Influence of Terror on Pakistan Stock Market Returns

Influence of Terror on Pakistan Stock Market Returns Abstract This paper examines the influence of political instability and terror on Pakistan stock market returns between 1997 and 2010. The study constructs three variables that quantify political instability and terror and examine the effect on country stock return. This study seeks to apply the Generalized Autoregressive Conditional Heteroskedasticity (GARCH) model to assess the impact of these variables on stock market returns and volatility using daily time series data for KSE. Results for KSE showed strong support for the hypothesis that bad news exerts more adverse effect on stock market volatility than good news of the same magnitude. Furthermore, terror and regime have significant negative impact while war has positive but insignificant effect on stock market volatility. JEL Classification: O40, C32. Keywords: Terror, Regime, political instability, growth, ARCH/GARCH. Introduction Many people agree that stock prices sometimes behave in bizarre ways. Markets are pretty tough and quite difficult. In the world of todays no one can negate the importance of stock markets. Stock market acts as a barometer for any countrys economy. In todays information-oriented world, news travels very fast and contagion can spread quickly and capital markets become more flexible and are absorb shocks brought on different news such as terrorism, political instability etc. Stock market of Pakistan is going through quite rough patch from many years. The change of political government and later on the terrorists attacks have badly affected the stock market and make the Pakistan Stock Market unreliable place for investment. As by seeing the overall scenario of Pakistans stock market during that time period it was not difficult for prices to follow certain patterns that support the rejection of Random Walk Hypothesis. This paper examines the impact of change in government, war and terror on economic growth in the Pakistan. Pakistan is one of those episodic-democratic countries who are facing continuous upheavals and socio-political disruptions since their inception. Military interventions could be witnessed in the political history of Pakistan. More over intervallic wars with India, strikes, antigovernment demonstrations and most importantly the ongoing war on terror have popped Pakistan to prominence on the socio-political platform. Such sociopolitical flux, terrorist attacks and other disruptions can have serious implications for stock price movement because stock prices reflect investors expectations about the future and these stock price movements on aggregate can generate a surged wave of activity. There has been an extensive work on study of stock market returns and volatility with respect to the fundamental variables and the macroeconomic variables but a diminutive work has been done so far to study the impact of socio-political factors on the stock market volatility in Pakistan. The existing literature on impact of socio-political factors on stock returns volatility is quite inadequate especially if we talk in context of Pakistani market. Masood Sergi (2008) analyzed Pakistans political risks and events that have affected the Pakistani stock market since its independence but their study chiefly covers the political events. Terrorism and strikes which have recently become the matters of intense interest and the source of unrest in the economy are the missing part there. The Karachi stock market is rapidly converting into a volatile market. If we see figure below it showed that there are high volatility during 1997 to 2010. This cannot be viewed as a positive sign for this emerging markets like Stock market of Pakistan. Though heavy fluctuations in stock prices are not an unusual phenomena and it has been observed at almost all big and small exchanges of the world. But focusing on the reasons for such fluctuations is instructive and likely to have important policy implications. The efficient market hypothesis argued that changes in stock prices are mainly dependent on the arrival of information regarding the expected returns from the stock and risk associated with that stock. (See Figure 1.1) So the purpose of our study is to examine empirically the impact of socio-political instability on Pakistani stock market. This study examines the three factors and their impact on the Pakistani stock market; the political instability due to military interventions, 1999 Kargil war, and terrorism. Literature Review A number of theoretical and empirical articles argue that these factors hinder economic growth of a country. Cutler, Poterba and Summers (1989) claimed that the sock prices move in response to the information other than about the fundamental values. They estimate the fraction of stock returns that can be accredited to various kinds of economic and non-economic events including assassinations of important political or national figures, war, invasions, raids and major policy change but their findings suggests a very small effect of non-economic news on the share price. Most of the studies have found a significant impact of political news or events on the stock market behavior. Chan Wei (1996) studied the impact of political news on the stock market volatility in Hong Kong and using GARCH-M model they found the strong evidence of the impact of political news on stock market volatility inferring that unfavorable political news is correlated to negative returns for the Hang Seng Index and vice versa. Mei Guo (1999) examined the impact of political insecurity on the financial crises in emerging markets and they observe that market volatility increased during political election and transition periods and political uncertainty could be a major contributory factor to financial crisis. Similarly Kim Mei (2001) infered through empirical analysis using GARCH(1,1) filter that the political risk affect the stock market volatility but this impact of political events or news is asymmetric, with bad news having a greater influence on volatility relative to good news. However Voth (2001) have argued that the impact of political factors in studies on German market has been over stated. He argued that the majority of events escalating political uncertainty had a minute or no effect on the value of German assets and the volatility of their returns. Instead, it was inflation that is mainly responsible for most of the variability in stock returns. He suggests that there is no direct linkage between the political factors and the stock market, however through channel it impacts. But Voth (2002) in a panel study of a set of 10 countries using panel regression confess that during great depression political risks changed dramatically over the period, and are adequate to account for a large part of the boost in stock price volatility. Beaulieu, Cosset Essaddam (2002) examined the impact of political risk in Canada on the volatility of stock returns, covering important political events in the country. Their study suggested that political news performs a significant role in the volatility of stock returns. Moreover the volatility of stock returns also depends on the