Sunday, August 11, 2019
Design and Contemporary Culture Essay Example | Topics and Well Written Essays - 2250 words
Design and Contemporary Culture - Essay Example In support of their ideologies, the authors present the case of the crisis of Victoria in British Columbia that saw the rise of teenage violence in the early 2000s. The authors explain how this violence and chaos were brought out as a social crisis in the state after years of hiding owing to the fear of tarnishing the cityââ¬â¢s image. The authors also use other cases of youth violence and crime, as well as, the responses towards these situations, in support of their arguments regarding social construction of crises. In essence, the authors explain the role of the media in both, representing the real picture during crisis and its inability to grasp the intricacy of the truth of the crisis1. This first section of the article also explains what is to be covered in the next sections, and facilitates the comprehension of some of the ideas and concepts regarding social construction. Representation. Having introduced the story of youth violence in the first section of the article, Oâ⠬â¢Brien and Szeman examine the concept of representation as is relates to social construction. The term representation is defined as the social construction of meaning by use of sign systems2. ... Representation affects peopleââ¬â¢s thoughts and perceptions concerning certain events, hence its role in social construction. To, further, elucidate their ideas regarding representation, the authors also draw attention to the structuralist theories of representation, as well as, the rules of representation in social construction. As explained in the article, the structuralist theories of representation are focused on the indirect meanings of words and cultural practices, as opposed to, their direct meaning. Put simply, these theories put more emphasis on how words mean instead of what they mean4. Oââ¬â¢Brien and Szeman provide the example of the semiotic theory in support of this, and they explain how this theory has had a major impact on culture. Essentially, the semiotics theory consists of two main elements including the langue and parole. The langue is what the authors refer to as the what the meaning is, where as the parole refers to how the meaning is presented. The lang ue is also associated with the system as a whole as existent on the abstract level, whereas, parole has been closely linked with individual utterances5. Oââ¬â¢Brien and Szeman also discuss the rules of representation, and how their application in social construction. The authors explain the rules of representation are quite simple and they involve drawing the line between storytelling and the depiction of actual events. While these two principles may have a relation in social construction, the authors explain that the ability comprehend the role of these two elements in social construction is imperative. It provides individuals with the ability to draw out made up stories from actual realities. To support their argument, Oââ¬â¢Brien and Szeman provide
Saturday, August 10, 2019
How does the Two Treatises of Government affect the concept of human Essay
How does the Two Treatises of Government affect the concept of human right in modern society - Essay Example Secondly, I will state the philosophy that is most convincing and lastly, I will make a conclusion. Thomas Hobbes one of the seventeenth-century English philosopher believed that absolutism is the most logical and desirable structure of government (Perry, Chase, Jacob, J., Jacob, M., & Von Laue 2012:250). This kind of thinking was motivated by the experience of the pains of the English Civil war and witnessed the execution of Charles I in 1649. He accentuated that the unlimited power of the sovereign is the only way to suppress the human passions that damage the social order and terrorise civilized life. He suggests that for people to pursue their personal interests there is need for a secure environment that is provided by an absolute rule (Perry, Chase, Jacob, J., Jacob, M., & Von Laue 2012:250). Hobbes dismissed the authority of religion and tradition and viewed them as not compatible with the political science hence build his political philosophy on a scientific base. In his quest for absolutism he never considered God as the giver of monarchââ¬â¢s power nor was the state under the command of a higher spiritual dominion and its proposition that when a state disobeys Godââ¬â¢s law its commands should not be implemented. Hobbes viewed human as grasping and selfish and proposed that human relations are preserved through rivalry and dispute and not through collaboration. Hobbes describes human behaviour as one that is dominated by passion instead of reason. He recommended governance that limits power as the only method of securing human from each other and preserve the life of the civilised (Perry, Chase, Jacob, J., Jacob, M., & Von Laue 2012:251). On the other hand, John Locke viewed human beings as rational in nature and controlled by a feeling of moral responsibility. He believes that people are in a position to respect the deep-rooted nobility of other people and limit their selfishness. He
Friday, August 9, 2019
Chinese Coolie Labor Essay Example | Topics and Well Written Essays - 750 words
