyond the specifics of this article, what impact do multinational firms have on economics and culture? Have they had an impact on your country?
Multinational firms have a big impact on economies and culture because it connects the two concepts. Having multinational firms in different countries can increase consumption, investment. This can drive the GDP to increase making the economy for that country to be better than before. And since multinational firms are located in different country, they also have to cater their goods to the people that live in the local areas and the country and make the product attractive to the customers, therefore for example a wal-mart in china may be different from a wal-mart here in the states. This leads the economies and the markets to connect it to culture and makes the products more cultural related which can increase the demands for certain products. This article clearly shows the impact of Wal-Mart on China and did a great job of talking about the impact of multinationals firms having on economics and culture.
Work Cited
"How Walmart Is Changing China - Magazine - The Atlantic." The Atlantic — News and analysis on politics, business, culture, technology, national, international, and life – TheAtlantic.com. N.p., n.d. Web. 18 May 2012. <http://www.theatlantic.com/magazine/print/2011/12/how-walmart-is-changing-china/8709/>.
Wednesday, May 9, 2012
Economic Policy Weekly #2
China VP
defends economic policies to U.S business chiefs
Article
CAPTION
By Karen Bleier, AFP/Getty Images
A day after hearing from President Obama and other top administration officials that China must do more to level the playing field for U.S. businesses competing against Chinese firms, Xi made the case that China has already made significant strides in balancing trade policy. Earlier Wednesday, House Speaker John Boehner and Majority Leader Eric Cantor met with Xi and complained of "deficiencies" in China's enforcement of intellectual property laws.
In less than 10 years, U.S. exports to China have grown by 468% and China has become the fastest growing export market of the United States, Xi said. China's overall trade surplus has dropped from the pre-financial crisis level of over $300 billion to $150 billion. In 2011, China's trade surplus-to-GDP ratio dropped from over 7% to 2% and moved into the reasonable range by international standards. The yuan has also appreciated significantly in recent months.
"To be frank, it is very important for addressing China-United States trade imbalance that the United States adjusts its economic policies and structure, including removing various restrictions on exports to China, in particular, even control armed civilian high tech exports to China as soon as possible," Xi said in remarks before the U.S.-China Business Council. "This will help balance China-U.S. trade, stimulate economic growth and job creation in the United States and improve the balance of U.S. international payments."
Among the titans of industry in attendance were Muhtar Kent, CEO of Coca-Cola; Tom Donohue, president of the U.S. Chamber of Commerce; and Andrew Liveris, president of Dow Chemical.
U.S. business leaders complain that a full decade after China entered the World Trade Organization, Beijing continues to create unfair conditions through undervaluation of their currency, heavily subsidizing major industries, and placing restrains on exports of vital raw materials.
Obama has filed five WTO complaints against China since taking office.
Xi travels to Iowa today, and will make a stop in the Mississippi hamlet of Muscatine— a small town he visited during a 1985 visit to the United States. Iowa Gov. Terry Branstad will host a dinner in honor Xi in Des Moines tonight. Xi will take part in the U.S-China Agriculture Symposium on Thursday.
He travels to Los Angeles on Friday, where Vice President Biden will meet up with him.
Response:
Chinese
Vice President Xi Jinping states that “Washington and Beijing” should respect
each other. It was quite shocking that “Obama has filed five WTO complaints
against China since taking office.” It seems as if China and the US
relationship are not as great as it appears. One of the suggestions from China
is that in order to imbalance the trade we need to “adjust the economies policy
and structure, including removing various restrictions on exports to China, in
particular, even control armed civilian high tech exports to China as soon as
possible.” It is said to help balance the trade and create more jobs. This
article in particular seems to address an economic policy but did not discuss
the US response to the China’s proposal. This article also adds to the fact
that China is indeed growing quickly and that its currency is appreciating
making it more expensive for the US.
EGT Consulting Summary
EGT Consulting
Vehicle Market Executive Summary
The executive team at EGT Consulting needs a concise summary of the analysis of your motor vehicle market. The summary should present the most important elements of your paper in a clear and concise manner. The focus should be on the most compelling parts of your analysis. You will not need to include references since they are already available in your longer paper. You will need to use complete sentences and well-organized paragraphs.
In EGT Consulting, it will examine the market potential in three different markets including motor scooter, a mid-sized four-door sedan and a new luxury limousine in China. With many ways for transportation, these goods will be shipped in containers across to big port, for example in Shanghai or Nanjing. Taking a look at utility motor scooter market, the market will decrease due to the new law in some cities such as Guangzhou where scooters are banned. This will cause an increase in the new market for Cars. Although in 2008, the automobile industry is affected by the global economic crisis, recently the industry has been growing due to trying to develop green-energy technology. As for the limousine market, it only appeals to wealthy individual. This market will not be affordable to the majority of the population due to that the GDP per capita (PPP) is only $8,400. The potential growth for this market is not as good as the other two although we can argue that since China’s economy is growing so fast, in the future this can be the leading market.
Tuesday, May 8, 2012
Reinventing the Bazaar
Chapter Four of reinventing the Bazaar: A Natural History of Markets by John McMillan.
a) Choose a passage from the reading that you found particularly interesting. Why was it interesting?
One of the passages that I found to be interesting is the example on page 42-43 talking about overpricing. The example explains if you were to buy brass urn from different merchants at the price of 10 which one will you buy. You will receive a bargain if you compare the prices but this can only happen if you are given information. Although Buyers have a lack of information, the prices still is pretty high due to that sellers do not collude with each other to talk about the prices.
I found this part of the article to be interesting because it put an emphasis on the significance of information and how transferring information from one to another it can be helpful to the market.
b) What does the author mean by transactions cost? Give examples.
Transaction costs meant the cost of having others people involved in the market due to the lack of information. For example, in the article it talks about
“Intermediaries like wholesalers and trading company having to found their niche by serving to lower search costs.” In the Taiwan example on page 46 talks about how they operate as a match maker for shoe manufacturers and US and Europe. Although we have in between companies and people sometimes, “intermediaries are valuable.”
c) Simple economic models often assume perfect information (everyone knows everything, everywhere.) What effects arise from imperfect information? Who gains and who loses when information is unevenly distributed?
The effects that arise from imperfect information are that it leads to bad markets affecting both the merchant and the sellers. A lack of information can also causes price differences and a lack of communication between trades. I would say that both seller and buyer loses when information is unevenly distributed because buyers need information from seller to compare and sellers need information from other sellers in order to know how to set the prices so they can get an advantage with the buyers. In the article it states that “A market work works badly if information does not flow through it. IN labor markets especially, search costs shapes the markets’ performance. When a great many people are unable to find work, unemployment results.”
Thursday, May 3, 2012
A Fez of the Heart
Prologue to A Fez of the Heart: travels around Turkey in Search of a Hat.
1). Choose one passage from the reading that you found particularly interesting. Why was this interesting?