degree of how much a firm is exposed to political risk i.e. the structure of its assets and the level to which there is foreign involvement. Kutan Perez (2002)Â  also found a significant impact of social and political factors on stock return volatility in their study conducted on Colombian stock market. Bautista (2003) applied Regime-switching-ARCH regression on Philippine stock returns to estimate its conditional variance and the estimated volatility was then related to major political and economic events. Their study revealed that the Philippine stock market is sensitive to radical changes in the political situation. Moreover the series of military takeover attempts during late 1980s in Philippines lead to hefty fluctuations in stock market index. Masood Sergi (2008) analyzed political risks and events that have affected the Pakistans stock markets since its foundation. They have found that Pakistans political risk carries a significant risk premium of between 7.5% and 12%. They made forecasts using Bayesian hierarchical modeling and Markov Chain Monte Carlo (MCMC) techniques and found that there is relatively high probability of occurrence of events with an average arrival rate of approximately 1.5 events per year. Many others also wrote that political instability warped the future path of investment decisions (Calvo and Drazen (1997), lessened public investment leading to a shift of government budgets from capital spending to government consumption (Darby, Li and Muscatelli (1998), and makes governments less inclined to make improvements to the legal system (Svensson (1993) Wars and unrest at the borders creates instability and panic among the investors that could affect the stock market movement at large. The affect of war has been analyzed in many studies including Cutler, Poterba and Summers (1989), Aggarwal, Incaln Leal (1999) and in Pakistan Masood Sergi (2008). Aggarwal, Incaln Leal (1999) examined the sort of events that cause large swings in volatility of emerging stock markets. For this purpose they examine various social, political and economic events both at global and domestic level to find out their explanatory power in context of the returns volatility in the emerging markets including the impact of gulf war. Though at small scale but the impact of gulf war was felt in those emerging markets. Similarly Masood Sergi (2008) found that among other factors that they studied, wars with India, 1948, 1965, 1971 and 1999 kargil war negatively influenced the Pakistani stock market. Evia et al. (2008) examined the affect of socio-political conflict in Bolivia on economic performance. Factors studied widespread during the conflicts as strikes, demonstrations, road blockades, and conventional rent-seeking. Their results showed that economic growth due to external factors is positively related to conflict while growth due to productive investment is negatively related to conflict. Terrorism is another as put that has been studied in relation to economic activity. Many studied in this distance; produced conflicting results as Becker and Murphy (2001) argue that economic performance are not much affected, because terrorist attacks usually devastate only a small portion of the overall stock of capital in a country. By contrast, Abadie and Gardeazabal (2005) repeated that terrorism shape overall economic risk in a country and lead to the economic shakiness in the country. They also conclude their study that higher level of terrorism risks results into the lower levels of foreign direct investment (FDI). Almost all studies on terrorism and its influence on stock prices limited to only on a single or few events, such as the 11 September 2001 attacks, as considered by Hon et al. (2004) Chen and Siems (2003) study. Chen Siems (2003), used event study methodology to capture the aftermath of terrorism on global capital markets. They studied on the reaction of U.S. capital markets in response to terrorist attacks. Their results showed that capital markets of US are more resilient flexible than in the past and recover quicker from terrorist attacks than other global capital markets. Their study suggests this increased market resilience to be partially explained by a stable financial sector in US that provides adequate liquidity to support market stability and reduce the spread panic. Methodology and Data Description Stock index data is taken from Karachi Stock Exchange, Yahoo Finance. This is a well known and reliable source of business information in Pakistan. The daily closing value of KSE-100 index is used for calculating the daily returns. The continuously compounded annual rate of return is used to measure the returns for the specific period as; Rt = ln (Pt / Pt-1) The closing prices of KSE-100 index for Karachi Stock Exchange are taken for the period July 2, 1997 to Oct 13, 2010. Our proxies are TERROR, a dummy variable of terrorist incidents during this period; REGIME, a dummy variable for government changes from fully democratic government to Marshal Law or democratic under such condition; a dummy variable for the period of the Kargal War in 1999. We applied regression model and Arch/Garch technique to capture the results. ARCH/GARCH Study Models This section presents the methodology of the paper. Daily data for Karachi stock markets were obtained from Yahoo finance and data for terror, kargal war and regime were obtained from South East Asia Terrorism Portal, and Different News Paper of Pakistan. Study apply ARCH/GARCH tools to see the long term relationship of these variable taking stock return as dependent variable and terror, regime and kargal war as independent variables. As aggregate uncertainty may be a function of political instability, we proceed to model uncertainty directly. It is natural to look at the conditional variance of output. Thus, we examine GARCH processes, in a more general framework than in the previous section. The model estimated here is a GARCH (1,1) process. Engle (1982) argue that in high frequency data large and small disturbance errors appear in group therefore error term variances can be shown as a function of their lagged values. He calls it Autoregressive conditional Heteroskedasticity (ARCH). As an investor or policy maker, we might be interested in investigating the returns and variance financial assets over observable period of time (conditional) rather than long run estimate of variance (unconditional). Engle (1982) shows that it is possible to describe the conditional mean and conditional variance of a financial asset using information set of previous period; Where is the return of financial asset in time t conditional on the information set at time t-1. E represents the expected value in statistics. Consider the simple model Where Where the rate of is return and are the regression parameters. A typical ARCH model can be written as follows: Conditional Mean Equation; Error Decomposition OR where ‘v is the part of variance which is homoskedastic and is the conditional variance which is Heteroskedasticity. This conditional variance can be shown as ARCH Conditional variance Equation, i.e. where and are non negative. Engle (1982) has also derived a Lagrange Multiplier (LM) based principle