Chinese Coolie Labor - Essay Example es between the Chinese coolie trade and African slave trade was that the coolies were either deceived or kidnaped and then kept in detention centers that were as dangerous as the once used in the slave trade. The difference between the trades was that the Chinese government kept tabs on what was happening to the coolies that had been contracted in the Latin American region, USA, Canada. The coolies were also paid as per the contract agreement as opposed to African slaves (1). According to Hu-Dehart (1994), The coolies that went to Cuba most of them died due to mistreatment or the poor working conditions. Most of them did not out leave their contract that was mostly for around six years. The other difference between the Chinese Coolies and African slave trade is that whereas the African slaves got captured, the Chinese coolie went to work voluntarily due to factors like poverty and famine. The coolie trade is very different from the slave trade and cannot be considered as slave trade. This is because the two are very different. Below are some of the reasons that make the coolie trade different from the slave trade. They included: The coolie workers had a contract: according to According to Hu-Dehart (1994), the coolie workers had a contract of five years under the British and eight years in Cuba and Peru. The contract was between a free employee and an employer. The contract also spelled out the duties and obligations of the employees. It also included the wages and the other kind payment that the employer could receive like food clothing and housing (39). The coolies also had the right to buy out their contract at the end of their contract or when they reached the age of twenty-six years so long as they had the funds to buy out their contraction. In case of a slave, one remained so their whole life that is why it sis unfair to say that coolie trade was slavery since coolies had the right to regain their freedom at the end of the contract (44). The coolies
Thursday, August 8, 2019
D-Day, Invasion of Normandy, France (World War II) Research Paper
D-Day, Invasion of Normandy, France (World War II) - Research Paper Example As a consequence lead to France and Britain launching war against Germany two days later. Other countries then joined the war taking different sides depending on the side they supported (Hastings 1945). The war continued resulting in the battle of Normandy which is considered as the last greatest set-piece war that has ever occurred in the Western world. This paper will explore the events of the D-Day invasion of Normandy, France during World War II. Fein (5) notes that at the dawn of June 6, 1944, one of the greatest and historic battles started. Under leadership of United States of America, its allied forces entered France. The first Paratroopers were composed of approximately 175, 000 US allied soldiers sent to France that day. The first battle was fought for 24 hours during that day. This daring 24-hour battle is what is termed as D-Day. However, the war that followed after the D-Day is considered one of the most important wars of World War II which began in 1939 and ended in 194 5. This battle is what is known as The Battle of Normandy according to Fein (5). Fein (5) asserts that in 1944, the Axis controlled most parts of Europe. The Axis powers were under the leadership of Germany with the other axis powers consisting of Japan, Italy and Romania. The D-Day invasion of Normandy was the launching point of the Allies for Europeââ¬â¢s invasion. Under the strategy, the Allied forces first planned to liberate France from the control of the Axis. This was then to be followed by waging another war aimed at freeing the rest of Europe. The Allied countries consisted of the United States of America as the leader, the Soviet Union, Great Britain, and several other countries. Hitlerââ¬â¢s Troops The World War was caused by the fact that Adolf Hitler, then German chancellor, wanted the world to be under his control. This however never came to be as Hitler killed himself in April, 1945, days before Germany conceded to defeat (History Learning Site par 1). Fein (6) reveals that at that time, the German Army was perceived to be one of the strongest in the world. By 1944, German army had taken over most of Europe but later started to show some signs of weakness. It is reported that earlier in the battle, German arsenals had severely suffered huge losses in Africa and the Soviet Union. Therefore, by the time of D-Day battle, millions of German armies were dead or taken as prisoners. Fein asserts that the German arsenals were thinly spread making it weaker. Despite the situation, many German troops still fought in the Soviet Union and on other numerous fonts. Nevertheless, the army still could not respond well both defensively and in form of attacks. This gave the Allies the courage to hit harder as they knew that Hitler was now headed for another defeat. Stalin Demands Action Fein (7) reveals that as the war began, the Soviet Union recorded significant success in fighting Germany. However, due to huge bombardments and losses it incurred, it neede d support from the Allied forces to help it continue with the war. It is reported that at first, Germany invaded the Soviet Union in 1941. This led to the deaths of many soldiers and civilians from Soviet Union. In 1942, Joseph Stalin, the leader of the Soviet Union called upon the Allied forces to invade Europe. This was due to his belief that a huge attack in Europe would force Hitler to
Wednesday, August 7, 2019
Novels and god Essay Example | Topics and Well Written Essays - 250 words
Novels and god - Essay Example In this context, the author quotes and correlates the Bible by stating, ââ¬Å"Woe to those who go to great depths to hide their plans from the Lord, who do their work in darkness and think, ââ¬Å"Who sees us? Who will know?â⬠(Isaiah 29:15). This gives us a great understanding of God and morality that behind human actions, this itself is free will. I think one can sense the serenity of Susie and other authors on acceptance of faith even though they had the misfortune of this terrible crime such as Susie in Lovely Bones. However, some readers may feel angry and even frustrated about religion and morality. It almost seems that one can be mad about God not punishing these killers. On the contrary, nothing is ever hidden from God and this world is just an illusion. Some readers understand that everyone must give account to God and it may seem that they get away with their heinous crimes, but that is not the reality of the matter. "The Lovely Bones also known as "Lovely Bone," "Lovely Bones," "Desde mi cielo," "Amabili resti," "Cennetimden Bakarken," "Flickan frÃÆ'à ¥n ovan," "In meinem Himmel," "Oma taivas," "PevnÃÆ'à © pouto," "Um Olhar do ParaÃÆ'à so," "V mojih nebesih," "Visto do CÃÆ'à ©u"." The Lovely Bones (2009) ...review and/or viewer comments à ¢Ã¢â ¬Ã ¢ Christian Spotlight on the Movies à ¢Ã¢â ¬Ã ¢ ChristianAnswers.Net. N.p., n.d. Web. 10 June 2014.