There a couple of passage that is interesting to me. But the most surprising one is that in the 1930’s “Turkish citizens were to be counted. Turkish citizens were first to find themselves a surname. After eighteen months, the warning went; those families that had failed to find themselves a surname to their liking would be fined and supplied with one of the district official’s choosing.”
This part interesting because it never occur to me how last names started or for what purpose. Since we are so modernized we sort of received our last name the day we are born. Last names are a very interesting topic because in different culture last names mean different things. For example in Hmong culture, last names are very important because we used last name to carry on the bloodline and the family name. It also is very important in that we are not allowed to marry the person with the same last name where as in Japanese culture, last names do not matter and anyone can marry anyone. But in Mexico or Costa Rica, people have not only their father’s name but also their mother as well which makes their last name longer.
2). Use examples from this reading to illustrate the interaction between economics and culture.
Within this article it points out that this group of people uses their culture as a way to gain capital and tourism. “By the late 1980’s, however, the sons of those same fisherman and farmers had discovered the value of the coins and sold them to the local museum. Exchanging old Nike for New, they spent their earnings shodding themselves in the latest athletic shoes and set about running hotels and restaurants where the menus offered fisherman’s mallet and farmer’s lamb.” This shows that the people promote their culture to tourist and because the currency was an apart of their culture people sold their old coins/money as a part of attracting tourist because new money was coming in. Another situation was the bikinis where it was banned. Muslims were deeply offended. “French visitors who had been largely brought up on nude sunbathing and doubtless thought slipping on a bikini for jaunt through town might label them as puritanical killjoys. As a result, several of them were stoned by incensed villagers.” This affected the economy due to that people were not allowed to wear bikini and were drove tourism down. In a huge part of society, tourism plays a part of the economy. But also culture as well due to that people are only allowing certain things to happen or banning certain activity can cause the increase or decrease in tourism.
3). For your study abroad country, identify the leading destinations for tourists. What draws people to those specific places?
China has been a leading destination for tourist because of the historical places such as the Great Wall of China, the Forbidden City, and many of the modern cities including Shanghai, Shenzhen, Beijing, and parts of Hong Kong as well. China has also have a huge population which spread Mandarin Chinese teaching abroad leading people/students to also want to go to china to study the language. China also has a thriving film industry which leads a lot of viewers to be interested in China. Stars/actors such as Jackie Chan and Jet Li play a huge part in introducing China as a country because of where they are from this cause people to be interested in Chinese culture. Martial arts has also play a big shift in films which changes how most films are made now a day involving actions and fighting.
Work Cited:
Prologue to A Fez of the Heart: travels around Turkey in Search of a Hat. Article
Wednesday, May 2, 2012
China Imports Article Weekly #1
China Imports
Article
http://www.chinadaily.com.cn/bizchina/2012-05/02/content_15184873.htm
China will work harder to bring in more imports as it strives to bring balance to its trade, according to guidelines issued by the State Council on Monday.
"The government will further improve the structure of imports and stabilize imports of bulkcommodities while importing more advanced technological equipment, important parts and rawmaterials and appropriately broadening its imports of consumer goods," according to theguidelines.
"More money for import promotion will be added to the present money set aside for developingforeign trade. And interest subsidies will be provided for government-encouraged imports whilethe coverage of the interest subsidies will be appropriately adjusted."
The guidelines also called for more support for imports from developing economies.
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Dong Dengxin, head of the securities research institute at Wuhan University of Science andTechnology, said the guidelines come as an important sign amid China's economic transition.
"The policy will help balance China's international trade in view of its great foreign exchangereserves and ease the rising price at home against the background of a high (consumer priceindex)," he said. "The measures will also drive down the prices of imports and give the Chinesea greater chance of enjoying imported commodities as the yuan appreciates."
The duties charged on some imports will also be adjusted. Tentative tax rates will be introducedto lower the import duties charged on some raw materials and commodities used in people'severyday lives, as well as to adjust the duties charged on imports of some advanced equipmentand components.
The goal will be to reduce the duties charged on primary raw materials and importantcomponents that are used in strategic emerging industries but that cannot be produced byChina, the document said.
"The important result of expanding imports of consumer commodities and other things is tobring more competition to domestic markets and provide more high-quality products forconsumers," said Wang Haifeng, director of international economics at the Institute forInternational Economic Research, a think tank under the National Development and ReformCommission.
Easier means of obtaining financing are being called for to encourage imports of advancedproducts and resources, as well as to broaden importers' means of obtaining finance.
China reported the value of its imports increased by 6.8 percent in the first quarter of the year, down 26 percent year-on-year. It also said the value of its exports increased by 7.6 percent inthe same period. That was the slowest rise seen since 1999 except for in 2009, when thefigures were distorted by the world financial crisis, according to the spring 2012 Report on theForeign Trade Situation of China, which was issued by the Ministry of Commerce on Friday.
Sluggish overseas demand and increasing domestic costs have taken a deceleration seen inChina's foreign trade in the fourth quarter of 2011 and extended it to the first quarter of 2012.The second quarter, meanwhile, will continue to see slow trade growth while the whole year isexpected to see slower but more balanced trade growth than 2011, according to the report.
"The slowdown in GDP growth is under control and expanding imports will not hurt GDP growth, which the government wants to see happen at a rate of 7.5 percent this year," Wang said. "That will drive the economic transition at home and lead to balanced trade."
For the country's 12th Five-Year Plan (2011-15), the ministry has set a goal of having tradegrow at an average rate of 10 percent a year. That's lower than the 15.9 percent in averageannual trade growth seen during the 11th Five-Year Plan (2006-10).
The lower target came in response, in part, to the global economic slowdown, tradeprotectionism, fluctuations in exchange rates and increasing costs, according to the 12th Five-Year Foreign Trade Guide issued on Thursday.
"China's move to expand imports will bring more market room for economies troubled byeconomic crises and reduce trade frictions," Wang said. "What's more important, it signalsChina's economic growth will continue and promote confidence in a global economic recovery."
Response:
China’s bringing in more imports from developing economies and other countries is a great idea since China’s current plan is that increasing imports can help balanced their exports. It is reported that “the value of its imports increased by 6.8 percent in the first quarter of the year, down 26 percent year-on-years. It also said the value of its exports increased by 7.6 percent in the same period.”
I also think that increasing imports will be beneficial in that China relies heavily on exports but if the economy of other countries goes into depression/collapse, this can affect China’s economy. In a short run, if this was to happen, China’s economy will also collapse as well if there is no one buying China’s goods (export).
As a result: the GDP of China
GDP ↓→ C↓ + I + G + Ex↓ - Im
Overall this article was interesting in that China has always been a exporting country and so for China to actually increase their imports is a surprising matter because China’s economy is growing so fast.
China’s bringing in more imports from developing economies and other countries is a great idea since China’s current plan is that increasing imports can help balanced their exports. It is reported that “the value of its imports increased by 6.8 percent in the first quarter of the year, down 26 percent year-on-years. It also said the value of its exports increased by 7.6 percent in the same period.”