to test the hypothesis of. Another useful variant of ARCH methodology, proposed by Bollerslev (1986) is the generalized ARCH or GARCH model. Bollerslev (1986) argues that conditional variance in financial series is not only the function of its lagged error term but also the function of its lagged conditional variances. Therefore, GARCH (1, 1) process would be So GARCH model helps to explain the conditional variance with the help of past squared error term and conditional variance lag value. Which also means that conditional variance at time‘t would be function of long run variances and also variances conditional on past information set (short run) or observed shocks i.e. . Testing for ARCH/GARCH effects: Before estimating Arch/Garch techniques, it is first important to check for possible presence of Arch effect in order to know which model is requires the ARCH estimation instead of OLS (Ordinary Least Squire). The presence of ARCH effects in a regression model does not invalidate OLS estimation. However it implies that there is more efficient nonlinear estimator than OLS. (See Table 1.1) Obs*R-Squared is 147.26 and has a probability limit of 0.000. This clearly suggested that ARCH effect is present and presence of Heteroskedasticity suggested that ARCH/GARCH is appropriate model for this type of time series data. So we can apply ARCH/GARCH model on this data instead of ordinary least squire regression. Result of GARCH effects: The results of GARCH are presented in Table 1.3. The first column presents the regression results when we include as independent variables dummy values of the regime, terror, and war. In most of the cases, the variables enter with the anticipated signs, but not all of them are consistently significant at the 0.05 level. We can see an evidence of significant negative impact of terror, regime that show due to bomb blast in Pakistan and change in government negatively impact the country stock return in long run while insignificant positive impact of war on the country stock return. The results can further explained that stock return volatility every day is explained by approximately 71% of the previous months return volatility for Karachi stock exchange. This is significant for KSE returns. The coefficient of return innovation are statistically significant for market implying that new information arrival into the markets has significant impact on predicting next days stock market volatility. Because, the constant term in the variance equation for KSE is significant. The results of GARCH (1,1) are presented in Table 1.3 (Table 1.2) The model can be written as; Mean Equation: = 0.001188+ 0.064048* R_KSE(-1) Variance Equation: GARCH = 4.01E-05 + 0.20721*ARCH+ 0.713458 GARCH(-1) 1.21E-05*Terror + 1.93E-05*War -1.48E-05*Regime The persistence parameter for KSE Durbin-Watson stat = 1.943, which is > 1. This show a very explosive volatility in KSE returns. It also demonstrates the capability of past volatility to explain current volatility (Engle and Bollerslev, 1986) and because it is very high, the rate at which it diminishes is rather very slowly. For ACRH/GARCH, conditional standard deviation and conditional varience graph were as shown in figure 1.2 and 1.3; The GARCH coefficient is both statistically significant and conforms to expectation. This implies that past variances exert significantly positive effect on stock return volatility in KSE. On the basis of these results, it is evident that there is significant time varying volatility in Pakistan stock market returns during the sample periods. Conclusions and Recommendations In this paper, we have estimated a nonlinear GARCH model for daily stock returns volatility and terror, Kargal war and regime in Pakistan. Data for the estimation of GARCH (1,1) models was obtained from Yahoo finance and South Asia Terror Portal and news paper of Pakistan. The asymmetric effect of terror, war and regime on stock returns and volatility was investigated. Preliminary investigation into the nature of the data reveals that study had to employ ARCH/GARCH techniques for data analysis. Firstly, results show evidence of time varying volatility in stock market returns across the market and from the asymmetric model, results indicate that bad news has larger impact on stock volatility than good news in the KSE. The result for KSE showed that terror and regime has negativity impact on returns of KSE while war has positively effect, it may be due to short term period of the war. All three variable are significantly have their impact on the returns.

Dissociative Fugue Essay -- Psychology, Identity, Disorders

Dissociative Fugue Dissociation is when there is loss of connection in a person’s memory, thoughts, and sense of identity. The severity of dissociation ranges from mild dissociation a very common form seem in examples such as: daydreaming, driving a familiar route and realizing you do not remember the last several miles, or getting â€Å"lost† in a book. More severe and chronic forms are multiple personality disorder, now called dissociative identity disorder, and other dissociative disorders (Livingston, 2004). In this paper I will be focusing on Dissociative fugue. This dissociative disorder is very rare and can appear in a person suddenly and with warning. The individual travels far from home or work and leaves behind a past life. In extremely rare cases they assume a new identity. The individual experiences amnesia and does not have any conscious knowledge or understanding of why they left or how they got where they are. These â€Å"travels† can last anywhere from a few hours to several months. Fugue is derived from the Latin word fugere, meaning flight. Dissociative fugue differs from dissociative identity disorder because if a person assumes a new identity with dissociative fugue it does not coincide with other identities such as with Dissociative Identity disorder. Disabling Attributes This disorder can be very disabling because these bouts of flight come at unpredictable times. This can make it hard for an individual to keep a job if they have the chance of taking off and not remembering or knowing why. The possibility of assuming a new identity is also there making it very hard to develop strong relationships. They are viewed as unreliable employees and they do not possess the coping skills to deal with emotional ... ...s provide clear boundaries. Individuals have reported that if the support group includes individuals with complex dissociative disorders and those without have been problematic. An individual should keep this in mind when trying to find a support group right for them (Livingston, 2004). Rehabilitation Implications The outcome for individuals with dissociative fugue is good. A rehabilitation counselor should provide counseling and proper support to their client. With the proper treatment individuals with dissociative fugue can accomplish any of the same goals as an individual without a dissociative disorder. Rehabilitation counselors should also make sure clients have had the proper medical examinations and medication to treat the secondary symptoms to dissociative fugue. If all these are followed the counselor client relationship should be successful.

