Benefits and costs of foreign direct Investment

Benefits and costs of foreign direct Investment Foreign direct investment (FDI) according to Hill(2007) takes place when a firm invests directly in facilities to produce and/or market a product in a foreign country. The facilities could include resources such as the factors of production; land, labour and capital. It could be said today’s major players in business seek not only to expand their territories in their home market but also have through FDI sought effective ways of improving existing products and breaking into new foreign markets. For example the import tariffs in China make it very challenging for other countries to serve the Chinese market through exports. Hill (2007). Via the use of FDI strategies foreign organisations are able to access pool of economic possibilities. Through the assessment of various sources the essay is going to critically assess the impacts of foreign direct investment (FDI) on a host country. It will critically discuss the benefits and disadvantages FDI has on the growth of a country. Ac cording to Gorg and Greenway (2004) foreign direct investment is a key driver of economic growth and development. FDI assists in the economic progression of the country where the investment is being made. According to Mencinger (2003), a vast number of countries through various ways desperately seek to attract as much foreign direct investment as probable in the hope of advancing their economic growth. The economic growth could be advanced in that FDI leads to the creation of factors such as jobs and more investment into the economy. However it could be argued that the efficient adoption of FDI is most effective under certain conditions. For instance FDI contributes to economic growth only when a sufficient absorptive capability of the advanced technologies is available in the host country. Borensztein, Gregorio and Lee (1998). FDI strategy is more successful if it is carried out in economically developing countries. Developing host countries compared to developed countries are usua lly more keen to attract foreign investments in order to reap the benefits that come with it and this usually reflected in the legislation of one’s country. One could find that a business is more willing to first invest in a developing country as the legislation is more lenient compared to the first world countries. However it is important to note that this does not apply to all countries. China for example has a highly regulated environment, which can prove to be difficult when it comes to carrying out business transactions, and shifting tax and regulatory regimes. Hill(2007). It could be said that when making legislation those in power should regard the relative impact of the laws passed on potential FDI. On the other hand one could argue that more countries are becoming more aware of the importance of creating more favourable conditions for FDI. Gorg and Greenway in their report state that in 1998 legislation changes made by 60 countries, more than 90 percent of those chan ges created a more positive environment for FDI. FDI if managed efficiently should aid to the hosts county’s economic development. â€Å"FDI inflows have been a major source of investment and economic growth in China†¦accounting for perhaps as much as 30 percent of the county’s growth.†(Hill, page 242, 2007). The mixture of cheap labour and tax incentives usually found in developing countries make an attractive base for foreign investors. The new economic investment brought in by foreign businesses will help in increasing the host country’s national income, at the same time bringing other economic benefits known as spillovers that will result in the increase of productivity within the country. Gorg states that, â€Å"†¦theoretical literature identifies four channels through which spillovers might boost productivity in the host country: imitation, skills acquisition, competition and exports.† These channels if recognised and implemented pr operly could lead to the increase of the host country’s productivity and economic growth. Through the imitation of foreign goods, services and processes the host country can increasing improve its processes, facilities and the way business is contacted in its own business environment. One of the worries for many foreign investors when wanting to invest in developing countries is that the host country will not have the facilities ( for example the equipment or the right business structure for the manufacturing and deploying of products) they need in order for business affairs to run smoothly. Through the imitation of the way foreign organisations handle their business affairs, host countries can improve their processes and facilities, arguably to the extent that they will make their country enticing to FDI. Imitation of products will improve the quality and range of products of the local organisations, making them competitive an appealing to customers. The increase of the prod uctivity of more high quality products could lead to the attraction of not only local customers but global customers and this could also lead to more FDI in the host country.

Secularism as an Emerging Social Movement Essay Example | Topics and Well Written Essays - 750 words

Secularism as an Emerging Social Movement - Essay Example Secularization is not a result of widening gap between the church and the state, but a slow change in the outlook of a culture that sees and perceives the established religion in a different way. Is Secularism a New Trend and a Social Phenomenon? The concept of secularism has remained a historical phenomenon in the American mainstream of personal and social life since many hundred years. Above all, it has remained homogenous or even anomalous within the American way of life. However, the secular way of thinking was really kept confined out of emerging political forums for at least a century. In fact, equilibrium was maintained in two diverging viewpoints, one that laid full belief in the tenets of Christianity, and the other that veered a bit away from practice of religion in political and public life. Article 6, Section 3 declares that "No religious test shall ever be required as a qualification to any office or public trust under the United States;' and the First Amendment guarantees that "Congress shall make no law respecting an establishment of religion." (Kellman, 2004) Is Secularism an American way of life? It is very difficult to answer as this phenomenon is regulated to a certain section of people and their beliefs. However religion is increasingly being perceived as one of the major factor in, how you look at the state of the nation in today’s turbulent times. There is a distinct possibility of a large number of people relating the concepts of secularism vis-Ã  -vis religion, to the existing political scenarios and emerging world politics.