Feminist Criticism of Triffles Essay Example for Free
Feminist Criticism of Triffles Essay The bone of contention for feminist theory is centered at the treatment of women living in a patriarchal society. Feminists raised questions about why women were being forced into a position of subordination and their affairs looked at with marginal importance. Susan Glaspellââ¬â¢s story ââ¬Å"Triflesâ⬠depicts the plight of women and their subordination while subversively commenting on the negative effects this had on the female psyche. ââ¬Å"Triflesââ¬Å" begins with an investigation into the murder of John Wright, which takes place at his farm house. His wife, Mrs. Wright, is found at the crime scene and put in jail. She asks three of her friends, who are wives of the detectives investigating, to collect her apron and shawl. While the men scamper about trying to solve the crime of who did it, the women rifle through Mrs. Wrights belonging in search of her request. Noticing simple things out of place in the home or the trifles (as the men call it), they inadvertently find clues that reveal Mrs. Wright to be the murderer. It is said, the devils in the details which proves to be accurate in this situation. Glaspellââ¬â¢s story is a commentary on the societal values of women at the time and their roles in the home. By using theorists such as Gilbert and Gubar, Fetterly, and Irigaray, one can see how Glaspell uses a feminist critique to call to question the inequalities of women and highlighting the detriment this subordination has on females. ââ¬Å"Triflesâ⬠embodies the problems of alienation women faced in the hands of a patriarchal society. Julie Rivkin and Michael Ryan say ââ¬Å"the subject of feminism was womenââ¬Ës experience under patriarchy, the long tradition of male rule in society which silenced womenââ¬Ës voices, distorted their lives, and treated their concerns as peripheralââ¬Å" (527). We see this in the beginning of ââ¬Å"Triflesâ⬠, ââ¬Å"Mrs. Peters: Oh, her fruit; it did freeze. She worried about that when it turned so cold. She said the fireââ¬â¢d go out and her jars would break. Hale: Well, women are used to worrying over triflesâ⬠(Glaspell, 1043). The womenââ¬â¢s voice is silenced by the manââ¬â¢s failure to recognize her concerns as legitimate. When presented with a concern from a woman, instead of paying attention, the men dismiss the women and their observations and silence them from speaking further. This alienates the women, placing them in a lower status. Of this Luce Irigaray say, ââ¬Å" A direct feminine challenge to this condition means demanding to speak as a (masculine) ââ¬Å"subjectâ⬠, that is, it means to postulate a relation to the intelligible that would maintain sexual differenceâ⬠(570). By Glaspell participating in the canon of literature and bringing attention to the female issue of subordination, she is challenging and demanding to speak in ââ¬Å"masculineâ⬠terms, as literature was dominated by males. According to Judith Fetterley ââ¬Å" American Literature is male. Our literature neither leaves women alone nor allows them to participateâ⬠(561). Glaspell shatters this. She is participating in a genre of art that was viewed as predominantly male. Also, she not only gave her female characters a participatory role, they had the most important role, while the men were secondary and almost needless. Speaking to the ââ¬Å"silencing of voicesâ⬠Glaspell writes, ââ¬Å"Mrs. Peters: [looking in cupboard] Why, hereââ¬â¢s a bird cage. [Holds it up] Did she have a bird, Mrs. Hale? Mrs. Hale: Why I donââ¬â¢t know whether she did or not-Iââ¬â¢ve not been here for so longâ⬠¦ She used to sing real pretty herselfâ⬠(1047). It goes on to read about Mr. Wright, ââ¬Å" Mrs. Hale: But he was a hard man, Mrs. Peters. Just to pass the time of day with him-[Shivers. ] Like a raw wind that gets to the bone. [Pauses, her eye falling on the cage. ] I should think she would ââ¬Ëa wanted a bird. But what do you suppose went with it? â⬠(1048). As Rivkin and Ryan state, as mentioned above, the man silences the woman. Mr. Wright silenced Mrs. Wright, not allowing her to sing, ââ¬Å"distortingâ⬠her life. Judith Fetterley believes that there is a certain amount of ââ¬Å"power that marriage puts in the hands of menâ⬠(563) and ââ¬Å"ownership of women is invoked as the index of powerâ⬠(564). Because Mrs. Wright was so changed by her husband, ââ¬Å"Mrs. Hale: She-come to think of it, she was kind of like a bird herself-real sweet and pretty, but kind of timid and-fluttery. How-she-did-changeâ⬠(1048), she was not only isolated in her home with her husband but her life was de valued, therefore she changed. Mr. Wright wanted her to be silent which is reminiscent of what Gilbert and Gubar say that a woman should be waiting ââ¬Å"silently, without calling attention to her exertionsâ⬠as it would detract from her focus on others (601). ââ¬Å"Triflesâ⬠also reads, ââ¬Å"Mrs. Hale: I might have known she needed help! I know how things can be -for women. I tell you itââ¬â¢s queer, Mrs. Peters. We live close together and we live far apart. We all go through the same things-itââ¬â¢s all just a different kind of the same thing. â⬠(Glaspell, 1049). Here Susan Glaspell is pointing out the alienation that is a prevalent feeling amongst women. This feeling is induced by the patriarchal society that does not allow them to have a life of their own. Glaspellââ¬â¢s character Mrs. Wright sacrifices everything because thatââ¬â¢s what her husband demanded, which was the status quo. Gilbert and Gubar also state ââ¬Å"For to be selfless is not only to be noble, it is to be dead. A life that has no storyâ⬠¦Ã¢â¬ (602). Mrs. Wright is the embodiment of these ideas. She is isolated, alienated, and quiet; sheââ¬â¢s expected to be angel-like. The angel/devil binary is discussed by Gilbert and Gubar. The idea is that women have two sides to them. One side that is silent, submissive, obedient, and the other that is a monster, conniving, and deceitful (605). Though Mrs. Wright could be critically looked at as being a product of this angel/devil binary, more importantly Glaspell is challenging the maleââ¬â¢s role in this binary. Essentially she is pointing out that by men placing women in a submissive role they are contributing to this angel/devil behavior they are critical of. The fact that the angel woman manipulates her domestic/mystical sphere in order to ensure the well-being of those entrusted to her care reveals that she can manipulate; she can scheme; she can plot- stories as well as strategiesâ⬠(602). The woman can do no right. Fetterley points out ââ¬Å"the sacrificial scapegoat is the woman/wife and the cleansed survivor is the husband/male. In such fictions the female reader is co-opted into participation in an experience from which she is explicitly excluded; she is asked to identify with a selfhood that defines itself in opposition to her; she is required to identify against herselfâ⬠(562). Typically this is true because the male perception of women is that they should be angels, self sacrificing, subordinate