Appalachian Musicians And Singers And The Songs They Write :: essays research papers

Appalachian Musicians And Singers and The Songs They Write   Ã‚  Ã‚  Ã‚  Ã‚  Growing up in Appalachia and around its music has made a great impact on my life. I can remember, as if it were yesterday sitting on grandpa's front porch with my family singing along with Hillbilly songs on the radio. Along with entertaining the music eased the tensions of living a meager existence in Appalachia. By relating with these song writers and the stories in there songs we somehow find our life less tedious and more bearable. Most country and gospel Appalachian song writers find the words to there songs in the day to day experiences of there lives.   Ã‚  Ã‚  Ã‚  Ã‚  One of the most prominent and popular types of music to come out of the Appalachian region is gospel music. Writing about the religious experiences one felt at the alter or the hope of seeing a lost family member in the here after has been the subject of many Appalachian gospel song. Singers and song writers like Tennessee Ernie Ford and Ernest Tub have left us with joy in our harts and tears in our eyes. Singing and listening to songs like The Old Rugged Cross has carried over from generation to generation in Appalachia.   Ã‚  Ã‚  Ã‚  Ã‚  Another branch of Appalachian music that encircle around religion is bluegrass. One of the best known Bluegrass artists (Bill Monroe)Known also as the father of bluegrass music, dedicated a portion of every performance to a gospel bluegrass harmony number. Bluegrass became popular in the region for a number of reasons. Not the least of which was the inexpensiveness of home made instruments.(Ergood and Kuhre 189) The relatively small size made the instruments easily transported from home to home.   Ã‚  Ã‚  Ã‚  Ã‚  The variance of topics in Appalachian music can not be numbered. The subject of a song can be anything from the pine trees on the highest mountain to the cool water in the stream at the bottom of the lowest holler or any thing in between. Anything seen heard or felt might have a song written about it. Another brand of Appalachian music honky tonk music was made popular by a man named Hiram (Hank) Williams. Songs about cheating harts and Honky Tonkin might no have been popular with the churches, but they were with the Appalachian workers in the city bars that couldn't be down home with there loved ones. Hank Williams, although not mentioned in our text had a high pitched pining sound that was common among Appalachian singers. Blue grass instruments carried over into this style of Appalachian music. Hillbilly as it is referred to in slang

my statement :: essays research papers

When I first sat down to write this statement letter I had hundreds of ideas. I am not writing this letter to be a sob story of my life and the wrong choices I have made, but a statement of growth and encouragement for my future. I am a 33yr old male of mixed race (Mexican and African American). In my family education was important, my grandmother only has a 12th grade education and she had it a lot harder than me coming from Chihuahua, Mexico to the United States, so they tried to stress the importance of an education. It has taken me 12 years to realize that I need a college education, an education that seems to be slowly slipping out of my grasp because of my inability to pay for school. I am currently a student at Oakton Community College; I started with my first class last summer to see what college life is or if I could make it in school setting after all these years. I took Intro to Criminal justice, I was told to take easier class to work my way up to harder classes. I don’t want easy, easy would have been 12 yrs ago when I should have gone to college. I passed the class with an â€Å"A† grade, happy I was but not satisfied with just passing this class. I still need to see if I could work a full time job and go to school full time. Fall classes were more difficult than I thought with my success from the season, I passed with â€Å"B† and 2 â€Å"C†. This was upsetting to me, for the first time I cared about a grade I received. Passing is not good enough, I need to pass with good grades (I strive to achieve my goals)! My career goal is Law enforcement, Police Officer (State or Local), Forensic Scientist, Criminologist or Government Enforcement. Obtaining a degree in my chosen profession would allow me to open doors. The disadvantages that I have faced without a college degree has led me to many obstacles in my life. The multitude of financial obligations that I face from day to day is sometimes overwhelming. With my current employment, the future looks no better. Attending Oakton is allowing me to reach my career goals and to pursue my dreams.