Deep analysis Research Paper Example | Topics and Well Written Essays - 1000 words

Deep analysis - Research Paper Example The reverse is also true; meaning when the market demand slackens there will be a decline in capacity utilization. In the economic scene, capacity utilization is employed to track inflation pressures (Nelson 275). In United States, data on capacity utilization is released on monthly bases by the Federal Reserve Board. This helps in tracking the extent to which the country’s productive capacity is being utilized and also forecast likely growth or decline in various sectors. Capacity utilization is measured by deducting actual production from potential production. Capacity Utilization=Real actual output-Real potential Output The data released by the Federal Reserve Bank can be plotted in a graph to show historical developments in capacity utilization. Notably, capacity utilization is represented in percentages, 100% is considered a maximum level of production. Such a graph is represented in the next part; the data represented is from 1965 through to 2012 (Federal Bureau of Reser ve). Capacity Utilization in United States of America Year Question 3 One of the emergent findings is that the overall capacity utilization has declined over the years. In the 1960s capacity utilization averaged around 85 percent. ... In explaining whether these findings are to be expected it would be important to look at the general economic environment over the years. It is clear that in the 1960s, which was largely a postwar period, there was a massive growth in the economy. This massive growth was enabled by a growing demand for goods and services which prompted companies in various industries to increase their productive capacity. At the same time, companies sought to maximize on their productive capacity to meet the demand. The result was higher levels of capacity utilization. However, this scenario would falter with a general change in the economic environment. This is because the economic environment remains a major determinant of the levels of production. In times of great demand the production levels will rise and thence the capacity utilization of existent companies will also rise. Therefore, at times of slow economic growth, or recession in that case, the industries are performing below par and thence the capacity utilization is way below that of a thriving economy. Given this scenario, it is thus expected that the level of capacity utilization will falter every time there is a marked decline in economic growth. Looking at the plotted levels and matching this with the overall health of the economy, we are able to see a higher level in the 1960s. It is during this period that the United States experienced the longest period of uninterrupted period of economic expansion. At the time, the efficiency and production levels of the U.S improved markedly. However, these levels have since declined and the country hardly goes for two decades without a recession. This reality largely suggests that the findings would be

The Future of India's Economy Research Paper Example | Topics and Well Written Essays - 750 words - 3

The Future of India's Economy - Research Paper Example Most countries in the western world are facing declining proportion of working-age population due to aging; however, there is not going to be much change in the proportion of a working-age population of India in the years ahead. Aging population proportion is increasing every year across most developed economies and reasons attributed to the phenomenon are a reduction in fertility rates and gains in overall longevity of men and women. Only India and South Africa will have a higher share of the working-age population. In 2011, the working-age population in India, age 15-64, is estimated at nearly 65 % of the total population that will increase further to around 68% in 2030. Though it will decline slightly in 2060 in proportion to the total population, it will still be higher in percentage terms when compared with its level of 2011. This is important because most of the developed economies including Japan, the US, and China, the proportion of this working class would have reduced to le ss than 60 percent (Johansson et al. p14). From the table, it is amply clear that its annual population growth rate would be even lower than the US; however, it will be higher than China, which shows a negative growth rate in 2060. By 2060, India will be the top country in terms of population in the world. Crude death rate per thousand will be lesser than the US and China perhaps due to a relatively younger population in comparison to these countries. The infant mortality rate is an important indicator of health policies that prevail in the country, and on that count, it will still remain significantly higher than both the countries in comparison. Life expectancy for male and female both would have reached at the decent levels by then.