but criticize this because they also believe the binary opposition to women is the devil. They are eliminating an identifiable character for the female reader, alienating them. Glaspell however, allows the female reader to identify with her female characters. In ââ¬Å"Triflesâ⬠the women are doing ââ¬Å"female thingsâ⬠looking about the kitchen, paying attention to the sewing, noticing the rotten fruit. Essentially everything that has to do with house hold matters. The men are utside looking for clues in the barn, completely unaware or unaltered by the fact that a woman could possibly have committed such an atrocious crime. After all, action is male and silence is female. Gilbert and Gubar quote from Eichner, ââ¬Å"the ideal of significant action is masculineâ⬠and ââ¬Å" women are defined as wholly passive, completely void of generative powerâ⬠(599). Because women are viewed as having no power the men over look the evidence in the house; The house is for the women and their trifles. At the end of ââ¬Å"Triflesâ⬠the women find Mrs. Wrights dead bird, with a broken neck. Coincidentally the same way her husband was murdered. The bird is wrapped up in her quilt, when it is found the story reads, ââ¬Å"Mrs. Hale: [Jumping up] But, Mrs. Peters- look at it! Itââ¬â¢s [sic] neck! Look at its neck! Itââ¬â¢s all-other side to. Mrs. Peters: Somebody-wrung-its-neckâ⬠(Glaspell 1048). It is at this moment the women realize that Mrs. Wright has killed her husband. The attorney walks in and says ââ¬Å" [As one turning from serious things to little pleasantries] Well, ladies, have you decided whether she was going to quilt it or knot itâ⬠(Glaspell 1048). By asking about quilting or knotting he is referring to the stitching on Mrs. Wrights quilt. The quilt is one of the ââ¬Å"triflesâ⬠indicating Mrs. Wright as the murderer. Once again, Glaspell is drilling it into the readers head that the men think womenââ¬â¢s concerns are unimportant. As the story goes on, the women allude to the fact that Mr. Wright could have played a hand in the death of the bird Mrs. Wright loved so. Glaspell continuously points out the domination and control of the men (Mr. Wright in this case) and the psychological effects it has on the women. Mrs. Peters: [ In a whisper. ] When I was a girl- my kitten- there was a boy took a hatchet, and before my eyes-and before I could get there-[Covers her face an instant. ] If they hadnââ¬â¢t held me back I would have- hurt himâ⬠(Glaspell, 1049). Not only are grown men oppressive of women, it appears that Glaspell is also commenting on the societal values of child rearing, pertaining to sex. The little b oy is allowed to act violently (action is masculine) but the little girl has to be held back, and allow whatever grief she feels to over come her with not outlet. This speaks to Rivkin and Ryanââ¬â¢s idea of a constructionist or essentialist child rearing. In other words, are children taught their roles of femininity and masculinity or are they innate? By the child scenario given in ââ¬Å"Triflesâ⬠Glaspell notes that the different genders abide by different ideals. The little boy (fulfilling essentialism) is allowed to be ââ¬Å"activeâ⬠fulfilling his innate desire to take a hatchet to the cat. The little girl is fulfilling the constructionist role. Her gender is being created when she is being told how to act, being held back and constrained, none of these being her first choice. As children, it would appear, little boys are able to act on their natural desires, while little girls have to grin and bear it. Of these two ideals Gilbert and Gubar say, ââ¬Å"two perspectives began to form, one ââ¬Å"constructionistâ⬠or accepting of the idea that gender is made by culture in history, the other ââ¬Å"essentialist,â⬠more inclined to the idea that gender reflects a natural difference between men and women that is as much psychological, even linguistic, as it is biologicalâ⬠(529). These roles the children learn, carry with them into their adult lives where women are oppressed and men are free. This is another example of women being isolated from a young age. The last scene of ââ¬Å"Triflesâ⬠is Mrs. Hale putting the dead bird in her pocket, keeping Mrs. Wrights secret. ââ¬Å" County Attorney: No, Peters itââ¬â¢s all perfectly clear except a reason for doing it. But you know juries when it comes to women. If there was some definite thing. Something to show-something to make a story about- a thing that would connect up with this strange way of doing it-â⬠( Glaspell, 1050). The men in their ignorance donââ¬â¢t see whatââ¬â¢s in front of them. The evidence was there, they just let their social conventions detract from the situation at hand. In a way, Glaspell is making the male gender look foolish. By placing the evidence in conspicuous places, their inability to find clues is commenting on the narrow scope of males. ââ¬Å"County Attorney:: Oh, I guess theyââ¬â¢re not very dangerous things the ladies have picked out. [Moves a few things about, disturbing the quilt pieces which cover the box. Steps back. ] No, Mrs. Peters doesnââ¬â¢t need supervising. For that matter, a sheriffââ¬â¢s wife is married to the law. â⬠(1050). As everyone leaves the scene they police suggest checking what Mrs. Peters is removing from the house. The attorney is almost amused at what he finds to be trifles that she is collecting ( the apron, shawl, quilt) when she is in fact removing the evidence he was searching for. The women in this story feel bad for Mrs. Wright. They are not ââ¬Å"married to the lawâ⬠but dedicated to the common bond of the alienated woman. The law that the attorney says Mrs. Peters is married to, is a patriarchal law that oppresses women and makes them subjects of the system. These womenââ¬â¢s devotion truly lies with each other and their struggle to survive an oppressive society. If in marriage a woman is isolated and dominated, her only sense of self lies within the common struggle. Because she identifies with the sadness of Mrs. Wright she with holds evidence. Susan Glaspellââ¬â¢s ââ¬Å"Triflesâ⬠provides a solution to many of the inherent problems the feminist scholars bring to light. She writes about the alienation of women and how a patriarchal society is silencing. Womenââ¬â¢s voices are not heard and when they are, there opinions and concerns are dismissed, regardless of their importance. Glaspell uses the relationship between her male and female characters to exemplify this. Glaspell challenges the notion of the male writers point of view in that she, simply by writing and challenging, is taking on the male characteristic of action as opposed to silence. She also plays with the duality of the notion of woman, angel and devil. She constructs a character that could be seen as the angel/devil, but subversively comments on society pushing the woman into these roles they find so disagreeable. This further leads into the idea of constructionist and essentialist where girls identities are constructed while boys are innate, causing a future of oppressive relationships.