Moral Obligations about Charity views of Peter Singer and John Arthur Essay

The fact that we can afford to provide for ourselves even beyond our basic needs bring an important question. Is it then our duty to provide financial assistance to those who do not have enough to provide for their own basic needs? Peter Singer, in his piece, â€Å"Famine, Affluence, and Morality† would argue that we ought to prevent bad things from happening without sacrificing something of equal importance. Here is the argument Peter Singer presents to us in standard form 1) Millions of people are suffering from hunger every day. 2) Suffering and death from hunger is bad. 3) If it is within our power to prevent something bad from happening without sacrificing anything of comparable moral importance, we ought to morally do so. 4) It is within the power of affluent people to prevent hunger by sacrificing only their luxuries, which are of lesser moral importance. However, John Arthur disagrees with Singer’s conclusion in his piece, â€Å"World Hunger and Moral Obligation: The Case against Singer† and believes that although we should help those in need, it is not imperative to do so. John Arthur’s argument in basic form looks like this: 1) Singer says that all affluent people have a moral obligation to give their money to poor people to the extent that the affluent person would be on the same level as the poor person. 2) Poor people have no positive right to our assistance, because affluent people made no contract to do so. 3) Affluent people have a negative right to their property, which weighs against their obligation. Therefore, the obligation that Singer imposes on affluent people is not as extensive as Arthur. I will analyze both sides of this argument and in the end, propose my own position on this subject. Singer’s main point as stated above is that we ought to prevent bad things from happening without having to sacrifice something of equal importance. In other words, we should give to those in poverty as long as we do not put ourselves in a position of poverty. Singer starts his argument by making the assumption that it is a bad thing when people suffer and die from the lack of food and shelter. Since this is a bad thing, we ought to do something in order to prevent these things from happening without sacrificing anything of equal moral importance to ourselves. This point essentially puts the responsibility of the well-being of all people who are in some way suffering from lack of food and shelter into the hands of those who are in a position to do something about it. The fact that it is now our responsibility makes it morally wrong to not care for these people with our financial assistance. Singer does not see the act of giving money in order to prevent something bad from happening as charity, but instead as our duty. With charity comes the moral option to not give and to spend money on luxuries. If giving to prevent bad things from happening is something that we ought to do, to not do it would be wrong. Money that would have been spent on luxuries should be sent to parts of the world that need it on the basis of their lack of food, shelter, and adequate clothing. On the other hand, John Arthur brings up a strong argument against Singer. Arthur contests that a person has a right to do with their money as they please. There is no contract between ourselves and those in need, therefore we are entitled to invoke our own rights as a justification for not giving to those in need. The interesting thing about this argument is that Arthur is not saying that it is a good thing that we ignore the needs of others, but is instead saying that we have to right to not give. Arthur thinks that we are expected to give to those in need, but we also have the right to invoke our own rights of not giving to those in need. Arthur argues that if we were to live by Singer’s moral standards by following â€Å"greater moral evil rule† then we should not only give monetary charity but also give to the extent of donating parts of our bodies to help someone from dying. He says this because if you can survive without a certain body part (like a kidney) then according to Singer you should give it to someone to save their life because the kidney is less significant than a person dying  (Arthur 473). Arthur does not agree with this idea he sees this as a person violating our negative rights to property, protesting, that it’s your body, and you have a right to it, outweighs any duty you have to help. Both Arthur and Singer agree that there are millions of people suffering from hunger everyday and that this suffering causing death is a bad thing. However Singer believes that it is our moral duty to assist the poor not a choice to do so. While Arthur believes that although we should help those in need, it is not required of us to do so. Therefore the obligation that Singer imposes on people is not as extensive as that of Arthur. As a moral person, one is morally obligated to act in a way which will bring about the greatest happiness. Whether that action is positive or negative doesn’t matter to the pain or pleasure that is produced. No distinction is necessary to the morality of the action. Pain and pleasure are still the measure of moral significance that are used to judge whether a given charity is good or bad. Then the given rules of charity are used to judge the morality of an individual’s acts of charity. Arthur argues that duty to help a stranger in need would be some sort of positive right such as an agreement or contract. However when it comes to assisting in the world hunger situation there are no such agreements or contracts between flourishing countries to assist non flourishing countries. Arthur is correct in arguing that there is something more in the terms of Singer’s argument in the case about the drowning child that if we are able to prevent something bad from happening without sacrificing something of moral significance then we have the moral duty to do it. With the example of the drowning child in the shallow pond, even though we might get our clothes muddy if we were to save the child. As a consequence, like this child case, people have an obligation to rescue strangers when they have the ability to do so that it is our moral duty to do something. Arthur argues the point that these rights as well as deserts are important parts of our moral code based on values such as fairness, justice, and respect. From Arthur’s point of view, there are two significant human rights which are â€Å"negative rights† and â€Å"positive rights†. â€Å"Negative rights†, â€Å"rights of noninterference† (473) in another word, are rights not to be interfered by  anyone such as a right not to be killed. The other rights which are also ignored are â€Å"positive rights† same as called â€Å"rights of percipience† These rights are based on agreements. As long as people have an agreement something, they have a right to receive it. In addition to rights, desert is a second form of entitlement. As an example, a hard working farmer is able to harvest a lot of wheat as a result of his great effort. On the other hand, a lazy farmer is starving because of his laziness. In this case, the hard working farmer should not have any obligation to give wheat to the lazy farmer. Thus, the farmer should consider â€Å"fairness, justice, and respect.