Early childhood education Essay Example for Free

Early childhood education Essay Friedrich Wilhelm August Froebel (1782-1852) was a German educator born in Oberweisbach. He is known as the founder of â€Å"Kindergarten† and was one of the most influential educational reformers of the 19th century. Froebel had a difficult childhood. His mother died when he was still young, and his father, a pastor, and stepmother neglected to care for him. Finally, an uncle took over his care and ensured that he receive a high school education. It was there that young Froebel grew up with a love for nature and strong Christian faith, which led him to seek happiness and unity in all things. Froebel’s faith also led him to think as an educationalist. Froebel studied at the University of Jena for a short time. In 1805, while studying architecture in Frankfurt, he was persuaded to become a teacher by the model school at Frankfurt. He then studied with Pestalozzi at Yverdon, before returning to the University of Gottigen and Berlin in Germany. Froebel believed that there was something missing in Pestalozzi’s theory- the ‘spiritual mechanism’. According to Froebel, this was the basis of early childhood education. â€Å"Pestalozzi takes man existing only in appearance on earth,† he said, â€Å"but I take man in his eternal being, in his eternal existence. † (Shapiro, 1983, p. 20. ) Froebel took a break from studying to join the army for a year from 1813-1814. Afterwards, he received a position at the mineralogical museum in the University of Berlin. Two years later, he founded a school at Greisheim (which later mover to Keilau) which he called the Universal German Educational Institute. It was there that he taught his methods to other teachers. Froebel opened the first Kindergarten in the year of 1837 in Bad Blankenburg. Later, he also founded a Kindergarten training school at Liebenstein. Froebel felt that children, like plants in a garden, need to be cared for and shielded from outside influences. Froeble believed that children need to imitate a teacher’s values and morals. Therefore, teachers need to be respected, receptive, and easily approachable. Among Froebel’s subordinates, however, there were constant disputes, which he was unable to control. He encountered more problems when the Prussian government did not approve of his ideas. In 1851, an edict was issued, which forbade the establishment of Kindergartens. This decree was repealed almost 10 years later- in 1860. Froebel was not alive at that time and had no idea of the impact he left on the school system worldwide, and especially in the United States. The philosophers of his times, Johann Gottlieb Fichte (1762-1814) and Friedrich Wilhelm Schelling (1775-1854), also influenced Froebel’s educational ideas. He placed an emphasis on self-activity, physical training, and pleasant surroundings in the development of children. His most important work was the book he wrote in 1826 called Menschenerziehung (tr. The Education of Man, 1877). References: Lilley, Irene M. , (1967). Friedrich Froebel: A Selection from His Writings. Kilpatrick, William H. , (1916). Froebels Kindergarten Principles Critically Examined. Retrieved from http://www. uv. es/EBRIT/micro/micro_221_12. html Froebel, Friedrich. (1896). The Education of Man, trans. W. H. Hailman. New York: Appleton. Retrieved from http://www. answers. com/topic/friedrich-wilhelm-august-fr-bel.

Health Care Of The Elderly

Health Care Of The Elderly Geriatrics is the branch of medicine that focuses on health care of the elderly. This is the study of the aging process itself. The term comes from the Greek geron meaning old man and iatros meaning healer. Geriatrics is the branch of medicine dealing with the aged and the problems of the aging.The field of gerontology includes illness prevention and management, health maintenance,and promotion of the quality of life for the aged. The ongoing increase in the number of elder person.The experiences of aging result from interaction of physical,mental,social and cultural factors. Aging as well as the treatment of the elderly, is often determined the way elder person views the process of aging, as well as the manner in which he or she adapts to growing older. A more heterogeneous elderly population than any generation that preceded it can be expected. The majority of elderly seen in the health care setting have been diagnosed with at least 1 chronic condition. Individuals who in the 1970s would not have survived a debelitating illness, such as cancer or a castastrophic health event leki hearth attack, can now life more period of sometimes with a variety of concurrent debilitating conditions. Although age is most consistent and strongest predictor of risk for cancer and for the death from cancer, a mangement of elder cancer patient becomes complex because the choronic conditions, such as osteoarthritis, diabetes, Aging is a broad concept that includes physical changes in peoples bodies over adult life, psychologic changes in their mind and mental capacities, social pyschologic changes in they think and believe, and social changes in how they are viewed, what they expect, and what is expected of them. Aging is constantly evolving concept. Notions that biologic age is more critical than chronologic age when determing health status of the alderly are valid Aging is an individual and extremely variable process. The functional capacity of major body organs varies with advancing age. As one grows older, environmental and lifestyle factors affet the age-related functional changes in body organs GERIATRICS ASSESSMENT CARE MANAGERS A Care Plan is an outcome of a geriatric assessment, and is essentially an action plan for future care. A Care Plan lists all identified problems, suggests specific interventions or actions required and makes specific recommendations regarding resources needed to provide the necessary support services. What is geriatric assessment? A geriatric assessment is a comprehensive evaluation designed to optimize an older persons ability to enjoy good health, improve their overall quality of life, reduce the need for hospitalization and/or institutionalization, and enable them to live independently for as l ong as possible. An assessment consists of the following steps: An examination of the older persons current status in terms of: Their physical, mental, and psycho-social health Their ability to function well and to independently perform the basic activities of daily living such as dressing, bathing meal preparation, medication management, etc. Their living arrangements, their social network, and their access to support services. An identification of current problems or anticipated future problems in any of these areas. The development of a comprehensive Care Plan which addresses all problems identified, suggests specific interventions or actions required, and makes specific recommendations regarding resources needed to provide the necessary support services. The management of a successful