Tuesday, August 6, 2019
Classical Theory of International Trade
Classical Theory of International Trade The purpose of this chapter is to review the existing body of knowledge about foreign direct investment and the studies on strategies adopted to attract FDI. It attempts to present a summary of the relevant theories, hypotheses and schools of thought that contribute to the understanding and fundamental motivation of FDI flows. An exploration of these theories will assist in the study and it will support arguments to be used in empirical estimation and discussion. Additionally the aim of this chapter is to review the theoretical approaches to the determinants of FDI, also known as private foreign investment. Various theories have been developed since the World War II to explain FDI. These theories state that a number of determinants both at micro and macro level could explain FDI flows in a particular country or a particular region. Various studies have also been published on the assessment of the key determinants of FDI. However, there is no general agreement insofar, especially that in different context, specific factors may vary significantly in their degree of importance as regards to FDI. 2.2 Definition of FDI Foreign direct investment (FDI) is a category of investment that reflects the objective of establishing a lasting interest by a resident enterprise in one economy (direct investor) in an enterprise (direct investment enterprise) that is resident in an economy other than that of the direct investor. The lasting interest implies the existence of a long-term relationship between the direct investor and the direct investment enterprise and a significant degree of influence on the management of the enterprise. The direct or indirect ownership of 10% or more of the voting power of an enterprise resident in one economy by an investor resident in another economy is evidence of such a relationship (OECD, year 2008 Benchmark Definition of Foreign Direct Investment 4th Edition). The Benchmark Definition is fully compatible with the underlying concepts and definitions of the International Monetary Funds (IMF) Balance of Payments and International Investment Positions Manual, 6th edition (BPM6) and the general economic concepts set out by the United Nations System of National Accounts (SNA). In accordance with the Organisation for Economic Co-operation and Developments (OECD) Benchmark Definition, Foreign Direct Investment (FDI) is said to be an investment which entails a long duration equation and is an indication of sustained interest and authority by a hosted firm in an economy (foreign direct investor or origin firm) in a firm hosted in a country other than that of the foreign direct investor (FDI firm or associated firm of foreign affiliate). FDI entails both the initial dealing between two enterprises and all following money dealing between them and amid the associated firm, both integrated and non-integrated (OECD, 2008). The concept of FDI took prominence in 1962 following the publication of an article- Development Alternatives in an Open Economy by Hollis Chenery and Michael Bruno wherein a two-gap analysis of capital requirements was formulated. They pointed out that foreign investment apart from foreign aid and foreign trade was important to fill the resource gap needed to finance economic development especially for countries where their imports exceed their exports. FDI stimulates larger flows of private capital for the development of the recipient countries. Increase in FDI is not enough. It must ensure that the said increase is meeting the development objectives of the recipient countries. FDI must go beyond private while government must ensure that risks are not too high or the return on investment is not too low. Being given that private capital offers some special advantages over public capital, there must be a mutual interest for both private foreign investors and the host country. The latt er will have to assist in securing information on investment opportunities and establish economic overhead facilities such as industrial estates, protective tariffs, exemption from import duties and tax concessions schemes. 2.3 Theories of FDI Over the past few decades, extensive research have been conducted on the behaviour of multinational firms and determinants of FDI and many authors have put forward various theories (and complementary) to explain them. Theories and contexts that are being developed are challenging established facts, systems and knowledge bases. Though many theories have been developed to explain various dimensions of FDI, the current chapter will endeavour to examine the following paradigms considering the scope of the present study namely: the classical international trade theory, the neoclassical location theory, the market imperfection theory, the OLI paradigm and Porters Diamond theory. Broadly speaking the theories could be classified as international trade theories dealing with comparative advantage for nations to go for trade and foreign direct investment theories relating to corporate advantage for foreign corporationsà entering the host countries. 2.3.1 Classical Theories of International Trade The concept of FDI cannot be disassociated with the basis of why countries trade and the latter has been pioneered by the famous classicists namely Adam Smith (1776) with his Absolute Advantage theory and David Ricardo (1819) with his Comparative Advantage theory of trade. Adam Smith, the founder of economic theory, was the first to broach in Wealth of Nations that business would grow internationally for real economic growth. Both Smith and Ricardo concluded that countries would benefit from international trade if they have an absolute and comparative advantage in those products that they would be exporting and they should import those goods for which they have an absolute and comparative disadvantage. Consequently they were of the opinion that there should be complete specialisation by the countries involved in international trade based on the same principle as that of division of labour. They based their reasoning on the labour theory of value. The labour theory of value states that the value or price of a commodity is equal to or can be inferred from the amount of labour time going into the production of the goods. It, however, assumes that labour is the only factor of production and that it is also homogeneous. Because of these restrictive assumptions, the labour theory of value was contested and replaced by the opportunity cost advantage propounded by G.Haberler in 1936. The latter emphasised more on how a country has a comparative advantage rather than on what are the determinants of comparative advantage. It says that the cost of a commodity is the amount of a second commodity that must be given up in order to release just enough factors of production or resources to be able to produce one additional unit of the firstà commodity. Consequently labour will not be the only factor of production and will not be homogeneous. 