† (474). In this case is the farmer who worked hard be obligated to give some of his harvest to the farmer who didn’t do anything to secure a harvest to provi de for him and his family. Looking at Singer’s view on charity makes me wonder, He believes that as citizens of affluent countries we are morally obligated to donate most of our wealth to the starving poor of countries unable to provide for their own with their basic needs to survive like food, shelter and adequate clothing. That theory sounds great, however I have a problem with the fact that are focusing on the welfare of the struggling poor in other countries, while we ignore the suffering of our own right here in our backyard. Yes, I said the United States of America should take care of its own first. Before we spend our precious dollars taking care of the rest of the world. Let me say I cannot fathom a world as progressive as ours and yet people are still starving and dying right here in our own backyard. But it is a reality. Billions of dollars are given to aid so many other countries. While less and less is used here to provide relief for our own who are suffering. So, what is my point you say, my point is we spend a lot of money taking care of people around the world. As a society we are generous. Everyday I listen to politicians and others pointing fingers at each other playing the blame game for our economic crisis. Blaming the Republicans, or blaming the Democrats, Blaming the rich or poor, but the fact is all the blame in the world isn’t fixing the problem. Seeing all the dollar amounts being used to fund all these different relief efforts worldwide is simply amazing. But just think how far those dollars would go if they were to keep them here in the United States and use them to help keep a family member or a neighbor from losing  their home or life. Why are we providing billions of dollars in scholarship aid to foreign students when graduates of our own high schools can’t afford a college education? Why are our religious organizations donati ng billions of dollars to provide health care and literacy programs to foreign countries when our own kids are on Medicaid and illiterate? How much money would go back into restoring our own economy and helping citizens of the United States of America if we kept our money here? Will become the nation known for letting its own people suffer while we take care of the suffering in other countries. Will we keep playing the blame game and turn our backs to the pain and suffering of the people on our own soil. If so, maybe we should change our name to â€Å"The United States Charitable Citizens for the Rest of the World.†

Panama Canal Expansion

Expansion of the Panama Canal & Heartland Barge The Panama Canal enables the ships sailing from the Pacific Ocean to the Atlantic Ocean (and vice versa) to save time and fuel by avoiding the travel around the tip of South America. The savings in time equal half of the time previously taken by ships to do the same. The size of ships that are used in shipping containers has drastically increased due to the container revolution.To enable the new and bigger ships such as Maersk Triple E Class to pass through and to increase the toll that is collected on every ship, the Panama Canal Authority has decided to undertake the expansion of the Panama canal. This event has impacted world trade and companies all over the world. As of now, the New Panamax ships with drafts of 45 ft delivering containers from Asia to the east coast of the US cannot pass through the Panama canal and therefore dock at the ports of Los Angeles and Seattle on the west coast and transfer their containers to railroad com panies to transport the goods to the east coast.But when the expected expansion commences in 2015, some of these ships would be using the canal to directly reach the east coast of the US To get a piece of this action, several ports on the east coast have undergone upgrade and increased their depth to at least 50 ft to allow the New Panamax ships to reach their container port facilities. Although the U. S. Army Corps of Engineers (USACE) itself has indicated that deepening isn’t expected to increase the volume of container traffic coming through ports, the reality is that not deepening could cost the port a significant amount of volume, relegating it to â€Å"lower tier† port status.New Panamax vessels today make up 16% of the world’s container fleet, but account for 45% of the fleet’s capacity,†Ã‚  By 2030, new Panamax vessels will account for 62% of the capacity of the world's container fleet. The potential transportation cost saving of using new P anamax size vessels to ship agricultural products to Asia, through the Panama Canal may lead to an increase in grain traffic on the Mississippi River for export at Gulf ports. The shipping draft on the lower Mississippi River has enabled operations to 45 feet.However, this requires constant monitoring due to seasonal changes in siltation loads from flooding and deposits. This prompts the need for maintenance dredging to attain operational drafts. But the limitations on the USACE's federal allocated resources is limiting their capacity to properly maintain the 12,000 miles of waterways and 240 locks in the US. Heartland Barge (HB) highly values the ability to match the volume of goods flowing upstream of the Mississippi river system, with the volume of goods flowing downstream, thereby minimizing empty back haul movements.The goods moving downstream are grains mostly Soybean and Corn headed for China and other Asian countries. The goods moving upstream are fertilizers, petroleum prod ucts, aggregates namely stone and sand, and road salt for the Midwest coming from salt mines on an island in Louisiana that is not accessible by truck or rail. With the new Panamax vessels, the opportunities for HB will be varied, such as increased loadings per vessel, the potential for larger vessel sizes to be used, decreased canal transit time, and the potential for lower transport costs overall.HB owns 275 covered and open hopper barges, most of them manufactured post 2004 making its fleet relatively younger than the average barge in the US, and has three lines of business. Investment in newer and bigger barges will give HB a competitive advantage in its Barge line services business. Most barges in the US are above 25 years old and therefore the potential demand for new barge is high. The return on barge investment is 10-12% and has considerable tax benefits, making it an attractive investment option for individuals and companies, where they buy barges as an asset and let HB tak e care of the Barge Management.The Leasing and Sales division would benefit from the sales of new barges and helping investors buy or lease the barges. The Marine Consulting division will see a rise in business as more businesses would want to take advantage of HB's end to end solutions for barge transport. Hiring MBAs as consultants and training them would give HB leverage when the demand for HB's consulting division increases in the near future. Railroads cannot economically compete with barges on many counts.Barge transport costs 40-80 cents a bushel of grain whereas railroads cost an average of $1. 