linkage between these resources and the older person and that persons family so that provision of the necessary services is assured. An ongoing monitoring of the extent to which this linkage has, or has not, addressed the problems identified, and the modification of the Care Plan as needed. When is a geriatric assessment needed? A request for a geriatric assessment would be appropriate when there are persistent or intermittent symptoms such as: memory loss, confusion, or other signs of possible dementia. DEMENTIA : Global impairment of intellectual function (cognition) interfering with social and occupational activities. Often, what looks like Alzheimers or dementia can be the result of medication interactions or other medical or psychiatric problems. Because of the thoroughness of the geriatric assessment, it is one of the best ways to determine what the actual problem and cause is or is not. Who performs a geriatric assessment? A geriatric assessment can be done in many different settings such as: a hospital, a nursing home, an outpatient clinic, a physicians office or the patients home. It is an assessment that is comprehensive in scope, involving a complete review of the current status of the older person in all of its complex dimensions, and because it is so comprehensive, it can only be successfully conducted by a multi-disciplinary team of experts. This team might include: physicians, ancillary personnel, social workers, physical and/or occupational therapists, dieticians, psychologists, pharmacists, and geriatric nurse practitioners. You can request a referral for a geriatric assessment from a primary care physician. Also, check with any large hospital or university to see whether they have a geriatric assessment unit. Geriatric care managers A geriatric care manager (GCM) is a professional with specialized knowledge and expertise in senior care issues. Ideally, a GCM holds an advanced degree in gerontology, social work, psychology, nursing, or a related health and human services field. Sometimes called case managers, elder care managers, service coordinators or care coordinators, GCMs are individuals who evaluate your situation, identify solutions, and work with you to design a plan for maximizing your elders independence and well being. Geriatric care management usually involves an in-depth assessment, developing a care plan, arranging for services, and following up or monitoring care. While you arent obligated to implement any part of the suggested care plan, geriatric care managers often suggest potential alternatives you might not have considered, due to their experience and familiarity with community resources. They can also make sure your loved one receives the best possible care and any benefits to which they are entitled. Help provided by geriatric care managers Geriatric care managers facilitate the care selection process for family members who live at a distance from their elderly relatives, as well as for those who live nearby but do not know how to tap into the appropriate local services. You can hire a care manager for a single, specific task, such as helping you find a daily caregiver, or to oversee the entire caregiving process. Geriatric care managers can help families or seniors who are: new to elder care or uncomfortable with elder care decision-making; having difficulty with any aspect of elder care; faced with a sudden decision or major change, such as a health crisis or a change of residence; dealing with a complex situation such as a psychiatric, cognitive, health, legal, or social issue. In addition to helping seniors and their families directly, geriatric care managers can act as your informed connection with a range of other professionals who are part of your elder care network, including any of the following service providers: Attorneys or trust officers. A care manager can serve as both elder advocate and intermediary with financial and legal advisors. The GCM is often a good source of referrals if a family needs services from these professionals. Physicians. The GCM is an ideal liaison between doctors and other health professionals, and the elder patient and family members. Social workers. It is useful for hospital and nursing home social workers and discharge planners to know that their senior patient will have someone to coordinate their care and assist them on a long-term basis. Home care companies. The GCM will know local agencies and be able to explain options, costs, and oversight of home care workers. The care manager can also assist in dealing with patients social issues, help link to other community resources, and suggest possible placement options. Residential facilities. The GCM can help identify types of care facilities and assist you in selecting an appropriate one for your situation. The GCM may also be able to streamline the transition into or out of a senior community, for both the elderly resident, family members and staff. Finding a geriatric care manager In addition to the many References and resources available, a good place to start your search for a geriatric care manager is with your family physician. Other sources for referrals include: local hospitals and health maintenance organizations senior or family service organizations senior centers religious affiliations Medicaid offices private care management companies While geriatric care managers are frequently licensed by the state within their respective fields of expertise, there are no state or national regulations for professional care managers per se. For this reason, anyone can use the title case or care manager. Membership in a professional organization and/or certification in care management are good indicators of appropriate background. The National Association of Professional Geriatric Care Managers recognizes the following designations for a Certified Care Manager: CMC, CCM, C-ASWCM and C-SWCM. Each of these requires testing and continuing education. Geriatrics syndroms Dementia, Delirium, Urinary Incontinence, Osteoporosis, Falls/ Gait Disorders, Decubitus Ulcers, Sleep Disorders, Failure to Thrive Organ specific disease/syndrome Ear, Eye, Cardiovascular, Musculoskeletal, Neurological, Communicable Diseases, Respiratory, Oral, Gastrointestinal, Endocrinological, Sexual Dysfunction and Gynecology, Hematology and Oncology, Kidney/Prostate, Skin Diseases Geriatric psychiatry Mood Disorders, Anxiety Disorders, Personality Disorders, Substance Related Disorders, Memory Disorders (non-dementia) Patient care Geriatric Assessment, Hospitalization, Emergency Medical Services, Surgical Procedures, Long-Term Care, Preventive Health Services, Rehabilitation, Pain Management/ Palliative Care Aging Age Distribution/Demography, Basic Sciences, Pharmacology/ Polypharmacy Patient care of the elderly Tips for working with the eldery patient Take time to edudcate the patient and his or her family. Speak lower and closer treat the patient with dignity and respect.Give the patient time to rest between projections and