Did the privatisation of British Rail lead to an efficient outcome?
The privatisation of the railway network in the UK illustrates that competition and the free market lead to more efficient outcomes than the government ownership of ‘natural monopolies’. In some markets, such as natural resources and railway services, it can be more efficient to have small amount of suppliers or even one supplier only. The term Natural Monopoly comes to be used to refer a market where long-run average costs are lowest when output is produced by one firm. In these sorts of industries, the total fixed cost is majority of the total cost. Therefore, in the cost diagram, the Average Cost shape is like the Average total cost shape: sloping down. There is only economics of scale. As firms increase their size, average cost falls, benefiting both firms themselves and the whole society. This is a situation where one firm can supply the market at a lower price than two or more firms due to the existence of economics of scale and the avoidance of wasteful duplication. If these firms are in the private sector, as profit-maximisation is their goal, they are likely to charge very high price because in their knowledge, there will never be any competition. In the diagram, at the (profit-maximised) output, the price they sold (where AR cuts quantity output) is higher that average cost at that quantity output, generating Super Normal Profits. As a result, the market will
The General Strike 1926
The General Strike 1926 The origins of the general strike can be traced back as far as the demobilisation of British troops following the end of the Great War. For some years the nation was prosperous as women handed their jobs back to the men who returned. Britain sought to repair replace and build anew things which had been neglected between 1914 and 1918. Unfortunately this period of renewal was not to last, and as the demand for British goods was not as great as in the pre war period, the economy suffered. Millions of British workers were laid off as competition from abroad (many countries becoming self sufficient in various industries during the war) meant that Britain could not compete. By 1925 one quarter of British miners had been laid off. The denationalisation of the British staple industries encouraged much growth upon the stock exchange and investment from businessmen as profits soared. However for the working classes who kept them running, things were not so good. Many of the investors lost large sums of money when the stock market collapsed in 1921 and as an attempt to recoup their losses, industry owners began to decrease wages and increase hours worked. The pound fell in value as the government mistakenly set the price of sterling back against the 1914 price of gold. Prices rose because of shortages in supplies and imports, and many who were laid off had
The Benefits of Trade
A nation's industries, commerce, standard of living, and all other aspects of its economy are closely intertwined with the economies of foreign nations, through avenues such as goods, capital, technology and enterprise. Rising global prosperity further encourages nations to commit to harnessing relations with others in 'a world shrinking and becoming a single place.'(Marx) Not a new conception, the phenomena 'Globalisation', poses real opportunities and more surreal threats. Many contemporary authors in the field of science, politics and economics alike have resounded differing assumptions that support and contradict this newly formed sense of unity. Milton Friedman, an established economist, proclaims the ideology of a free market where 'no external force, no coercion, no violation of freedom is necessary to produce cooperation among individuals all of whom will benefit' (Friedman, p 2) In this essay, siding with the view of Friedman, I will define the key concepts of the free market and macroeconomic growth via 'the invisible hand', before critically evaluating one of its most sacred assumptions, the hypothesis that an 'invisible hand' will rid the threats of current existence and allow 'all parties to benefit.' (Friedman, p 7) Through evaluating the scope of the free market I will firstly assess the responsibility of government through intervention and secondly evaluate
Statistics Coursework
Statistics Coursework Introduction I am going to investigate two towns in Kent and look at the crime rates to see if it effects the price of the houses. There are many things that affect house prices. Some things have a short-term affect such as interest rates and unemployment rate, but others have long term affects such as Location of the house and access to basic amenities. I will be exploring all the things that affect house prices as well as comparing two areas in Kent and comparing the price of houses in these areas. Plan * I will begin my investigation by researching the price of property in Maidstone and Chatham. I will do this by using the Internet and liking at different estate agent websites. * I will look at the crime rates in the two towns and see if it effects the price. * I am now going to prepare some data collection sheets, this is where I am going to record the data that I am hoping to collect for my various sources of research. * I will collect my data from the internet, making sure that it is not bias. * I am now going to write up the data collection process, naming and any problems I come across on the way. * Next I am going begin some calculations to answer my hypothesis. I am going to start by working out the mean, median, mode and range. * Then I am going to do some graphs to show how house prices vary and some of the reasons
Corporate Social Responsibility.