Criminology research paper Example | Topics and Well Written Essays - 1500 words

Criminology - Research Paper Example This is a worrying trend that should not only be left to the society and the law enforcers alone (Walsh, Anthony, and Craig Hemmens 57). According to recent research that was conducted, the results showed that high school male and female comprise of almost a quarter of crime arrests which is indeed an astonishing alarming rate. The research further shows that the rate of arrests of high female is nearly half the juvenile arrests as compared to two years ago when the rate was negligible to notice. Thus, more high school females are joining the gangs in order to commit criminal activities. It is also evident that more high school male and female are committing crime at an early age in their high school years which was not the trend before where the number was higher as the high school male and female graduated to upper classes. This shows that currently, the number is shockingly increasing with the majority being from the lower classes in the high system (Siegel, 114). The development of the juvenile justice system began more than a century ago where previously; the traditional English Common law was applicable. Initially, people who committed crime were confined in the same correction facility regardless of their ages. Thus, the old and the young were handled as adult criminals. The society including the families were fully responsible of disciplinary measures for the children but if the young adults committed crime that was viewed as above the norm, they were arrested and treated in a similar manner as an adult criminal. However, this system became abolished since the young adults instead of rehabilitating themselves they came out of the correctional facilities being hardcore criminals who had been hardened due to the influence on them by the adult criminals (Siegel, Larry and Brandon, 43). There was therefore the need to

Critical issue in global health ( a grant proposal to support efforts Thesis

Critical issue in global health ( a grant to support efforts to improve maternal and child health, in Kachere, a village in Kasungu. ) - Thesis Proposal Example As such, the CBO has come up with five strategies in the proposal namely; Improvement of maternal health in the community, Promote gender equality and empowerment to women, Combat HIV/AIDS, malaria and other diseases, Ensure that the environment is sustained, Eliminate poverty and hunger. Through these strategies, there will be direct and indirect solutions to this challenge and the community will remain healthy and full of life. Moreover, this project has incorporated stakeholders such as Traditional Authority (TA), Religious Groups, and Malawi International Organization (MIO) who will assist in planning and implementing the project. Apparently, it is evident that Kachere Village in Kasungu District has serious cases of poor health and poverty that has emerged from the poor living conditions of people in the village. Ideally, Eva’s two dead children serves as a perfect example how children have died from diseases such as pneumonia and malaria and those surviving are still suffering from related diseases. Moreover, the agricultural activities revolve around tobacco and maize farming, which are not easy to farm due to their inadequate returns. Furthermore, her husband who is alleged to be absent from home for extensive periods of time in search of employment has also became a challenging issue for Eva since is fear contracting HIV from the existing polygamy set up (Skolnik, 2008).   As a community based organization (CBO) on the ground, we have taken Eva’s living conditions as a sample to work with in the improvement of the living conditions of people in Kachere village (Hovenga & Mantas, 2005). Nevertheless, the CBO is aware that the community has three main stakeholders who are contributing towards development and health issues namely: Nongovernmental organizations (NGO) and International Organizations where the International Organizations have assisted in facilitating loans and savings to most groups that have been formed in the community. Of

Advertising and its Effects on Childhood Obesity Research Paper

Advertising and its Effects on Childhood Obesity - Research Paper Example This essay "Childhood obesity affected by advertising" outlines the connection between junk food advertisement and the level of children obesity. Young children are easily hooked when a product is displayed with the endorsement of role models or cartoon characters that they literally worship. For children who are not keen about cartoons, there are advertisements that portray peers of their own age, which is something that no child can resist following. Advertisements achieve success in their mission of penetrating children’s most basic desires. On the flipside, a child who has to grow strong with lots of physical activity gets relegated to the menial position of a couch potato and in the bargain compromises his or her potential for proper development and becomes obese. Considering the case of children that fall in the age group of 6-11, 22% of Mexican American kids are found to be overweight, 20% African American kids and 14% of non-Hispanic White kids also fall under the same category. â€Å"The childhood obesity epidemic is a serious public health problem that increases morbidity, mortality, and has substantial long term economic and social costs. The rates of obesity in America’s children and youth have almost tripled in the last quarter century. Approximately 20% of our youth are now overweight with obesity rates in preschool age children increasing at alarming speed. According to the Centers for Disease Control and Prevention, the prevalence of obesity has more than doubled among children ages 2 to 5 (5.0% to 12.4%) and ages 6 to 11 (6.5% to 17.0%)†