procedures. Avoid adhesive tape: elderly skin thin and fragile. Provide arm blankets in cold examination rooms. Use table pads and hand nails. Always access the patients medical history before contrast media is administered. Patient and family education Educating all patient, especially the elderly ones, about imaging procedures is crucial to obtain their confindence abd compliance. More time with elderly patient may be necessary to accommodate their decreased ability is rapidly process information. The majority of elderly have been diagnosed with at least one chronic illness.They typically arrive at the clinical imaging environment with the natural anxiety because they are like to have lilttle knowledge of the procedure or highly technical modalities employed for their procedure. Moreover, a fear concerning consequences resulting from the examination exacerbates their increased level of anxiety. Taking time to educate patient and their family or signification caregivers in their support system about the procedures makes of a less stressfull experiences and improved patient compliances and satisfaction. Communication Good communication and listening skills create a connection between the radiographer and his or her patient. Older people are unique and should be treated with dignity and respects. Each elderly person is a wealth of cultural and historical knowledge that is turn becomes a learning experiences for the radiographer. If it is a evident that the patient cannot hear or understand the verbal directions. It is appropriate to speak lower and closer. Background noise can be disrupting to an older person and should be eliminated of possible when giving precise instructions. Giving instruction individual gives the elder person time to process a request. An empathetic, warm attitude and approach to the geriatric patient will result in a trusting and compliant patient. Transportation and lifting Balance and coordination of the elderly patient can be affected by normal aging changes. Their anxiety about falling can be diminished by assistance in out of a wheelchair and to and from the examination table. Many elderly patient have decreased height perception resulting from some degree of vision impairment. Hesitition of the elderly person may be due to previous falls. Assiting an older patient when there is need to step up or down throughout the procedure is more than a reassuring gesture. Preventing opportunities for falls is a necessity for the radiographer. The elderly patient will often experiences vertigo and dizziness when going from a recumbent postion to a sitting position. Giving the patient time to test between position will mitigate these disturbing, frightening, and uncomfortable sensations. The use of table handgrips and proper assistance from the radiographer creates a sense of security for the elderly patient. A sense of security will result in a compliant and tr usting patient throughtout the imaging procedure. Skin care Acute age-related changes in the skin will cause it to become thin and fragile.The skin becomes more susceptible to bruising, tears, abrasion, and blisters. All health care professional should use caution in turning and holding the elderly patient.Excessive pressure on the skin will cause it to break and tear .Adhesive tape should be avoided because it can be irritating and can easily tear the skin of an older person. The loss of fat and makes it painfull for the elder patient to lie in a hard surface and can increase the possibility developing ulceration. Decubitus ulcers, or pressure sores, are commonly seen in bedridden people or those will decreased mobality.Bony areas such as the heels, angkle, elbow and the lateral hips are frequent side for pressure sores. A decubitus ulcer can develop in 1 to 2 hours. Almost with out exception, table use for imaging procedures are hard surface and cannot be avoided.However the use of table pad can reduce the friction between the hard surface of the table and the patient fragile skin. Sponges,Blankets and the positioning aids will make the procedures much more bearable and comfortable for the elderly patient.Because skin plays a critiscal role in maintaining body temperature, the increasingly thinning process associated with aging skin renders the patient less able to retain normal body heat. Thus the regulation of body temperature of the elderly person varies from that to a younger person. To prevent hypotamia in room where the ambient ier temperature is comfortable for the radiographer, it may be essential to provide blankets for the elderly patient. Contrast administration Because of age related changes in kidney and liver function, only the amount, the type of contrast media is varied when performing radiographic procedures on the elderly patient. The number of functioning nephrons in the kidneys steadily decreases from middle the throughout the life span. Compromised kidney function contributes to the elderly patient being more prone to electrolcyte and fluid imbalance. This can create life-threatening consequences. They are also more suspectible to the effect of dehydration because of diabetes and decreased renal or adrenal function. The decision if type and amount of contrat media used for the geriatric patient usually follow some sprt of routine protocol. Assessment for contrast agent administration accomplished by the imaging technologist must include age and history of liver, kidney or thyroid disease; history of hypersensitivity reactions and previous reaction to medications or contrast agent ; sensitivity to asprin; over the-counter and prescription drug history including acetotaminophen (Tylenol); and history of hypertension. The imaging technologist must be selective in locating an appropriate vein for contrast administration on the elderly patient. They should consider the location and condition of the vein, decrease intergrity of the skin, and the duration of the theraphy.Thin superficial veins, repeatedly used veins,and veins located area where the skin is bruised or scarred should be avoided. Assess the patient for any swallowing impairments, which could lead to difficulties with drinking liquid contrast agents. The patient should be instructed to drink slowly to avoid choking, and an upright position will help prevent aspiration. The Radiographers Role The role of radiographers is no different than that of all other health professionals.The whole person must be treated, not just the manifested symptoms of an illness or injury. Medical imaging and therapeutic procedures reflect the impact of ongoing systemic aging in documentable and visual forms. Adapting procedures to accommodate disablilities and diseases of geriatric patient is a critical responsibility and a challenge based almost exclusively on the radiographers knowledge, abilities and skills. An understanding of the physiology and pathlogy of aging, in addition to an awareness of the social, physiologic, congnitive and economic aspects of aging, are required to meet the