I also think that increasing imports will be beneficial in that China relies heavily on exports but if the economy of other countries goes into depression/collapse, this can affect China’s economy. In a short run, if this was to happen, China’s economy will also collapse as well if there is no one buying China’s goods (export).
As a result: the GDP of China
GDP ↓→ C↓ + I + G + Ex↓ - Im
Overall this article was interesting in that China has always been a exporting country and so for China to actually increase their imports is a surprising matter because China’s economy is growing so fast.
Sunday, April 29, 2012
Pietra Rivoli’s book (Ch5-8) Part II
Review the Part II of Rivoli’s book (Ch5-8) before addressing the following questions.
1). What does the history of the location of the textile industry illustrate about global economies?
The histories of the locations play a huge part in the global economies because of the different locations, it allows trades. With each country at a different location, they each have their own economy and this link to exports and imports within that country. Examples of places with certain goods such as “by the mid-1930s Japan would have approximately 40 percent of the world’s export of cotton goods.” “By the 1970s, Hong Kong was the world’s largest exporter of clothing, with manufacturing base designs for the low end of the Western apparel markets.” The locations shape the global economies.
2). Industrialization brings both positive and negative consequences. How do you view these trade-offs. Use specific examples from the text to support your view.
Industrialization on positive consequences in that with globalization the world is able to trade with each other and have share the amount of goods. Although with the benefits of industrialization, migrant workers and people involved with the process have to live in poor conditions and work long hours to produce the goods. They also earn low amount of wages. Although there have been regulations and policies to help these workers, it is still not enough. An example of a policy is “in the US, the Occupational Safety and Health Administration was formed in 1970 and today is advising an analogous body that is developing in China.” I feel that one way to help these poorer countries is to also develop their environment and living area to a higher standard and in even if they are receiving lower wages at least they can live comfortably. This can also give the worker an incentive to want to work. This trade-off between both negative and positive consequences, overall I feel that they balanced each other out because without these workers there will be no goods and the economies will not so well off. This tradeoff is similar to what the author says, “As much as the CEOs would like to silence the activists and activists would like to silence the corporations, the fact is that the two sided need each other…” Both the negative and positive tradeoff needs each other in order for production to work.
3). Choose one passage from this section of book that you found particularly informative. Explain why it was interesting.
There are many passages that are interesting but one of the passages that I thought is informative and interesting is:
“Chi-Ying, a young single woman from Hubei, was interviewed by Lee. Though Chi-Ying makes seven to eight times as much money at the factory as her father does at home, money is not at the top of her list of reasons for leaving the village for the factory. Chi-Ying has delayed marriage and ultimately decided against the husband her parents had chosen for her. With her wages, she repaid the young man for the gifts he had given her parents. In the city, she feels modern,, free, and young. She likes buying a pair of cheap earrings with her own money, seeing a movie or visiting the shopping mall. Chi-Ying compares herself to her mother and grandmother, and the striking differences seem to her to not income but horizons. Mom and Grandma never had their own jobs, or their own money. They never saw a paved road.” (p. 113).
I found this passage interesting because we can be aware of china’s situation and look at a personal story of Chi-Ying. I feel that since the world is becoming globalized and changing, the different generation is experiencing different lives than their parent and the families are no longer living traditional lifestyles. Chi-Ying mentions both her mother and grandmother never had a job or money of their own, this makes her feel as if she had more opportunity and advantage growing up in the time era because she have freedom and could live in a world where she can buy cheap goods and enjoy her life. This passage can also make us think about other countries as well and how globalization shapes the lives of workers.
Works Cited
Rivoli, Pietra. The travels of a t-shirt in the global economy: an economist examines the markets, power and politics of world trade. Hoboken, N.J.: John Wiley & Sons, 2005. Print.
Wednesday, April 25, 2012
Richard Florida
The World is Spiky
http://creativeclass.com/rfcgdb/articles/other-2005-The%20World%20is%20Spiky.pdf
1). How does the author see globalization?
Richard Florida has positive views of globalization in that country such as London, New York, Paris, Tokyo, Hong Kong, Singapore, Chicago, Los Angeles, and San Francisco are strongly connected to one another even if they are far from each other. Globalization is effective if talented and creative people are able to combine ideas even if they are far from each other therefore, they tend to live closer to one another. Richard also talks about the backslash of globalization. For example the French voted no to suburban and rural headquarter. China and India are growing and developing in rural areas in which they are not suppose to and this create a problem when we see cluster of people in one area or “tribe”.
2). How does this relate to central place theory?
This article relates to the central place theory because of the clustering of the population in one area they often build connections with another area for business purposes. Trading and economic interactions are quite important especially for regional metropolis and national metropolis areas. The article states that there is a clustering of people in one specific area due to that “population density is of course a crude indicator of human and economic activity.” In map A we can clearly see the urban areas and see where most people lived.
3). For your foreign travel plans, locate your city within the hierarchy of central places. Provided examples of nearby places that would be lower or higher on the hierarchy.
Location: Beijing, China
Beijing is a national metropolis on the hierarchy of places due to its massive population and how much the city can offer when it comes to services and city size. Beijing is the second largest city by population. Beijing has 16 districts and a international airport. It is very developed and has a good economy. Beijing has a lot of historic sites, museums, and sightseeing places for tourism.
Nearby places for examples:
Small City: Ping Xiang: In Guangxi
It has a railway to Hanoi, Vietnam, 4 towns. It has about 100,000 people and is considered to be “country-level city.”
Regional city: Li Jiang, Yunnan
It has an airport and many transportations services to Kunming along with historical sites.
Regional metropolis: Hang Zhou
It has Jewish and Muslim communities, many districts and also a stabilized economy in textiles, agriculture and more.
Work Cited:
Found the information of examples on Wikipedia because it was difficult to find information about each of the location in China
Sunday, April 22, 2012
Transportation Industries
For your country, (China) research and briefly discuss each of the following items.
1). Water transportation
Closest major ocean ports (post panama capable)
Other ports
http://www.travelchinaguide.com/essential/water-transport.htm
- 2005: there are navigable inland waterways especially in the four provinces of Jiangsu, Guangdong, Hunan and Sichuan.
- The largest five waterways: Beijing-Hangzhou Grand Canal and the Qinhuai River; Yangtze River, Xijiang River as well as the Amur River (Heilongjiang) and Songhua River.
- 2006: There were over 150 coastal harbours and 23 major inland waterway ports like Zhangjiagang, Shenzhen, Zhanjiang, Dalian, Qinhuangdao, Tianjin, Yantai, Qingdao, Nanjing, Shanghai, Xiamen, Zhuhai, Huangpu and so on.