CORPORATE SOCIAL RESPONSIBILITY Globalisation of the world economy is underway, and various groups, including national governments, multinational corporations and international organisations such as the World Trade Organisation, are promoting this. However, globalisation should not be detrimental to the welfare of society. As we have moved into the global market, there is an abundant supply of labour. Capital and free trade have expanded the possibilities. Some industries e.g. textiles, have moved from country to country seeking the lowest labour costs and highest profits. Firms operating in developing countries are often criticised for failing to be socially responsible in their operations (e.g. Nike & Gap were exposed as operating factories with sweatshop conditions) and this has lead to the development of Corporate Social Responsibility. According to Certo (2002) "Corporate Social Responsibility (CSR) is the managerial obligation to take action that protects and improves both the welfare of society as a whole and the interests of the organisation". The most publicised areas in which businesses can act to protect and improve the welfare of society are: urban affairs, consumer affairs, environmental affairs and employment practice affairs. Companies are beginning to recognise that improving their impacts and addressing wider social and environmental problems will be
"To achieve both internal and external balance the authorities must use both expenditure switching and expenditure changing policies." Discuss
"To achieve both internal and external balance the authorities must use both expenditure switching and expenditure changing policies." Discuss. Internal and external balances are two of the most important economic goals or objectives for a country. (The others include a reasonable rate of growth, an equitable distribution of income and, adequate protection of the environment). Internal balance " refers to full employment or rates of unemployment no more than 4 - 5 per cent" (Salvatore). The 4 - 5 per cent allows for frictional unemployment, that is the transition period between changing jobs and allows for re-training for workers. External balance refers to equilibrium in the balance of payments - " or a desired temporary disequilibrium such as a surplus that a nation may want in order to replenish its depleted international reserves". (SALVATORE) Most nations will prioritise internal balance rather than external balance, however in certain circumstances they may be forced to switch their priorities. In particular when presented with the problem of large external imbalances. At each countries disposal are two policies to rectify any imbalances either internal or external; they are expenditure - changing policies and expenditure - switching policies. Expenditure - changing policies revolve around fiscal and monetary policies. Fiscal policy refers to changes in
To what extent were the years C1925-1929 a time of economic and political stability for the Weimar Republic?
To what extent were the years C1925-1929 a time of economic and political stability for the Weimar Republic? The years 1925-1929 were described as the Golden Years for Germany. There were no attempts to over throw the government like the Sparticist uprising or the Kapp Putsch, therefore undoubtedly it was the best years compared to the problems before and after the Golden Years. The way the golden years were perceived would indicate to what extent were the years 1925 to1929 a time of economic and political stability for the Weimar Republic. There were developments in Germany during the Golden Years in the following essay we will learn where the developments took place and whether they disadvantaged Germany or helped her regain stability. An important economic feature that had to be stable before Germany could even start sorting her other problems with the economy was the currency. A new currency had been issued in November, the Rentenmark, which came in limited quantities. Stresemann attempted at stabilising the currency disregarding the Rentenmark, as a result by the mid 1920s Germany finally has stable currency again which was the start of helping Germany regain stability. Due to the stable currency, competitive interest rates and improving status in the international community, Germany had become a main point for foreign investment. Five billion dollars was invested
To what extent does the government budget/statement reflect current government priorities?
To what extent does the government budget/statement reflect current government priorities? In this study I will be investigating the extent to which the governments budget statement reflects their spending on current priorities, such as the NHS, Defence and Education. To do this I will be researching changes in spending using the current budget statement (2007) and also other secondary data resources to find out the total percentage of the governments budget is spent on specific areas, such as housing, defence, public transport etc. I aim to find out how much spending in these areas has increased in recent years, or indeed whether spending has decreased over recent years. Priority One: The Environment. The environment, or more precisely protecting it is a key concern for today's government, and an issue that they appear to be trying to combat. In the 2007 budget the government announced an 800million pound window for the environment transformation fund, this is to finance overseas development programmes that deliver both poverty reduction and environment benefits in developing counties. The government is also increasing the funds available through the Low Carbon Buildings Programme, to a total of over 18million pounds. This is to help meet the demands for households for microgeneration technologies. This extra funding combined with other funding towards housing and the
"What do sociologists mean by the term 'Globalisation' and how have they tried to explain it?"
"What do sociologists mean by the term 'Globalisation' and how have they tried to explain it?" Many historians and sociologists have identified a transformation in the economic processes of the world and society in recent times. There has been an extensive increase in developments in technology and the economy as a whole in the twentieth century. Globalisation has been recognised as a new age in which the world has developed into what Giddens identifies to be a "single social system" (Anthony Giddens: 1993 'Sociology' pg 528), due to the rise of interdependence of various countries on one another, therefore affecting practically everyone within society. In this essay I will give a detailed explanation of what sociologists mean by the term 'globalisation' and how they have tried to explain it. Globalisation can be construed in many ways. Many sociologists describe it as an era in which national sovereignty is disappearing as a result of a technological revolution, causing space and time to be virtually irrelevant. It is an economic revolution, which Roland Robertson refers to in his book 'Globalisation' 1992 pg 8, as "the compression of the world and the intensification of consciousness of the world as a whole". It is argued that globalisation allows the world to become increasingly more united, with people more conscious of ethnic, societal,
What is Globalisation?
CONTENTS * Introduction to Globalisation Page 2 * Varying Levels of Globalisation Page 2 * Change in Management Structures Page 4 * Management Controls Page 5 * Transfer of Information Page 6 * Evolution of the Global Firm, Product or Geography? Page 6 * Conclusions Page 7 * References and Bibliography Page 8 * Appendices Page 9 Globalisation Globalisation is defined as "tightening international linkages on a world-wide scale". (De Wit and Meyer, 1988). As barriers to the movement of capital and tariffs are eliminated, some global organisations providing typically standardised products to world markets have in the extreme, become more powerful than nation states. (Dicken, 1998). The global firm, as opposed to the multinational firm operates with resolute consistency, at low relative costs, as if the entire world, (or major regions of it) were a single entity; in other words it sells the things in the same way everywhere1. Global Integration is leading to the promotion of international best practice through the sharing of knowledge and experience. Traditional business practices have disappeared as individual preferences have become similar, leading to the standardisation of products that, inevitably has a profound impact on organisational design. In the past there were huge inefficiencies in the flow of information around the world,