need of elderly population. Condition typically associated with elderly patient invariably requires adaptations or modifications of routine imaging procedures. The radiographers must be able to differentiate between age-related changes and disease processes. Production of diagnostic images requiring professio nal decision making to compensate for physiologic changes, while maintaining the campliances,safety and comfort of the patient, is the foundation of the contract between the elderly patient and the radiographers. Radiographic positioning for geriatric patient The preceding discussion and understanding of the physical,cognitive,and physchology effect on aging can help radiographers adapt the positioning challenges of the geriatric patient.In some cases routine examination need to be modified to accommodate the limitation,safety and comfort of the patient.Communicating clear instruction with the patient is important.The following discussion addresses positioning suggestion for various structures. Chest The positioning of choice of the chest radiography is the upright positions, however the elderly patient may not able to stand without assistance for this examination. The tradisional posterioranterior (PA) position as to have the back of hand on hips. This may difficult for someone with ampaired balanced and flexiblelity. The radiographer can allow the patient to wrap his or her arm around the chest stand as a means of support and security. The patient may not able to maintain his or her arms over the head for the lateral projection of the chest.Provide extra security and stability while moving the arms up and forward. When the patient cannot stand, the examination may be done seated in whellchair, but some issue will be effect the radiographic quality. First the radiologist need to be aware that the radiograph is an anterior-posterior (AP) instead of a PA projection, which may make obscure the lung bases, in a sitting position, respiration may be instructed on the importance of a deep inspiration. Positioning of the image receptor for the kyphotic patient should be higher than normal because the shoulder and apices are in a higher position. Radiographic landmark may change with age and the centering may need to be lower if the patient is extremely kyphotic. When positioning the patient for the sitting lateral chest projection.The radiographer should place large sponge behind the patient to lean hind or her forward. CHEST (Portable) Exam Rationale: Cassette size: 35ÃÆ'-43cm Non-grid 72 kVp, 6 mAs AP projection (upright or supine) Spine Radiographic spine examination may be painful for the patient suffering from osteoporosis that is lying on the bucky table. Positioning aids such as radiolucent, sponges, sandbags, and a mattress may be used as long as the quality of the images is not compromised. Performing upright radiographic examination may also be appropriate if a patient can safety tolerate this position. Performing upright radiographic examination may also be appropriate if a patient can safely tolerate this position. The combination of cervical lardosis and thoracic kyphosis can make positioning and visualization of the cervical projection can be done with the patient standing, sitting, or lying supine. The AP projection in the sitting position may not visualize the upper cervical vertebrae because the chin may abscure this anatomy. In the supine position the head may not reach the table and result in magnification. The AP and openmouth projection are difficult to do on a wheelchair. The thoracic and lumbar spines are sites for compression fractures. The use of positioning blocks may be necessary ho help the patient remain in position. For the lateral projection, a lead bloker or shield behind the spine should be used to absorb as much scatter radiation as possible. Pelvis/Hip Osteoarthiritis, osteoprosis and injuries as the result of falls contribute to hip pathologies. A common fracture in the elderly is the femoral neck. An AP projection of the pelvis should be done to examine the hip. If the indication is trauma, the radiographers should not attempt to rotate the limbs. The second view taken should be cross-table lateral of the effected hip. If hip pain is the indication, assist the patient to internal rotation of the legs with use of sandbags if necessary. Upper Extremity Positioning the geriatric patient for projection of the upper extremities can present its own challenges. Often the upper extremities have limited flexiblelity and mobality. A cerebrovascular accident or stroke may cause contractures of the affected limb, Contractures of the affected limb, Contracted limbs cannot be forced into position, and cross-table views may need to be done. The inability of the patient to move his or her limbs should not be interpreted os a lack of cooperation. Supinated is often a problems in patient with constructures, fracture and paralysis. The routine AP and lateral projections can be supported with the use of sponges, sanbags, and blocks to raise and support the extremities being image. The shoulder is also a site of decreased mobality, dislocation, and fratures.The therapist should assess how much movement before the patient can do before attempting to move the arm. The use of finger sponges may also help with the contractures if the finger. Lower extremity The lower extremities may have limited flexibility and mobality. The ability to dorsiflex the ankle may be reduced as a result of neurologi disorder. Imaging on the x-ray table may need to be modified when a patient cannot turn on his or her side. Flexion of the knee may be impaired and require a cross-table lateral projection. If a tangential projection of the pattela, such as the settegast method, is necessary and the patient can turn on his or her side, place the image receptor superior to the knee and direct the central ray perpendicular throught the pattela-femoral joint. Projection of the feet and ankles may be obtained with the patient sititng in the whellchair. The use of positioning sponges and sanbags support and maintain the position of the body part being imaged. Technical Factors. Exposure factors also need to be taken into considerarion when image the geriatric patient. The loss of bone mass, as well as atrophy of tissue, often requires a lower kilovoltage (kVp) to maintain sufficient contrast. kVp also a factor in chest radiographs when there may be a large heart and pleural fluid to penetrate. Patient with emphysema require a reduction in technical factors to prevent overexpose of the lungs fields. Patient assessment can help with the appropriate exposure adjustment. Time may also be a major factor. Geriatric patient may have problems maintaining the positions necessary for the examinations. A short exposure time will help reduce any voluntary and involuntarymotion and breathing. Ensure that the geriatric patient clearly hears and understands the breathing instructions. Conclusion The imaging professional will continue to see a changes