- “Shanghai (famous international shipping center) is the largest coastal harbor in China and the third-largest in the world, while Nanjing port, with the largest shipping capacity, is the largest among all the inland Chinese ports.”
http://en.wikipedia.org/wiki/Transport_in_China
- “China has more than 2,000 ports, 130 of which are open to foreign ships. The major ports, including river ports accessible by ocean-going ships, are Beihai,Dalian, Dandong, Fuzhou, Guangzhou, Haikou, Hankou, Huangpu, Jiujiang, Lianyungang, Nanjing, Nantong, Ningbo, Qingdao, Qinhuangdao, Rizhao, Sanya,Shanghai, Shantou, Shenzhen, Tianjin, Weihai, Wenzhou, Xiamen, Xingang, Yangzhou, Yantai, and Zhanjiang.”
- “2003: these inland waterways carried nearly 1.6 trillion tons of freight and 6.3 trillion passenger/kilometers to more than 5,100 inland ports”
2). Land transportation
Railroad freight
Railroad passenger
Hiway and road network
http://en.wikipedia.org/wiki/Transport_in_China
- Rail is the major mode of transport
- China has the world's second largest rail network
- “2003: China’s railways carried 2.2 trillion tons of freight and 478.9 trillion passenger/kilometers.”
- “Foreign capital investment in the freight sector was allowed beginning in 2003, and international public stock offerings opened in 2006. In another move to better capitalize and reform the rail system, the Ministry of Railways established three public shareholder-owned companies in 2003: China Railways Container Transport Company, China Railway Special Cargo Service Company, and China Railways Parcel Express Company.”
- “The high speed service is mainly operated by China Railway High-speed. Lines capable for 300+ km/h running include:”
- Beijing–Tianjin Line, 117 km long
- Wuhan–Guangzhou Line, 968 km long
- Zhengzhou–Xi'an Line, 457 km long
- Shanghai–Nanjing Line, 301 km long
- Shanghai–Hangzhou Line, 160 km long
- Currently there are 12 rapid transit systems in mainland China.
- “Beijing Subway, which opened in 1969, currently has 15 lines, 218 stations and 372 km of subway track and will grow to about 1,000 km by 2020.”
- “The Tianjin Metro was begun in 1970 as a planned network of 153.9 km on seven lines, the current existing system contains 2 lines and 26.18 km of track with 22 stations.”
- “Shanghai Metro, which opened in 1995, as of end of 2010 has twelve lines, 233 stations, and 420 km of track in operation, making it the longest metro system in the world. Further expansion plans call for a network of 887 km of track.”
- “The Guangzhou Metro, which opened in 1997 has five lines (as of 2010), 144 stations and has 236 km with an additional 400 km planned to be completed by 2020”
- “The Shenzhen Metro opened in 2004, initially with two lines, 19 stations, and 21.8 km of track, after 2010 it had over 70 km, by June 2011 it has expanded to 177 km of operational metro.”
- Network of roads: (China National Highways) and expressways (Expressways of China).
- 2005: “China had a total road network of more than 3.3 million km, although approximately 1.47 million km of this network are classified as "village roads"
- “The highway and road systems carried nearly 11.6 billion tons of freight and 769.6 trillion passenger/kilometers in 2003.”
- “Highways and motor vehicles, which carry 13.5% of cargo and 49.1% of passengers”
3). Air transportation
International airports
Other airports
http://www.prnewswire.com/news-releases/china-air-transport-and-airport-industry-report-2010-2011-124764858.html
- “China Southern Airlines, China Eastern Airlines and Air China International ranked top 3, with average monthly passenger traffic of 5,814,800, 4,926,500 and 4,350,700 and fleet scale of 422 aircrafts, 348 aircrafts and 393 aircrafts separately.”
- “China Southern Airlines: It has the most aircrafts and annual passenger traffic in China aviation industry. In 2010, its passenger traffic ranked first in Asia and third in the world.”
- “China Eastern Airlines: Coupled with the driving force of Shanghai World Expo, the transportation revenue gained by China Eastern Airlines in 2010 grew by 81.49% to RMB68.47 billion. However, in Q1 2011, the transportation revenue only grew by 16.63% year on year.”
- “Air China International: It has the most assets and traffic in China aviation industry. In 2010, it achieved net profit of RMB12.208 billion, up 142.75% year on year; in Q1 2011, it achieved net profit of RMB1.671 billion, down 23.04% year on year.”
- “The passenger throughput reached 564,312,000, up 16.1%, cargo and mail throughput was 11.29 million tons, up 19.4%”
- “Chinese airports are divided into three categories: first, three hub airports, including Beijing Capital International Airport, Shanghai Pudong Airport and Guangzhou Baiyun Airport; second, 17 major airports in Chengdu, Kunming, Xi'an, Urumqi, Wuhan and other cities; third, other types of airports.”
- “In 2010, the number of airports in China increased. The passenger throughput of three hub airports accounted for 27.6% of the total throughput, declining slightly. The passenger throughput of Beijing Capital International Airport accounted for the highest 13.1%, while Guangzhou Baiyun Airport 7.3 % and Shanghai Pudong Airport 7.2%.”
http://en.wikipedia.org/wiki/Transport_in_China
- “In 2007 China has 467 airports. Of China's major airports, Beijing Capital International Airport (PEK), located 27 km northeast of central Beijing, has the greatest flow of passengers annually.”
- “Other major airports are located at Chengdu, Chongqing, Dalian, Hangzhou, Harbin, Hohhot, Kunming, Qingdao, Shenyang, Tianjin, Urumqi, Xiamen, and Xi’an.”
Overall China is such a big country that its economy is growly quickly. With its hiway and road system, waterway, air transportation and ports, China can transport goods and passage easily. Also due to globalization, China has been able to ship things at a low price to different destinations and increase their exports to increase their GDP. It is an amazing how much airports and how much ports China have as a big country. I was shocked to find out that how many ways there is to transport goods. Until doing this research I also found that transportation is very important and a big part of the economy because distributing goods and trading is a part of the national income (GDP) and also it allows other countries to have goods that the other country have. For example most of our goods in the US are made in China or come from China and this allows us as customers to have the same or similar goods that Chinese people have in their country.
Work Cited:
1). Water transportation
Closest major ocean ports (post panama capable)
Other ports
http://www.travelchinaguide.com/essential/water-transport.htm
- 2005: there are navigable inland waterways especially in the four provinces of Jiangsu, Guangdong, Hunan and Sichuan.
- The largest five waterways: Beijing-Hangzhou Grand Canal and the Qinhuai River; Yangtze River, Xijiang River as well as the Amur River (Heilongjiang) and Songhua River.
- 2006: There were over 150 coastal harbours and 23 major inland waterway ports like Zhangjiagang, Shenzhen, Zhanjiang, Dalian, Qinhuangdao, Tianjin, Yantai, Qingdao, Nanjing, Shanghai, Xiamen, Zhuhai, Huangpu and so on.