2 a bushel. The rail system does not have unlimited capacity on the network, which results in competitive pressure to operate over finite capacity. Because grain moves are more seasonal, railroads prefer to move consistently transported goods to better allocate resources. The heavier rail cars for transporting big sized containers can often operate over the lighter capacity rails but only at significantly slower speeds.The threat of transit tolls in the Panama canal increasing 47% over the toll structure of the past 5 years can be countered by loading a vessel to a 45 ft draft, compared to the 39. 5 ft draft of the current Panamax vessels. The river navigation system is old and aging, and for improvement projects that have been authorized, funding has not been appropriated. Improvements needed include dredging, highly efficient cranes, improving barge loading berths, automated gates, applied tracking of equipment through optical character recognition and GPS.Waterways Council Inc. is an organization lobbying the government for these reforms through the WRDA – Water Resource Development and RIVER – Reinvest in Vital Economic Rivers and Water bodies Acts. HB should support this organization in its efforts. References: http://waterwayscouncil. org/key-issues/improve-system-reliability-through-infrastructure-maintenance/ http://waterwayscouncil. org/la test-news/improve-reliability-news/harbor-deepening-what-happens-now/ http://www. usace. army. il/Media/NewsReleases/tabid/203/Article/2000/us-army-corps-of-engineers-releases-the-us-port-and-inland-waterways-modernizat. aspx http://southeastfarmpress. com/soybeans/panama-canal-expansion-could-boost-us-soybean-industry http://www. unitedsoybean. org/wp-content/uploads/Panama-Canal-Expansion-Impact-on-US-Agriculture. pdf http://www. npr. org/2013/01/10/168950808/mississippi-blues-when-the-river-doesnt-run http://www. engineeringnews. co. za/article/panama-canal-expansion-reaches-halfway-mark-as-waterway-bids-to-sustain-position-as-key-trade-gateway-2013-03-15

Organizational Theory

There have been numerous studies regarding how the influence of technology has brought about change to the structure of an organization as well as its processes. Many of the studies have concluded that the organizational structure is strongly affected by the principal technology which the organization uses. (Volt, 2005) Technology, In simple terms, Is seen as the conversion of Inputs Into outputs using machines, equipments and processes. It Is a system based on the use of knowledge and organization, evident in physical objects for the attainment of precise goals.However, with the coming along of new technologies, as well as postmodernist and symbolic-interpretative, it has further expanded on how we think of technology to include it into the arts and social practice. This essay will look in the modernist and postmodernist perspective which will provide the different views as to how technology, organizations, management and employees are related. The modernist perspective sees ontolog y as objectivism. What this means Is that they believe In the reality which exists externally outside the Influence of humans.They see the world as something which Is not subjected to others authority, walling to be covered. They believe that technology brings about value for the organization and that technology will decide the structure of an organization. Epistemology wise, modernist see it as positivism. They have a preference towards ‘hard' data such as numbers. An assumption made would be that with the application of scientific method, it is possible to find the truth about certain events.This would then allow knowledge to best tested against the objective world. With the accumulation of knowledge, humans are than able to progress further and eventually evolve. Modernists adopt the General Systems Theory which is influenced by Mile Deuterium's structural functionalism. They are concerned with what are the factors that bring Individuals and groups together. The concept of division of labor, central to concept of social structure Is the core concept for the modernist. They believe In the quantitative methods of research.When studying organization as a whole, It must be noted that the level of analysis would be the organization and the subsystems and super system are the departments and environment respectively. The goal is to ultimately help reproduce the larger system by understanding the ‘laws' which over these systems and how an activity is being performed by the various subsystems. Modernists believe that the fulfillment of a purpose by an organization is closely related with technology to the environment. The increased improvements that technology constantly brings make it a special human venture.The example of us humans wanting to own the latest possible gadgets can be used for this instance. This brings about the creation of a market Indirectly. The advances in technology are believed to bring about advances to an organization, positively and their level of steady Improvement can be measured by Its technological advancement. Definitions of technology can be broken down Into core, high and service. Core technology simply refers to constant flow of resources that are dealt directly with the production of the intangible services which are consumed as products.Moving on, the modernist perspectives look into 3 most dominant typologies that emphasizes on how the dimensions of an organizational design is being influenced by technology. The first typology would be Joan Woodward's Industrial Organization (1965). She basically conducted tests to see if organizational principles were actually put into use. It was also shown that compatibility of companies organizing themselves with technology was commercially successful. She found out that performance were of the highest levels when technologies of mass production were put together with mechanistic forms of organization.Also, the highest level of performance was achieved when technologies dealing with small batch or continuous processing were combined with organic firms. However, one limitation of her typology was that the technologies involved in the sector of service were ignored. The second typology was James Thompson Organizations in Action (1967). Basically e suggested that the type of technology, which was different depending on the ‘degree of interdependence in the transformation process', affects the structure of an organization.He distinguished between long linked, mediating and intensive. Long linked is technologies deal with mass production and continuous processing. It is when an input is being put on one end of a long series of steps which happens in sequence which will end with the output. Mediating is technologies involved in bringing people together for exchange. Examples include those working in banks or insurance companies whose purpose of to bring customers together for exchange.Intensive technologies involve more than 1 speciali zed skill, for example, hospital emergency rooms or research labs. To put in simply, it