in the health care delivery system with the dramatic shift in the population of person older than age 65. This shift in the general population is resulting in an ongoing increase in the number of medical imaging procedures performed on elderly patient. Demographic and social effect on aging determine the way which the eldely adapt to and view the process of aging. An individuals family size and perceptions of aging, economic resources, gender, race, athnicity, social class, and the availability and delivery of health care will affect the quality of the aging experiences. Biological age will be much more critical than chronologic aging when determining the health status of the elderly. Healthier lifestyles and advancement in medical treatment will create a generation of successfully aging adults, which in turn should decrease the negative stereotypes of the elderly person. Attitude of all health care professionals, whether positi ve or negative, will affect the care provided to the growing elderly population. Education about the mental and physiologic alteration associated with aging, along with the cultural, economic, and social influences accompanying aging, enables the radiographers to adapt imaging and therapeutic procedures to the elderly patients disablities resulting from age-related changes. The human body undergoes a multiplicity of physiologic changes and failure in all organ systems.the aging experiences is affected by heredity, lifestyle, choices, physical health, and attitude making it highly individualized. No individuals agign process is predictable and is never exactly the same as that of any other individuals. Radiologic technologist must use their knowledge.abilities and skills to adjust imaging procedures to accommodate for disabilities and disease encountered with geriatric patients. Safety and comfort of the patient is essential in maintaining compliances throughtout imaging procedures. Implementation of skills such as communication, listening, sensitivity, and empathy, all lead patient compliances. Knowledges of age-related changes and disease process will anchance the radiographers ability to provided diagnostic imformation and treatment when providing care that meets the needs if tge increasing elderly patient population. GERIATRICS

Link between Household Debt and Savings

Link between Household Debt and Savings Many analysts and business executives are becoming apprehensive with the recent rises in the consumer debt burden, defined as the level of consumer debt relative to ability to repay which may predict an economic growth slowdown. A higher debt reduces the credit worthiness of households who would then experience financial anguish caused by unfavourable economic shock, such as the loss of a job or large uninsured medical expenses. In the event of this situation, they would be less disposed to spend on consumer goods, particularly big ticket items such as automobiles and home computers. Consequently, the reduction in consumer spending would hurt economic growth as firms cut back on the production of consumer goods and laid off workers. Households have spent in excess of income, in part because increased house prices have led to increased household wealth. The rise in house prices reflects an adjustment to sustained low inflation and interest rates, among other factors. However, activity in the housing market cannot be sustained at the pace seen in recent years. As the housing market cools, growth in consumer spending should ease and household saving rise, resulting in a tendency for the current account deficit to fall, everything else equal. The increase in household debt also partly reflects the removal of government controls of the financial system over the past two decades. Based on the results of empirical works of many authors, most studies favour the hypothesis that the causality is from economic growth rate to growth rate of savings. Based on the empirical results, the main conclusion of this study is that income class of a country does play an important role in determining the direction of causality. A rising consumer debt burden also might predict future activities in broad methods of economic activity, such as real gross domestic product. A decline in consumer spending on durable goods would lower real GDP growth because such spending is a large constituent of real GDP. 1.2 Objectives and Organisation of the dissertation Many tests have been carried out by many authors throughout the world to see if there is a link between household debt, household savings and economic growth and hence, analyse its impact on the discussed variables. A panel cross country analysis has been carried out on 25 countries to determine how household savings and debt may act as a deterrent for economic growth. Chapter 2 reviews the literature and empirical evidence pertaining to the works of various authors concerning economic growth, household debt and household savings. The next chapter deals with the review of variables of interest to us, which will be used in the empirical testing part, hence, the household savings as a proportion of disposable income, household debt as a proportion of GDP per capita, growth rate of Real GDP per capita, consumption share of GDP per capita, price level of GDP, investment share of GDP per capita, interest on savings will be scrutinized in the chapter. In Chapter 4, the Haussman tests have been mostly used to predict the impact of these independent and exogenous variables on the dependent variable of economic growth. Finally in Chapter 5, we conclude on the subject and make some policy recommendation and alongside cite some limitations of the work carried out. 2.1 THEORETICAL LITERATURE When there is a positive change in the level of production of a countrys goods and services over a certain point in time, it is referred to as economic growth. It is also influenced by many factors but one of the pinnacles of economic history is the impact household saving and debt has on economic growth. Most working papers and journal articles on cross countries studies assume a positive relationship between household saving and economic growth and an adverse relationship between consumer debt and economic growth. The difference between a households disposable incomes (primarily wages obtained, proceeds of the self-employed and net property returns) and its consumption (spending on products) is known as household saving. When the household saving is divided by household disposable income, the household savings rate is computed. When a household uses more than it obtains as expected income and funds some of the spending through credit (growing debt), through returns coming from the sale of resources, or by making cash and deposits, there is usually a negative savings rate. These discrepancies are fairly due to institutional distinctions between countries. These include the degree to which old-age pensions are financed by government rather than through personal savings, and the level