2.3.2 The Heckscher-Ohlin (HO) Theory The HO theory also known as factor endowment model was put forward by Heckscher (1919) and Ohlin (1933) and was among the modern theories of international trade showing the causes of international trade. Adam Smith and David Ricardo remained silent on the causes of trade and on how trade affects factor prices and the distribution of income in each of the trading nations. The HO theorem postulates that each nation will export the commodity intensive in itsà relatively abundant and cheap factor and import the commodity intensive in its relatively scarce and expensive factors of production. It implies that a country must have the necessary resources to export goods. Some of the assumptions of the model again act as its own limitations on its effectiveness namely when it comes to free trade with no transport costs, tastes are similar across countries, perfect competition in factor and commodity markets, factors immobility internationally, use of same technology in the production of the two goods andtwo factors of production and two countries model (2x2x2 model). There has been extensions to the HO model namely through the Stolper-Samuelson model (1949) and Rybczynski theorem (1955). These theorems postulate that trade leads to the equalisation of relative and absolute factor prices between nations so that there will be internationalisation of prices and wages based on still the restrictive assumptions as those under the HO model. As Faeth (2009) and Seetanah and Rojid (2011) highlight, the first explanations of FDI were based on the models propounded by Heckscher-Ohlin (1933), according to which FDI was motivated by higher profitability in foreign markets with the possibility to finance these investments at relatively low rates of interest in the host country. Ohlin also observed that availability and securing sources of raw materials, flexible and business friendly trade policies as well as accessibility and availability of factors of production were the components influencing FDI inflows into the country. 2.3.3 Modern International Trade Theories There have been empirical tests concerning the traditional trade theories namely the Ricardian and HO models. Some tests have gone according to the theories while others have disproved them. For instance Sir Donald MacDougall in 1951 tested the Ricardian theory using the 1937 data for the USA and UK for 25 industry groups whereby it was found that US wages were twice as those for UK resulting in the USA being capital intensive while UK being labour intensive. However, according to Dougall there is incomplete specialisation as opposed to complete specialisation proposed in the Ricardian model. This is based on the fact that tastes are different, products are non-homogeneous, transport costs matter and industry groups are highly aggregated where we can have different model for a particular products like cars and cigarettes. The USA may have comparative advantage in cars but this does not prevent the UK from exporting one or two different models. Sir Donald MacDougall has also in 1960 talked about the benefits and costs associated with private investment from abroad. He pointed out that an increase in FDI will lead to an increase in real income based on the fact that value added to output by foreign capital is greater than the amount appropriated by the foreign investor as foreign capital raises overall productivity in the host country. With FDI, social returns are far greater than private returns based, inter alia, on theà following: (a) Domestic labour having a higher real wages; (b) Consumers having better choice with lower prices; (c) Host Government getting higher tax revenue; (d) Realisation of external economies of scale; (e) An alternative to labour migration from the poor country; (f) Increase in managerial ability and technical personnel; (g) Transfer of technology and innovation in products; and (h) Serving as a stimulus for additional domestic investment. However, Sir Dougall also warned that there is need for the host country to have the right additional public expenditure as foreign investors are likely to be less interested in receiving an exemption after a profit is made than in being sure of a profit in the first instance. Wassily Leontief tested the HO theory in 1951 and 1956 and found that the USA imports competing were about 30% more capital intensive than its exports. Since the USA was the most capital abundant nation, this result was the opposite of what the HO theory predicted and this became known as the Leontief paradox. Although subsequently the Leontief paradox was partly resolved in the 1980s, it led to the spring ball of modern theories of trade namely Linders thesis (Similar Preference Model or Spillover Theory), Posners Model (Technological Gap Model or Innovation -Imitation Model) in 1961 and the Product Cycle theory of Vernon in 1966. The HO model is inappropriate in explaining trade between countries with the same level of development while with the Spillover theory especially concerning manufactured goods, industrialised countries which have similar factor abundant can trade together. The Linders thesis rests on the belief that a country will export a particular commodity if it has a domestic market for the goods. In fact, domestic market is exploited first. If there are economies of scale in the domestic market, there will be a cost advantage to make export possible. Goods will be exported to countries with similar tastes and similar level of development so that trade will take place with countries of similar living standards. The technological gap theory is typical for the industrialised countries. It states that new products are likely to emerge in the market as a result of innovation. At first production is made for the domestic market. Then firms which bring forth these products have economic rent so that they have strong monopoly position. This makes it easier to tap international market. But this product in question is imitated overseas after some time period. Therefore, there is a shift in comparative advantage. So, we can say that there is an innovation-imitation process. We talk of technological gap because there is a gap between the country which invent the product and those which imitate them. The product life cycle model is an extension of the technological gap model. It states that any product moves through different stages or cycles and comparative advantage keeps shifting during these stages. There are four stages namely: Stage I New product for domestic market only Stage II If product is successful, there is overseas demand so that exportation will be possible Stage III Exports decline because overseas firms produce the goods due to innovation-imitation theory Stage IV Because of comparative advantage, the second country export the product to the first country, that is, the latter will start importing the goods which only a few years back was exporting it. Vernon (1966) explained that FDI will occur when the product enters its mature stage in the product life cycle hypothesis. Vernon (1979) re-examined his own theory and came to the conclusion that the cycle has shortened considerably whereby multinational companies are now more geographically diffused. 