is when there is a unique input and the end result will be a customized output. The third typology is the Charles Proper Organizational Analysis (1970). He studied the reasons why the complexities of technologies are higher than others and how it can lead to uncertainty. These uncertainties are in terms of the quality of inputs and whether they are available, and also variability involved in the transformation process.A technology with a higher level of complexity will lead to a higher amount f uncertainty. This will also lead to decisions which are less programmed and the use of discretion will be higher. There are 2 factors which will influence the complexity of technology. They are task variability and task inalienability. Task variability is the number of exceptions to standard procedures encountered in the application of given theory and task inalienability is the extent which, an exception is encountered, there are known methods to deal with it'. Hatch and Councils, 2013) These 3 typologies that have been used demonstrated how an organizational structure is affected by the different technologies. The production technologies chosen must be matched with organizational forms and also the success of an organization would be obtained if the structures and procedures are suitable to the productive technology which has been employed. The structure of an organization technology that are used for their transformation. I shall now move on to the postmodernist perspective.Ontologically, they believe that reality is merely Just an ‘illusion' which, through language and discourse, is created. ‘The world is said to be made to appear in language, discourse and artwork with no referents because there is nothing to which to refer'. Hatch and Councils, 2013) This is clearly against what the modernist perspective said. Epistemologically, post modernist believes that there ca n be no truth about reality, since there is no independence to it. The use of language is used to enforce power and social arrangements whilst organizations are merely, ‘imagined' entities.Postmodernists believe that technology can be a destructive process which can cause a change or the downfall of established organizational roles and values. They believe that technology is a form of control. An example that can be used for this statement s the British manufacturers working in the textile industry who wanted to introduce more machines but this move was greatly objected by the workers as they are afraid of the impact on their Jobs and skills if it happened. There are 3 aspects with regards to conceptions of technology by the postmodernist.Firstly would be the technologies of representation. This is basically Just the technologies involved to represent individuals and work processes. Examples would include electronic data and photographs which can all be used to control employe es. This brings about fear which the future might bring. This fear is brought about by he expected growth of ‘equivalence' which can track almost everything, from the keystroke made to the websites accessed. All this will lead to the higher possibility of online accounts being hacked into which will ultimately lead to the capturing of one's identity and codes.The second aspect is the technologies of control. This is when the value for highest level of performance achieved by the reduction of energy being expended while increasing output to its maximum capacity and is often brought about by decisions of values linked to a person or institution which are based on their contribution to efficiency. However, a disadvantage is that since integrity and fairness are not clearly in relations to efficiency, it brings about the neglecting of truth and Justice.Adding on, knowledge will be changed into a commodity by technology as the acceptable knowledge can be spread by the computer. The last aspect would be civilization. This is a hybridism kind of organization which is known to be of a techno-human' construct. This occurs when an organization is being taken over by computers or electromechanical instruments, be it in whole or Just by part. The organization is being determined not only by canines, but also by the human intervention. There are dangers involved in civilization. One of which would be technology being abused and misused.Instead of technology serving the organization which is the main point of it, organizational technology, individuals from an organization would tend to expect more from it despite the limitations of how much it can actually deliver. The social and human factors also will be inferior to the capacities technologically. Additionally, according to a French philosopher that influences post-modernism is Michel Faculty, it is power related with regards to all social, political and organization relations. The relations of power do not act acco rding to any reasonable logic or contested system.There is bound to be resistance whenever there is power involved. Employees will find way to go around the loopholes that are present in the organization. However, resistance can never lead to freedom from restraint since all social relations are in relations to power. There is no way to resist domination. Postmodernist organizations make use of surveillance mechanisms which is to control the members within the organization. This includes closed-circuit television, monitoring of computer usage and mandatory diaries.These will lead to self- surveillance since members will know that they are being monitored which will lead to dehumidifying conditions. All the points in postmodernist perspective that have been talked about draws attention to not only social, but also the historical and political creation of knowledge, humans and relations socially. This would include how every one of these will appear in the present-day organizations. W hen domination is supported, humans and organizations will be at the losing end if they overlook the construction activities by regarding the existing world as rational and neutral.Technology might be selected since it meets the necessary needs of power holders within the organization and not because of its natural superiority. The postmodernist are not all against the technology computer brings. They believe it encourages democracy and also believe it is an essential tool with regards to the economy, environment and political resistance. In conclusion, it can be seen that the modernist insights with regards to the relations between technology, organizations, management and employees are different from what the postmodernist perspective has to offer.Modernists believe that technology rings about different effects to the structure of an organization and the correct kind of productive technology employed will bring about the highest levels of performance. The post modernist on the oth er hand, sees technology as a form of power. They believe that the usage of surveillance as a form of control over its members will lead to self-surveillance. This is true to a certain extent but it also leads to a kind of dehumidifying condition since employees are then expected to take extra precaution when doing something in the workplace since their every move is being monitored.