to which governments offer insurance against sickness and unemployment. The age composition of the population is also significant, as the elderly tend to run down financial assets obtained during their working life. This implies that a country with an ageing population will generally have a low household saving rate. The conformist view is that savings contribute to higher investment and hence higher GDP growth in the short run (Bacha, 1990; DeGregorio, 1992; Jappelli and Pagano,1994). The central idea of Lewiss (1955) traditional development theory was that increasing savings would accelerate growth. Kaldor (1956) and Samuelson and Modigliani (1966) studied how different savings behaviors induced growth. On the other hand, many recent studies have concluded that economic growth contributes to savings (Sinha and Sinha, 1998; Salz, 1999;Anoruo and Ahmad, 2001). Over the last 10-15 years, household saving rates have increased in Austria, Germany and Sweden and remained stable in Belgium, France and Switzerland. A downward trend over the same period has occurred in Canada, Italy, Japan, Korea, Poland and the United States. (OECD (2010), National Accounts of OECD Countries, OECD, Paris) The main factors contributing to differences among countries are listed below: The income effect: in general higher income leads to a higher saving rate; The wealth effect: profits or losses on financial and non-financial assets and liabilities affect built up wealth, and thus probably expenditure, but not on income. Higher wealth may then lower the saving rate; Credit facilities: in countries (e.g. UK and US) where consumption credit was easier to finance, saving rates may be comparatively lower; Institutional factors such as differences in social security schemes, especially pension schemes and the tax system; The proportion of own-account entrepreneurs and small unincorporated enterprises, within the household sector, because producers may have a different saving behaviour; Households expectations as regards the future economic situation; Cultural and social factors. Hondroyiannis (2004) analyses the long term and short term causal factors of aggregate private savings in Greece using data for the time frame of 1961-2000. By considering the financial and demographic advances during this phase, the long run savings utility which is susceptible to real interest rate, public funds, liquidity, old dependency ratio and fertility changes, is approximated on the foundation of an absolute life-cycle hypothesis. The significance of short-run divergences is obtained using vector error-correction model estimation. The empirical evidence proposes the continuation of a stable long-run savings function in Greece both in the long- and short-run periods and the policy inferences of such an association are accessible. According to Barba and Pivetti (2008), rising household debt in USA made low wages and increasing aggregate demand to arise simultaneously. In the USA, according to the figures of the Federal Reserve Board, consumer credit outstanding reached 25% of disposable personal income (DPI) in 2006. This was the peak of an upward trend that has characterised the period since the first half of the 1980s, following 15 years during which the consumer credit-income ratio averaged around 18%. Increasing household debt in developed countries like USA has been mostly due to the noticeable fall in household savings and this had an adverse effect on economic growth. Salotti (2009) claims that the current account is inclined by changes in US private savings which aid to generate and maintain world imbalances. A panel of 18 developed countries for the time dimension of 1980-2005 is used to check this claim by examining the components of total household savings. They merge two lines of literature: the first line from consumer theory, bearing in mind particularly the `wealth effect, the second line from aggregate private savings theory. Unit root and cointegration tests are performed to evaluate the most suited method for estimation of the long run savings function and to derive the cointegrating relationship. The group means FMOLS is exercised to approximate the model. The empirical evidence goes in line with the theory where a rise in wealth should adversely affect the household savings. In addition, when significant descriptive variables, such as national savings and populace dependence ratios, are incorporated in the model, material wealth becom es the only type of wealth to (inadequately and negatively) control household savings in developed countries. Howitt, Agnion, Comin and Tecu (2009) wanted to test if a country can grow more rapidly by saving further as they believe that household saving is of deep concern as it allows entrepreneurs to undertake their business and also reducing the agency cost that usually acts a hindrance for foreign investors. Since domestic saving counts for improvement, and consequently growth, it thus allows the home industrialist to put equity into this joint enterprise, which reduces an organization setback that would else discourage the foreign shareholder from contributing. In rich countries, domestic entrepreneurs are already known with limit know-how and consequently do not need to draw foreign outlay for investment, so domestic saving is not important for growth. The higher the household savings and the lower the household debt a country has, the more economic growth it can at least forecast to make. The finding is based on a cross-country non-overlapping panel over the period from 1960 to 2000. T hey use a sample of 118 countries, all those for which there exists data on per-worker GDP and on the saving rate. The cross-country regression shows that lagged savings is positively related with productivity growth in poor countries but not in rich countries. 2.0 EMPIRICAL EVIDENCE Empirical evidence deals mainly with the previous works of various authors all around the world. There have been many works carried out by different authors and they reached certain conclusions which may be further developed and their results vary among the countries. The first case considered is on the United States of America (USA) and then they further scrutinise what happened in the developed and emerging countries. 