2.3.4 Market Imperfections Theories The suggestion that FDI is a product of market imperfection was first discussed by Hymer (1976). He also confirms that investment abroad involves high costs and risks inherent to the drawbacks faced by multinationals because they are foreign. The model was later extended by Caves (1971) and Buckley and Casson (1976) into the internationalisation theory. Hymer shifted the theory of FDI out of the neoclassical international trade theories and into industrial organization (the study of market imperfections). He also argued that there are two factors motivating FDI, namely: (i) the attempt to reduce and/or remove international competition among firms; and (ii) the desire of Multinational Corporations (MNCs) to increase their returns from the utilization of their special advantages. Foreign firms face disadvantages compared to domestic firms, mainly due to the extra costs of doing business in an alien territory and given the information on cost disadvantages, a foreign firm will engage in FDI activity only if it enjoys offsetting advantages such as superior/newer technology, better products or simply firm-level economies of scale. Buckley and Casson (1976) talked about the internalization theory of foreign direct investment. An important pre-requisite for internalisation whether being executed vertically or horizontally, is the existence of an imperfect market. They stated that there are two ways in which a firm can internalise namely by replacing a contractual relationship with unified ownership and secondly by internalising an advantage such as production knowledge through the establishment of a market where there is initially an absent of the said market. Together with the internalisation theory, there is the transaction cost theory put forward by Williamson (1975). He investigated whether a firms transactions are governed by hierarchy or the market. He identified three dimensions to this problem, namely (i) the frequency with which a transaction occurs; (ii) asset specificity; and (iii) uncertainty in the presence of uncertainty and also as uncertainty increases, it is better to govern through a hierarchy rather than through the market and vice versa. Caves (1982) also developed the rationale for horizontal integration (specialised intangible assets with low marginal costs of expansion) and vertical integration (reduction of uncertainty and building of barriers to entry). 2.3.5 The OLI Paradigm John Dunning (1988) in his Explaining International Production proposed an eclectic paradigm also known as the ownership-location-internalisation (OLI) paradigm. The OLI paradigm argued that FDI activity is determined by a composite of three sets of forces namely: Foreign firms enjoying ownership advantages in the form of better technology, product quality, or simply brand name, and other organizational knowledge that are not available to local firms. In other words, it refers to the competitive advantages which firms of one country possess over firms of another country in supplying a particular market or set of markets through product differentiation. These advantages may accrue either from the firms privileged ownership of assets or from their ability to co-ordinate these assets (common management strategy with a global scanning capacity) with other assets across national boundaries in a way that benefits them relative to their competitors;à Foreign firms can benefit from location advantages. This will make FDI activity more profitable than exporting. Examples can be: availability of cheap labour or other factors of production; market size, lower transportation cost, and trade barriers. This refers to the extent to which firms choose to locate value-adding activities outside their national jurisdictions; Foreign firms may seek internalisation advantages which arise when ownership advantages are best exploited internally rather than when offered to other firms through contractual arrangements, i.e. franchising, management contract etc. In other words, we here refer to the extent to which firms perceive it to be in their best interests to internalise foreign markets for the generation and/or use of their assets with a view to add value to them and reduce the high information costs. The significance of the eclectic paradigm, however, varies across industries, countries and firms. Another problem with the eclectic paradigm is that each of the Ownership, Location and Internalisation variables tends to be interdependent. For instance, a firms response to the independent locational variables may influence its ownership advantages and also its willingness to internalise markets. This is well known as the problem of multicollinearity among exogenous variables which can reduce the empirical validity of the model. 2.3.6 Porters Diamond Theory Porters Diamond Theory (1990) emphasises global patterns of FDI based on different country characteristics. He explained why certain countries tend to become leaders in some activities by using examples of sophisticated industries. According to him, firms that have successfully globalised their production activities have done so because of their ability to carry their home-based advantages in foreign market. Taking from the shape of a diamond, Porter (1990) maps out that there are four endogenous variables that would affect the decision of the multinational firms to compete internationally. These factors are: Factor conditions the countrys position in terms of factors of production such as infrastructure and skilled labour necessary to compete in a given industry; Demand conditions the nature of home demand for the industrys product or service; Related and supporting industries the presence or absence in the country of supplier industries and related industries that is internationally competitive; and Firm strategy, structure and rivalry the conditions in the country governing how companies are created, organized, and managed, and the nature of domestic rivalry. The role of government and chance are taken as exogenous variables in the model which can influence to a great extent any of the four endogenous variables. Government policy can either impede or help a firms progress and innovation. Chance events can come in the form of technological advancements that create a national competitive advantage for a firm. Porter (1990) stated that different dynamics may exist between the endogenous and exogenous variables, depending on what drives FDI flows namely factor-driven, innovation-driven and wealthdriven. The factor-driven and innovation-driven can be associated with continuous improvement of a countrys competitive advantages that contribute to the development of an economy. On the other hand, the wealth-driven cause can be associated with stagnation and continuous decline that perpetuate a countrys declining economy. The components identified by Porter (1990) are to some extent similar to the host-country characteristics that Dunning (1988) ou tlined in his OLI paradigm. 