- “Shanghai (famous international shipping center) is the largest coastal harbor in China and the third-largest in the world, while Nanjing port, with the largest shipping capacity, is the largest among all the inland Chinese ports.”
http://en.wikipedia.org/wiki/Transport_in_China
- “China has more than 2,000 ports, 130 of which are open to foreign ships. The major ports, including river ports accessible by ocean-going ships, are Beihai,Dalian, Dandong, Fuzhou, Guangzhou, Haikou, Hankou, Huangpu, Jiujiang, Lianyungang, Nanjing, Nantong, Ningbo, Qingdao, Qinhuangdao, Rizhao, Sanya,Shanghai, Shantou, Shenzhen, Tianjin, Weihai, Wenzhou, Xiamen, Xingang, Yangzhou, Yantai, and Zhanjiang.”
- “2003: these inland waterways carried nearly 1.6 trillion tons of freight and 6.3 trillion passenger/kilometers to more than 5,100 inland ports”
2). Land transportation
Railroad freight
Railroad passenger
Hiway and road network
http://en.wikipedia.org/wiki/Transport_in_China
- Rail is the major mode of transport
- China has the world's second largest rail network
- “2003: China’s railways carried 2.2 trillion tons of freight and 478.9 trillion passenger/kilometers.”
- “Foreign capital investment in the freight sector was allowed beginning in 2003, and international public stock offerings opened in 2006. In another move to better capitalize and reform the rail system, the Ministry of Railways established three public shareholder-owned companies in 2003: China Railways Container Transport Company, China Railway Special Cargo Service Company, and China Railways Parcel Express Company.”
- “The high speed service is mainly operated by China Railway High-speed. Lines capable for 300+ km/h running include:”
- Beijing–Tianjin Line, 117 km long
- Wuhan–Guangzhou Line, 968 km long
- Zhengzhou–Xi'an Line, 457 km long
- Shanghai–Nanjing Line, 301 km long
- Shanghai–Hangzhou Line, 160 km long
- Currently there are 12 rapid transit systems in mainland China.
- “Beijing Subway, which opened in 1969, currently has 15 lines, 218 stations and 372 km of subway track and will grow to about 1,000 km by 2020.”
- “The Tianjin Metro was begun in 1970 as a planned network of 153.9 km on seven lines, the current existing system contains 2 lines and 26.18 km of track with 22 stations.”
- “Shanghai Metro, which opened in 1995, as of end of 2010 has twelve lines, 233 stations, and 420 km of track in operation, making it the longest metro system in the world. Further expansion plans call for a network of 887 km of track.”
- “The Guangzhou Metro, which opened in 1997 has five lines (as of 2010), 144 stations and has 236 km with an additional 400 km planned to be completed by 2020”
- “The Shenzhen Metro opened in 2004, initially with two lines, 19 stations, and 21.8 km of track, after 2010 it had over 70 km, by June 2011 it has expanded to 177 km of operational metro.”
- Network of roads: (China National Highways) and expressways (Expressways of China).
- 2005: “China had a total road network of more than 3.3 million km, although approximately 1.47 million km of this network are classified as "village roads"
- “The highway and road systems carried nearly 11.6 billion tons of freight and 769.6 trillion passenger/kilometers in 2003.”
- “Highways and motor vehicles, which carry 13.5% of cargo and 49.1% of passengers”
3). Air transportation
International airports
Other airports
http://www.prnewswire.com/news-releases/china-air-transport-and-airport-industry-report-2010-2011-124764858.html
- “China Southern Airlines, China Eastern Airlines and Air China International ranked top 3, with average monthly passenger traffic of 5,814,800, 4,926,500 and 4,350,700 and fleet scale of 422 aircrafts, 348 aircrafts and 393 aircrafts separately.”
- “China Southern Airlines: It has the most aircrafts and annual passenger traffic in China aviation industry. In 2010, its passenger traffic ranked first in Asia and third in the world.”
- “China Eastern Airlines: Coupled with the driving force of Shanghai World Expo, the transportation revenue gained by China Eastern Airlines in 2010 grew by 81.49% to RMB68.47 billion. However, in Q1 2011, the transportation revenue only grew by 16.63% year on year.”
- “Air China International: It has the most assets and traffic in China aviation industry. In 2010, it achieved net profit of RMB12.208 billion, up 142.75% year on year; in Q1 2011, it achieved net profit of RMB1.671 billion, down 23.04% year on year.”
- “The passenger throughput reached 564,312,000, up 16.1%, cargo and mail throughput was 11.29 million tons, up 19.4%”
- “Chinese airports are divided into three categories: first, three hub airports, including Beijing Capital International Airport, Shanghai Pudong Airport and Guangzhou Baiyun Airport; second, 17 major airports in Chengdu, Kunming, Xi'an, Urumqi, Wuhan and other cities; third, other types of airports.”
- “In 2010, the number of airports in China increased. The passenger throughput of three hub airports accounted for 27.6% of the total throughput, declining slightly. The passenger throughput of Beijing Capital International Airport accounted for the highest 13.1%, while Guangzhou Baiyun Airport 7.3 % and Shanghai Pudong Airport 7.2%.”
http://en.wikipedia.org/wiki/Transport_in_China
- “In 2007 China has 467 airports. Of China's major airports, Beijing Capital International Airport (PEK), located 27 km northeast of central Beijing, has the greatest flow of passengers annually.”
- “Other major airports are located at Chengdu, Chongqing, Dalian, Hangzhou, Harbin, Hohhot, Kunming, Qingdao, Shenyang, Tianjin, Urumqi, Xiamen, and Xi’an.”
Overall China is such a big country that its economy is growly quickly. With its hiway and road system, waterway, air transportation and ports, China can transport goods and passage easily. Also due to globalization, China has been able to ship things at a low price to different destinations and increase their exports to increase their GDP. It is an amazing how much airports and how much ports China have as a big country. I was shocked to find out that how many ways there is to transport goods. Until doing this research I also found that transportation is very important and a big part of the economy because distributing goods and trading is a part of the national income (GDP) and also it allows other countries to have goods that the other country have. For example most of our goods in the US are made in China or come from China and this allows us as customers to have the same or similar goods that Chinese people have in their country.
Work Cited:
http://en.wikipedia.org/wiki/Transport_in_China
http://www.prnewswire.com/news-releases/china-air-transport-and-airport-industry-report-2010-2011-124764858.html
http://www.prnewswire.com/news-releases/china-air-transport-and-airport-industry-report-2010-2011-124764858.html
Thursday, April 19, 2012
Marc Levinson
Chapter One of the Box: How the Shipping Container Made the World Smaller and the World Economy Bigger by Marc Levinson,
Available online at http://press.princeton.edu/chapters/s9383.html
1). Identify a selection from this chapter that you found particularly interesting and explain why you selected it.