2.1 STUDIES ON THE USA As noted in Thomas and Towe (1996), research into household saving/consumption behaviour in recent years has inclined to centre on probing for long-run relationships between saving (or consumption) and selected macroeconomic variables. In large part, this shows the fact that the data involved have been found to be non-stationary. This implies that conventional statistical methods cannot be used to test relationships between movements in the savings rate and other (non stationary) macro variables. This approach also implies that short-run movements in the savings rate may be driven by deviations from the long-run relationship between saving and its fundamental determinants. Callen and Thimann (1997) studied the empirical determinants of household saving in USA using cross sectional and panel data from 21 OECD countries for 1975-95.) They find that household saving fell from 13% during 1975-81 to only 11% in 1982-89 but it has then stayed stable in general. Variables that capture the structure of the tax system and the financing and generosity of the social security and welfare system are added to the set of potential explanatory variables. The results indicate that there is an central role for public and corporate saving, growth, and demographics in controlling household saving, while some role is also established for inflation, unemployment, the real interest rate, and financial deregulation. The results also propose that the tax and the social security and welfare systems have an important impact on household saving. Bà ©rubà © and Cà ´tà © (2000) examine the structural factors of the household savings rate in Canada over the previous 30 years, using co integration techniques. The main result is that the real interest rate, expected inà ¯Ã‚ ¬Ã¢â‚¬Å¡ation, the ratio of the all-government à ¯Ã‚ ¬Ã‚ scal balances to nominal GDP, and the ratio of household net worth to personal disposable income are the most significant causal factors of the trend in the personal savings rate, as calculated in the National Income and Expenditure Accounts (NIEA). The outcomes also recommend that the fast fall in the NIEA personal savings rate in current years mainly shows a change in the trend constituent of the savings rate, rather than a temporary different approach from the trend. Tipett (2010) uses many methodological approaches and draws on longitudinal data from the National Longitudinal Survey of Youth 1979 and also uses multilevel logistic regressions to investigate the relationship between the hypothesized mechanisms and the probability of holding non-collateralized debt. Analysis of Survey of Consumer Finance data shows that the amount of household debt increased faster than household asset increases (see also Bucks, Kennickell, Moore, Fries, and Neal 2006; Kennickell 2009), and Keister (2000) shows that overall wealth has been growing at the same time that the percentage of households with zero or negative net worth has also been rising. 2.2 STUDIES ON DEVELOPED ECONOMIES Carroll and Weil (1994) present Granger-causality tests for 38 countries for which they have fine data, and show that increases in growth radically head increases in saving. Dekle (1993) presents comparable Granger causality regressions for a group of fast-growing countries and finds that growth positively Granger-causes saving in every country in his sample. Edwards (1995) looked at data from a panel of 36 countries over the period 1970-92. Using lagged population growth, openness, political instability, and other lagged variables as instruments, he concludes that the rate of output growth has an important, positive effect on saving. Andersson (1999) believes that the worldly interdependence between saving and output has been measured in recent empirical studies which obliged some authors to question the conventional idea of a causal chain where saving precedes growth via capital accumulation. As divergent to the previous studies, which have mostly used panel-estimation processes, the tests of causal chains are performed in time-series sets. Saving and GDP are approximated in bivariate vector autoregressive or vector error-correction models for Sweden, UK, and USA, and tests of Granger non-causality are executed within the estimated systems. The core results shows that the causal chains linking saving and output vary across countries, and also that causality linked with amendments to long-run dealings might go in diverse directions than causality associated with short-term instabilities. Jappelli and Padula (2007) reconsidered savings inclinations in Italy, summarizing existing empirical evidence on Italians motives to save, relying on macroeconomic indicators as well as on data drawn from the Bank of Italys Survey of Household Income and Wealth from 1984 to 2004. The macroeconomic data indicate that households saving has fallen considerably, although Italy continues to class above most other countries in terms of saving. The microeconomic data show a strong correlation between the propensity to save and the level of current income, as well as a strong correlation between income and indebtedness. International panel data put forward that saving is robustly linked with the growth rate of income, and that saving changes parallel growth change, as shown by Attanasio, Picci and Scorcu (2000) using the 150 countries of the World Bank Saving Database. 2.3 STUDIES ON EMERGING MARKETS Emerging markets are economies which are currently in the process of fast growth and industrialisation. There are at present 28 emerging markets in the world with the economies of China and India being considered certainly as the two largest. New conditions were surfaced in recent years to portray the largest developing countries such as  BRIC  standing for  Brazil,  Russia,  India, and China. The relationship between savings and economic growth has received increased notice in recent years especially in developed and emerging economies [see Bacha (1990), DeGregorio (1992), Levine and Renelt (1992), and Jappelli and Pagano (1994)]. This might not be distinct to the central foundation of Lewiss (1955) traditional development theory that increasing savings would accelerate economic growth. Research efforts by Kaldor (1956) and Samuelson and Modigliani (1966) examined how different savings behaviours would induce economic growth. Caroll and Weil (1994) used five year averages of the economic growth rate and savings for OECD countries and found that economic growth Granger caused savings. However, the reverse was obtained when dummies were included in their estimation. Using Granger causality tests, findings by Sinha and Sinha (1998) and Sinha (1999) found that economic growth rate Granger caused the savings growth rate for Mexico and Sri Lanka respectively. Jappelli, Tullio and Marco Pagano (1994) test whether the measures of liquidity constraints help to explain the international differences in national saving rates, as forecasted by their model. They also test an outcome of that model, namely that the effect of growth on saving is greater where liquidity constraints are more determined. The data cover a panel of 19 countries (all the main OECD countries are included) and are drawn from Modigliani [1990]. Observations are averages of annual data for three periods: 1960-1970, 1971-1980, and 1981-1987). Findings show that the two variables are negatively linked (the correlation coefficient for the entire sample is -0.55). They have empirically measured the soundness of three propositions, namely that liquidity constraints on households raise the saving rate, strengthen the effect of growth on saving, and promote productivity growth in models in which growth is endogenous. Using cross section