2.4 Determinants of FDIs Empirical Survey There has been an extensive body of empirical studies trying to explain why some countries were more successful than others in attracting FDI (Moosa Cardak 2003). This plethora of empirical studies have tested and explored the effect of a range of macroeconomic determinants including GDP, GDP growth rate, real GDP per capita, exchange rate policy, openness of the economy, financial stability and physical infrastructure among others. There have also been studies dealing with the impact of socio-political factors such as political stability, education, corruption, political freedom etc., on FDI flows (Dar et al., 2004). The empirical investigation in this paper focuses more on the macroeconomic determinants (pull factors) that will influence the FDI flows in the host country in particular Mauritius by using a time series analysis. Although there have been diverse methodologies used for the determinants of FDIs, it has also been controversial (especially when it comes to the causality effect between FDI and economic growth) so that it is difficult to have a simple model or any strong theoretical foundation to guide an empirical analysis on these issues. Kok, R and Ersoy B A in 2009 have stated that A large number of studies have been conducted to identify the determinants of FDI but no consensus has emerged, in the sense that there is no widely accepted set of explanatory variables that can be regarded as true determinants of FDI. While some parameters are comprehensively discussed and of high relevance, it remains unclear how these interact. However, the results of past studies be it panel data or t ime series analysis for a specific category of countries or regions have been employed as an imperfect but useful guide. Given the vast amount of empirical literature on the determinants of FDI especially during the last few decades, the present section will elaborate on those studies which take on board Mauritius be it as small island economies or as a regional economic community namely SADC, Sub-Saharan African countries. Also those studies will be taken on board where time series analysis have been undertaken for specific countries using almost the same key determinants for FDI as those being proposed in the model of this paper. Wint and Williams (2002), Thomas et al (2005) and Wijeweera and Mounter (2008) have been using economic factors such as the target countrys market size, income level, market growth rate, inflation rates, interest rate and current account positions to explain the determinants of FDI. They found that a positive interest rate differential assist in attracting FDI inflows as MNCs get the incentive to invest in foreign countries with positive interest rate differential barring the fact that there is no major fluctuation in the exchange rate. In the same vein, Cleeveà (2008) using a multivariate regression model for 16 Sub Saharan Countries and trying to capture economic stability through the proxy (nominal exchange rate adjusted deflator), has shown that this variable is statistically effective. Rogoff and Reinhart (2002) and Wint and Williams (2002) show that a stable country attracts more FDI implying that a low inflation environment is desirable to promote capital inflows. Ali and Guo (2005) and Choudhury and Mavrotas (2006) have indicated that there is a strong relationship between the money growth acting as a proxy for financial stability in the host country and its effects in attracting FDI. Asiedu (2006) using a panel data for 22 Sub Saharan African countries has also shown that inflation rate depicts a negatively and statistically significant effect. However, under Mhlanga et al (2010) multivariate regression model for 14 SADC countries (Southern African Development Community), the inflation rate independent variable does not have any effect as it is statistically insignificant. In terms of the importance of capturing human capital development, both Asiedu (2006) and Cleeve (2008) made use of the percentage of adult literacy and secondary school education index respectively. Both indicators have proved to be not only positive (that is higher stock of human capital will increase FDI) but also statistically significant. According to Helleiner (1998), investment incentives by host country such as tax holiday appear to play a limited role to attract the MNCs as those incentives are believed to compensate for other comparative disadvantages. On the contrary, it is generally believed that removing restrictions and providing good operating conditions will positively affect FDI inflows. This has been reinforced through Cleeve (2008) whereby he found that proxies like temporary tax incentives, tax concessions and profit repatriation when used to capture financial and economicà incentives are statistically insignificant. It goes without saying that in order to attract FDI, economic liberalization is important both internally and externally. This has been translated in several empirical studies even for SADC countries and Sub Saharan African countries from Cleeve (2008) and Mhlanga et al (2010). The famous proxy used for openness of the economy, remains the total value of exports plus imports divided by the level of national income (GDP) although Asiedu (2006) uses an openness index from the International Country Risk Guide which also proved to be positive and statistically significant. In 2008, D.Ramjee Singh, Hilton McDavid, A.Birch and Allan Wright used a linear cross-sectional model of 29 small developing countries having a population of less than 5 million to test for the statistical significance of the determinants of FDI. They found that several of the traditional variables such as infrastructure, economic growth and openness to trade do promote the flow of FDI to small developing nation states. The focus of tourism has also been highlighted in the study. Contrary to expectation the role of market size as a determinant was found to be insignificant basically as the sample taken being small economies. With regard to infrastructure per se, Asiedu (2006) and Mhlanga et al (2010) have pointed out that the proxies (number of phone lines per 1,000 inhabitants and number of landline and mobile subscribers per 1,000 inhabitants) did matter for the 22 Sub Saharan African countries and 14 SADC countries respectively. There has been previous research done with regards to the determinants of FDI inà Mauritius (Seetanah B and Rojid S; 2011) applying a reduced-form specification for a demand for inward direct investment function using dynamic framework and a differenced vector autoregressive model using data from 1990 to 2007. The variables used were size of the country, wage rate, trade/GDP, the secondary education enrolment rate and tax rate. The findings revealed that the most instrumental factors appear to be trade openness, wages and quality of labour in the country. Size of market is reported to have relatively lesser impact on FDI. The present research would use more independent variables in view of capturing a maximum variation of the model and also using data from year 1976 to 2011 which would enable the capturing of the impact of the global financial crisis of 2007/2008. There were also important policy decisions taken in the period post 2006 and the present model would try to capture the effect of those important policies. New explanatory variables would supplement the existing literature on the determinants of FDI in Mauritius and trying to use those independent variables would capture the maximum variation in the FDI inflows.
Subscribe to:
Posts (Atom)