Globalization and Labor Sweatshop Globalization is indeed a significant effect on the system's employment. This is because globalization has increased the integration of the world, especially in the economic field that directly participate impact on the flow of capital and labor. Capital and labor flows have strong linkages with each other. Then with the easy flow of capital engaged in international economic activity then automatically flows of labor would be more flexible. Then the consequences are increased competitiveness in the employment opportunities.
Identify and explain the main economic factors that affect the demand for a product; the supply of a product and the resulting product price. The main economic factors that affect the demand of a product Price Price is considered the most important factor that affects demand; higher the price of a product, lower the demand and vice versa. Income levels Changes in income levels determine the buying power of an individual, thus an increase in income levels increases their ability to purchase goods and services. Thus the demand for a product will increase. Consumer tastes and preferences As society evolves, the tastes and preferences of consumers change too.
7 The employment level is expected to be positively affected by trade liberalization due to ease access to cheap raw material and capital machinery, which promote development opportunities in a country. Trade Liberalization It is the openness index which is represented by trade-GDP ratio i.e the sum of export and imports to that of the GDP. TL= (X+M)/GDP Where X Total exports of country M Total Imports of country GDP Gross Domestic Product of India As export increases the value of trade liberalization also increases and vice versa. . Hence, more openness Human Capital It can be expressed as the skills, knowledge, and experience possessed by an individual or population, viewed in terms of their value or cost to an organization or country.Here,
These two may conflict when there is a change in demand for exports. A change in demand for exports may change the demand for the domestic currency, causing the exchange rate to fluctuate. A fluctuating exchange rate can discourage investment in a country and reduces exports as well. It harms the
Price elasticity of demand is a relationship measure between the changes in the quantity of products demanded and the changes in product prices. It is used in economics in price sensitivity discussions because it indicates the responsiveness of a product’s demand on price changes in the market. The price elasticity of demand can either be elastic or inelastic depending on the changes in demand and the product cost. It is computed by dividing the percentage changes in the quantity of products demanded by the percentage of change in the price of the products demanded. Price elasticity of demand is elastic if a small change in price is followed with a big change in the quantity of products demanded for in the market.
Economic growth is the increase in the capacity of the economy to produce goods and services, making the production possibility curve of an economy shift outward (Fig 1.1). When an economy is growing, it is likely to display a rise in national income, mainly real GDP and or GDP per capita. When comparing these figures between countries with different currencies, it is useful to use the Geary-Khamis 1990 US dollar as this adjusts the purchasing power parity. Though these figures are easy to understand, calculating national income statistics is a long and tedious process and often come up with inaccurate and sometimes wrong results. At most, these numbers are a close estimate.
Arbitrages do exist, due to the changes of the factors of foreign exchange rate and interest rate. Through the different foreign exchange rate of the currencies between different countries, it gives the opportunities to the arbitrageurs to gain the profits through buying a currency with a low rate in one country and simultaneously selling it in another country with a higher rate. Meanwhile, the same procedures for the interest rate, the arbitrageur buying a foreign currency with domestic currency and profit from the difference between the interest rates of two countries. Moreover, in case of market liquidity increasing, the asset prices also increasing, so the issuers will obtain more benefits. In addition, monetary policy has no significant effects on asset prices, but it still reacts actively to the asset
The first one is cost of production- cause if the cost of any factor of production decreases, the quantity that producers are able to supply at a given price increases. Second is changes in government policy, as in government spending and taxation influence employment and household income, which dictates consumer spending and investment. Third one is changes in the numbers of producers increased demand to increased supply, decreased demand so it will decrease supply. There is also two terms you need to know about supply elasticity, one is if supply is elastic, a change in the price will cause a change in the number of items produced. The other is inelastic, a change in the price will not cause a change in the number of items produced.
Idealists and liberalists view it as the improvement in the economy as a result of trade restrictions being reduced and more capital movements, investments and people across borders. The Marxists see globalization as way of spreading capitalism and finding ways to oppress the economy of the third world countries. (Baylis et.al, 2008). They also believe that globalization will lead to more suspicion and