Marc Levinson’s article is very interesting in that it made me think about how transporting good can affect the economy. I never really pay attention to where we get certain products and how did a product travel half way across the country. I thought that transporting goods is interesting in that “A 35-ton container of coffeemakers can leave a factory in Malaysia, loaded aboard a ship, and cover the 9000 miles to LA in 16 days.” This made me think about how the world has change so much over time and how globalized the world have become. Trades has always been a fascinating topic for me because imports and exports are interesting to see where and how much of a product is and how everyone can have the product even though it is not from the same place they lived in. Another thing that I found to be interesting is that when products and goods are loaded onto a large truck, it get shipped to its next destination not allowing anyone to see or touch the goods and this is interesting because “containers can be just as efficient for smuggling undeclared merchandise, illegal drugs, undocumented immigrants and terrorist bombs as for moving legitimate cargo” and no one will know. This makes me wonder if the black markets also work this way when it comes to shipping their goods.
2). How does the author see the development of the shipping container contributing to globalization?
The development of the shipping container contributes to globalization because they allow the world to trade goods shipping from one country to another easily. These containers also save time and is quickly handled. “The containers are at the core of highly automated system for moving goods from anywhere, to anywhere, with a minimum of cost and complication on the way.” The containers allow consumers from different country to have access to the goods and this makes the world more globalized.
3).What short run impact did this innovation have on national income and employment? What would the long-run impact be? Explain.
GDP ↑ = C + I + G + NX↑
In a long run impact, there will be a little increase in resources because of the amount of good flowing into the country. However, the shipping containers do not really impact labor or natural resources. Although in capital, it will increase money supply and help the economy in a long run.
Work Cited
Levinson, Marc. "The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger." Princeton University Press. N.p., n.d. Web. 19 Apr. 2012. <press.princeton.edu/chapters/s9383.html>.
Available online at http://press.princeton.edu/chapters/s9383.html
1). Identify a selection from this chapter that you found particularly interesting and explain why you selected it.
Marc Levinson’s article is very interesting in that it made me think about how transporting good can affect the economy. I never really pay attention to where we get certain products and how did a product travel half way across the country. I thought that transporting goods is interesting in that “A 35-ton container of coffeemakers can leave a factory in Malaysia, loaded aboard a ship, and cover the 9000 miles to LA in 16 days.” This made me think about how the world has change so much over time and how globalized the world have become. Trades has always been a fascinating topic for me because imports and exports are interesting to see where and how much of a product is and how everyone can have the product even though it is not from the same place they lived in. Another thing that I found to be interesting is that when products and goods are loaded onto a large truck, it get shipped to its next destination not allowing anyone to see or touch the goods and this is interesting because “containers can be just as efficient for smuggling undeclared merchandise, illegal drugs, undocumented immigrants and terrorist bombs as for moving legitimate cargo” and no one will know. This makes me wonder if the black markets also work this way when it comes to shipping their goods.
2). How does the author see the development of the shipping container contributing to globalization?
The development of the shipping container contributes to globalization because they allow the world to trade goods shipping from one country to another easily. These containers also save time and is quickly handled. “The containers are at the core of highly automated system for moving goods from anywhere, to anywhere, with a minimum of cost and complication on the way.” The containers allow consumers from different country to have access to the goods and this makes the world more globalized.
3).What short run impact did this innovation have on national income and employment? What would the long-run impact be? Explain.
In a short run impact, it can increase the GDP because
if net export increase then it will cause the consumption, investment and government
to also increase. On the supply and demand graph it will affect the supply line
causing an increase in supply shifting the curve to right. This will cause a
decrease in prices and increase in quantities.
GDP ↑ = C + I + G + NX↑
In a long run impact, there will be a little increase in resources because of the amount of good flowing into the country. However, the shipping containers do not really impact labor or natural resources. Although in capital, it will increase money supply and help the economy in a long run.
Work Cited
Levinson, Marc. "The Box: How the Shipping Container Made the World Smaller and the World Economy Bigger." Princeton University Press. N.p., n.d. Web. 19 Apr. 2012. <press.princeton.edu/chapters/s9383.html>.
Thursday, April 12, 2012
Pietra Rivoli Book
The Travels of a T-shirt in the Global Economy
Pirtra Rivoli
Chapter 1-4
1.) How do the markets Rivoli discusses differ from an idealized, pure market theory?
The market that Rivoli discusses in chapter 4 is quite different from the pure market theory in that the ways how farmers sold their cotton was a simple test of grabbing a handful of cotton. The buyer sets a price and the seller agree because they did not want to risk it incase no one buys it. They did it for survival and the urge to provide for their families. There wasn’t any legal system at first but after a while a system was develop and it made it easier for farmers to sell their cotton through PCCA’s marketing pool which worked quite well for farmers.
2.) Choose one specific example of culture interacting with economics from these chapters.
Cultures definitely interact with economies in ways that cultures play a role in the production of goods and services. One example the book talks about is the comparison between different country and their way of producing cotton. Competition was mention in that China and India could have been a head in this market but because of the lack of education and technology, the United States was producing so much more. Another comparison was to West Africa and how US produced 400 times more than Africa. (p. 62).
3.) What surprises you in this section of the book?
This book overall, has been really interesting to read. There are many shocking things within the first four chapters. I have never really thought about where t-shirts came from or about the cotton industry. Most of the facts in the book were surprising to me because when we think of markets we tend to think of the end products (results), and the sales but never the process of how a good is made, produced and shipped. This book definitely opens my eyes and made me more interest in economics. One interesting thing how the cotton industry is a very important industry but we never really think about it after the end of slavery and plantations. The cotton industry not only contributed to making t-shirts, clothing but also to chips making industry and many more products such as toothbrushes, ball point pen, hotdogs, and much more. (p. 54).
Work Cited
Rivoli, Pietra. The travels of a t-shirt in the global economy: an economist examines the markets, power and politics of world trade. Hoboken, N.J.: John Wiley & Sons, 2005. Print.
Monday, April 9, 2012
China: Inflation
China: Economic Issue Inflation
For your country, find a recent news article discussing an economic problem or issue.
1) Summarize the issue. Include a link.
http://www.nytimes.com/2012/04/10/business/global/food-prices-push-rate-of-inflation-up-in-china.html?_r=1
- One of the main problems in china is inflation due to the prices of food.
- Inflation increases as the costs for raw materials rises.
- Mainly is a problem to Chinese family because it is where most of their household income money goes towards.
- Prices increase due to the weather conditions.
- Spring onion and cabbage are one example in which the prices has increase.
2) Relate the issue to one or more of the economic concepts we have discussed in class.
The main issue involves inflation. One of the graphs that can show this issue is to look at the supply curve. This will affect the supply curve and shift it to the right. As a result it causes the food prices to increase and a decrease in quantity.
3) Can you suggest a resolution to this problem? Are there policies that could improve the situation?
Beijing policy makers are still currently coming up with policies. I think a resolution to this problem is to wait it out because due to the weather, it’s hard for the agriculture sector to produce enough goods. Inflation is not necessary bad for the economy. Although one of the things I was thinking about was coming up with different substitute for specific food items to help customers to be able to afford food.
Work Cited
WASSENER, BETTINA. "Food Prices Push Rate of Inflation Up in China - NYTimes.com." NY Times Advertisement. N.p., n.d. Web. 9 Apr. 2012. <http://www.nytimes.com/2012/04/10/business/global/food-prices-push-rate-of-inflation-up-in-china.html?_r=2>.
Thursday, April 5, 2012
Milton Friedman
Milton Friedman
The Social Responsibility of Business is to Increase its profits
http://www.colorado.edu/studentgroups/libertarians/issues/friedman-soc-resp-business.html
1) Identify Friedman’s major themes and key points
- Friedman talks about the concept of social responsibility which basically is that people would leave their jobs to “join their country’s armed forces
- Corporate executive being in charge of the business and take responsibilities for making as much profits as there can be
- Although if the corporate executive decides to take up social responsibilities, “he is acting as a principal, not an agent; he is spending his own money or time or energy, not the money of his employers or the time or energy he has contracted to devote to their purposes. If these are "social responsibilities," they are the social responsibilities of individuals, not of business.”
- Raise of political questions such as principle and consequences
- Principle: taxes are imposed so far as possible in accordance with the preferences and desires of the public
- Consequences: A person cannot get away from the problem and that there is a line drawn from what is fair and what belongs to who.
- Unanimity: “ideal free market resting on private property, no individual can coerce any other, all cooperation is voluntary, all parties to such cooperation benefit or they need not participate. No values, no "social" responsibilities in any sense other than the shared values and responsibilities of individuals. Society is a collection of individuals and of the various groups they voluntarily form.”
- Conformity: “individual must serve a more general social interest–whether that be determined by a church or a dictator or a majority. The individual may have a vote and say in what is to be done, but if he is overruled, he must conform. It is appropriate for some to require others to contribute to a general social purpose whether they wish to or not.”
- Social responsibility: “it forces people to be responsible for their own actions and makes it difficult for them to "exploit" other people for either selfish or unselfish purposes. They can do good–but only at their own expense.”
2) What cultural values are most important to Friedman?
Cultural values that are important are they can be linked to social responsibility. For example, a person who wants to open a hospital would do so, just because he wants to serve the people rather than earn profits. Friedman thinks that the most important cultural values would be in between individualism and collectivism because people view social responsibility differently in that business man. Business man thinks that “ they are defending free enterprise when they declaim that business is not concerned "merely" with profit but also with promoting desirable "social" ends; that business has a "social conscience" and takes seriously its responsibilities for providing employment, eliminating discrimination, avoiding pollution and whatever else may be the catchwords of the contemporary crop of reformers.” Friedman feels that a corporate execute job mainly is to benefit for its business but if the corporate execute decides to follow their own interest and do something independently then this might affect the economy and the company.
3) Do you personally see a conflict between business and social responsibility?
Yes, I personally see a conflict in between business and social responsibility because social responsibility is often related to self interest therefore it does not benefit the economy as much as someone who is willingly to contribute to the society by accepting any job offers, where as business is not about who doing what job and are people happy with their jobs but is the labor force being productive and is goods being made and sold. Social responsibility is about contributing and giving to the community but business and about earning as much profits and it’s hard to do business if social responsibility is involved.
Work Cited
WASSENER, BETTINA. "Food Prices Push Rate of Inflation Up in China - NYTimes.com." NY Times Advertisement. N.p., n.d. Web. 5 Apr. 2012. <http://www.nytimes.com/2012/04/10/business/global/food-prices-push-rate-of-inflation-up-in-china.html?_r=2>.
Tuesday, April 3, 2012
Richard Shweder's Talk
Richard Shweder's talk on 4-2-2012
1)
Identify Richard Shweder’s major themes and key
points?
-
Shweder started out talking about robust
cultural pluralism and the three prophecies that shaped society.
-
Prophecies 1: view of globalization (Francis)
-
“Witnessing the end of history, the end point of
man kind ideological evolution, the universalization of western democracy as
the final form of human government” (new world replacing old world)
-
Civilization project: universal ideal
civilization
-
US
everyone is hyphenated, American way of life should be universalize because US
is the Best and is the only civilization
-
David miller (left) talking about people
attachment to their own community
-
“Nation stretch backward and their origins are
lost, various event have occur…community of obligation, we are born into it
have a obligation.”
-
Roger (philosopher of right) “since
enlightenment it is normal for European to think of society as a contract,
implies that social membership is free choice and 2nd all member of
society is currently living, care of the dead and unborn goes hand in hand.”
-
Prophecies 2:free trade and globalization
-
Ex: trade where people lived in different lands
and made goods that the other island liked. Meeting at the borders and have the
goods go? No one questions about how the good is made?
-
Eventually leading into investment and legal
systems
-
Civic Jewish community came to US after WW2,
settle in Brooklyn, (Jo L), reproducing life in 18 century Hungary in New York,
created school system lead to issues of violation of separation of church and
state
-
Prophecies 3: people in course of human history
the modern nation state is more likely to be an acceptation
-
People lived in empire, return to a global
empire, have better features of ottoman empire
-
Ex: 22 different people, weak central state
collected taxes and prevent others from getting into other’s territory. Given
local control.
-
Was no standard family life
-
Jews: kick out of Spain and Portugal in 1492
found empire welcoming, protected and given local control
-
World system: pushing toward a cosmetician elite,
run world system come from different backgrounds. Allow local control. Have
exit visa.
2)
What kinds of indicators would help you to
predict the direction of global change?
-
Equality versus diversity where one country can
never have both because it will be like a utopian idea
-
Modern technology: TV cellphone brought into
India (Hindu national movement started because of TV)
-
Civilization project: critiquing that we remove barbaric
society and moving toward universal ideal civilization
3)
How important is culture in shaping economic
outcomes? Give some specific examples.
-
Culture is important in that it can create a
society of people to have a common way of living
-
Ex: 18th century Hungary life in New
York
-
Richard’s example was the story of trade in
prophecies 2
Different culture can trade with each other
without questioning where the goods came from
-
Thomas McCally: education system turning Indians
into Englishman
Sunday, April 1, 2012
Resources. Trade and National Income
China
Resources:
China has natural resources such as
Coal, iron ore, petroleum, natural gas, mercury, tin, tungsten, antimony, manganese, molybdenum, vanadium, magnetite, aluminum, lead, zinc, uranium, hydropower potential (world's largest).
Labor force: 815.3 million (2010 est.)
International trade:
China’s exports partners includes:
US 17.7%, Hong Kong 14.1%, Japan 7.8%, South Korea 4.4%, Germany 4% (2011 est.)
Exports:
$1.898 trillion (2011 est.)
country comparison to the world: 1
$1.578 trillion (2010 est.)
Exports - commodities:
electrical and other machinery, including data processing equipment, apparel, textiles, iron and steel, optical and medical equipment
China’s Imports partner includes:
Japan 11.2%, South Korea 9.3%, US 7%, Germany 5.3%, Australia 4.7% (2011 est.)
Imports:
$1.743 trillion (2011 est.)
country comparison to the world: 3
$1.327 trillion (2010 est.)
Imports - commodities:
electrical and other machinery, oil and mineral fuels, optical and medical equipment, metal ores, plastics, organic chemicals
Reserves of foreign exchange and gold:
$3.236 trillion (31 December 2011 est.)
country comparison to the world: 1
$2.895 trillion (31 December 2010 est.)
Exchange Rate
As we look at the graph we can see that Chinese yuan to 1 US dollar is unstable. Currently it is about 6.29 yuan to 1 USD.
National Income Accounts
Investment (gross fixed)
54.2% of GDP (2011 est.
Country comparison to the world: 2
Governmental expenditures as % GDP: 22.0
Work Cited
"World Factbook." Central Intelligence Agency. N.p., n.d. Web. 1 Apr. 2012. <https://www.cia.gov/library/publications/the-world-factbook/geos/ch.html>.
Wednesday, March 28, 2012
China stats
China
Recent statistics of each of the following economic measures
GDP
$6.989 trillion
GDP per capita
$8,400 (2011 est.)
Life expectancy
Poverty rate:
13.4%
Literacy rate:
Unemployment rate
6.5% (2011)
Inflation
Inflation rate (consumer prices):
5.4% (2011 est.)
country comparison to the world: 132
3.3% (2010 est.)
Work Cited
"World Factbook." Central Intelligence Agency. N.p., n.d. Web. 3 Apr. 2012. <https://www.cia.gov/library/publications/the-world-factbook/geos/ch.html>.
Recent statistics of each of the following economic measures
GDP
$6.989 trillion
GDP per capita
$8,400 (2011 est.)
Life expectancy
total population: 74.84 years
country comparison to the world: 95
male:
72.82 years
female:
77.11 years (2012 est.)
| |
Poverty rate:
13.4%
Literacy rate:
|
|
definition: age 15 and over can read and write
total population:
92.2%
male:
96%
female:
88.5% (2008)
| |
Unemployment rate
6.5% (2011)
Inflation
Inflation rate (consumer prices):
5.4% (2011 est.)
country comparison to the world: 132
3.3% (2010 est.)
Work Cited
"World Factbook." Central Intelligence Agency. N.p., n.d. Web. 3 Apr. 2012. <https://www.cia.gov/library/publications/the-world-factbook/geos/ch.html>.
Tuesday, March 27, 2012
Jared Diamond
Why Did Human History Unfold Differently On Different Continents For the Last 13000 Years? By Jared Diamond
http://www.edge.org/3rd_culture/diamond/diamond_p2.html
Major themes and key points
Jared Diamond talks about the beginning of human kind. He first begins discussing the issues of racism and how people of different skin color used this concept to degrade each other and to use it as an excuse simply because there are no other reasons. Diamond shifts into the history of different countries and specially talks about Africa and Australia. Jared also talks about animals having to live in a certain area because it cannot spread to other areas, because it cannot adapt easily to another region. For example, turkey never was able to spread into Mexico.
What does he identify as the most important determinants to a society’s success?
The most important determinants to a society’s success is to become a well developed country having guns, ships, steel and ect. “The proximate factors were the same familiar ones of guns, steel, oceangoing ships, political organization, and writing. But again, we can ask why guns and ships and so on ended up being developed in Europe rather than in sub-Saharan Africa.” Jared states that developed country have the advantage to overthrow another country and this is why being advance in technology and possessing goods can help benefit one own country. For example how the Europeans overthrow the Native Americans was because the Native Americans lack supplies and weapons. “The resulting advantages of Europeans in guns, ships, political organization, and writing permitted Europeans to colonize Africa, rather than Africans to colonize Europe.”
How can these ideas be applied to today’s global economy?
These ideas can be applied to today’s global economy by first understanding that history plays an important part in shaping one own society. When we look at an individual country, we can determine if the country is successful or if they have a high GDP, base on how modern the society is. Technology places an important role in advancing the countries and allowing the country to produce more, increasing the goods and services and contributing to having a higher GDP. The economy is mostly relied on consumption, investment, government spending and export/imports, which meant that in order for a country to become successful, they must have goods such as well-built ship, guns, and steel. Along with goods, the country must also have intellectuals or people who specialized in making these advanced goods having the government invest into education and spending money on the supplies to build the goods. This will then increase the country’s GDP and allow the country to have power.
Work Cited
"Edge: Jared Diamond Talk [page 2]."Edge : Conversations on the edge of human knowledge. N.p., n.d. Web. 19 Apr. 2012. <http://www.edge.org/3rd_culture/diamond/diamond_p2.html>
http://www.edge.org/3rd_culture/diamond/diamond_p2.html
Major themes and key points
Jared Diamond talks about the beginning of human kind. He first begins discussing the issues of racism and how people of different skin color used this concept to degrade each other and to use it as an excuse simply because there are no other reasons. Diamond shifts into the history of different countries and specially talks about Africa and Australia. Jared also talks about animals having to live in a certain area because it cannot spread to other areas, because it cannot adapt easily to another region. For example, turkey never was able to spread into Mexico.
What does he identify as the most important determinants to a society’s success?
The most important determinants to a society’s success is to become a well developed country having guns, ships, steel and ect. “The proximate factors were the same familiar ones of guns, steel, oceangoing ships, political organization, and writing. But again, we can ask why guns and ships and so on ended up being developed in Europe rather than in sub-Saharan Africa.” Jared states that developed country have the advantage to overthrow another country and this is why being advance in technology and possessing goods can help benefit one own country. For example how the Europeans overthrow the Native Americans was because the Native Americans lack supplies and weapons. “The resulting advantages of Europeans in guns, ships, political organization, and writing permitted Europeans to colonize Africa, rather than Africans to colonize Europe.”
How can these ideas be applied to today’s global economy?
These ideas can be applied to today’s global economy by first understanding that history plays an important part in shaping one own society. When we look at an individual country, we can determine if the country is successful or if they have a high GDP, base on how modern the society is. Technology places an important role in advancing the countries and allowing the country to produce more, increasing the goods and services and contributing to having a higher GDP. The economy is mostly relied on consumption, investment, government spending and export/imports, which meant that in order for a country to become successful, they must have goods such as well-built ship, guns, and steel. Along with goods, the country must also have intellectuals or people who specialized in making these advanced goods having the government invest into education and spending money on the supplies to build the goods. This will then increase the country’s GDP and allow the country to have power.
Work Cited
"Edge: Jared Diamond Talk [page 2]."Edge : Conversations on the edge of human knowledge. N.p., n.d. Web. 19 Apr. 2012. <http://www.edge.org/3rd_culture/diamond/diamond_p2.html>
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