data between 1960 and 1997 and Granger causality methodology, Anoruo and Ahmadi (2001) observed the causal relationships between the growth rate of domestic savings and economic growth for seven African countries -namely Congo, Cote dIvoire, Ghana, Kenya, Nigeria, South Africa and Zambia. Their studies established that savings are co-integrated in all of the countries except for Nigeria and that economic growth Granger-causes the growth rate of domestic savings for all the countries considered except Congo where reverse causality was obtained. Matos (2002) used among other parameters, the ratio of residents funds deposited in the financial system to aggregate monetary asset M2 (1947-2000) as a proxy of financial development, empirical tests support the view that it is vital to maintain the publics confidence in domestic financial assets to improve GDP growth prospects. This ratio may reflect an intangible asset of the financial intermediaries, i.e. the general publics confidence that contracts between customers. Kwack and Lee (2005) investigate the extent to which income growth and uncertainty and demographic factors affect the domestic real saving rate in Korea. They test an extended life cycle hypothesis and demography hypothesis with Korean time series data from 1975 to 2002. The results of the tests show that the aggregate saving rate is positively affected by the moving average of the growth rate of income and the variance of the income growth. The positive effect of the income growth differs from the negative effect found household survey data were used. Adebiyi (2005) employed quarterly data spanning between 1970 and 1998 to examine savings and growth relationships in Nigeria using Granger causality tests and impulse response analysis and concluded that growth, using per capital income, is sensitive to, and has an inverse effect on savings. Mohan (2008) believes that household savings in India has contributed significantly to its economic growth which recorded a steady rise over the last decades. Mohan found some empirical relations whereby in the argument that high levels of debt-GDP lead to high interest payments relative to GDP, which crowd out government capital expenditure and reduce the overall saving rate, two relationships are of critical importance: the responsiveness of changes in the saving ratio with respect to changes in the fiscal deficit levels; and the responsiveness of government capital expenditure to changes in the level of interest payments. Mohan (2006) experienced the path of causality between economic growth and savings in different economic income classes. The ADF test indicates that both log GDP and log GDS have unit roots in the level data. In the presence of unit roots, the variables need to be differenced in order for the series to be stationary. Without differencing the data, a causality tes t would lead to misspecification. To examine the direction of causality between saving and economic growth in Nigeria during the time frame 1970-2007, Oladipo ( 2009) used the Toda and Yamamoto (1995) and Dolado and Lutkepohl (1996) TYDL methodology. The variables of interest for savings and economic growth are positively co-integrated indicating that there exists a steady long run equilibrium relationship. Furthermore, the findings also revealed a unidirectional causality between savings and economic growth and thus the corresponding role of FDI in growth. In order to establish the link between economic growth and saving in Nigeria during the time frame of 1970-2007, Abu (2010) used the Granger-causality and co-integration techniques. There exists co-integration and long-run equilibrium between the variables savings and economic growth according to the Johansen co-integration test. There is also the causality runs from economic growth to saving, implying that growth triggers and Granger produces saving. Hence, the Solows hypothesis that saving leads to economic growth, and recognize the Keynesian theory that it is economic growth that leads to higher saving, is discarded. CHAPTER 3-DATA ANALYSIS 3.1 Sources of data The economic growth rate, household debt and household saving rate, price level are available on the Global Finance website. The interest on savings, consumption and investment are available on the Nationsmasters website, the World Bank website and the Penn World Table website. 3.2 The Econometric Model In this section, a model is developed to measure the impact of household debt and household saving among other factors, on economic growth. The model for growth for country i in time t is as follows: EGit= ÃŽÂ ± +ÃŽÂ ²1 HDit + ÃŽÂ ²2 HSit + ÃŽÂ ²3 Rit + ÃŽÂ ²4 Pit + ÃŽÂ ²5 Cit+ ÃŽÂ ²6 Iit + Uit Where EGit= Growth Rate of Real GDP per capita at constant prices HDit = Household Debt as a % of Gross Domestic Product (GDP) HSit= Household Savings as a % of Disposable Income Rit = Interest on Savings Pit= Price Level of Gross Domestic Product (GDP) Cit= Consumption Share of CGPD (GDP PER CAPITA) Iit= Investment Share of CGDP (GDP PER CAPITA) Uit = the disturbance term 3.3 Economic Growth When per capita GDP or any other means of calculating total income rises, economic growth arises and this is usually registered as the yearly rate of change in GDP. Economic growth results from advances in productivity in terms of more production of goods and services with the same factors of production. The dependent variable economic growth is measured by real GDP per capita. At times, total GDP figures are not reflective of the actual performance in the economy. Hence, GDP per capita is a better measure as it is liable to fewer errors and some errors tend to affect population estimates and thus they have offsetting impacts. Furthermore, the natural log of real GDP will be taken into account to avoid any large outliers. Screen-shot-2009-09-01-at-14 3.4 Household Saving Household saving can be defined as a percentage of household disposable income which is not consumed and household savings rate can be calculated on gross or net basis. Depreciation is considered in the net savings rate which is more commonly used compared to the gross savings rate. Comparisons of savings rate among countries become hard by these two different measures of gross and net savings rate due to distinct social security and pension programmes, variable tax schemes which have an impact on disposable income. The household savings rate of a country can be affected by age of the economys population, the accessibility of credit, general wealth issues, cultural and social factors. Nevertheless, household savings rates are still a good a measure of an economys income in relation to consumption over time. A country can finance its debt domestically if it has a relatively high level of household savings. High debts levels funded mostly by foreign creditors are less persistent than high debts levels financed by internal savings. Consumption allows GDP to grow and this is a significant factor in economic expansion. With the existence of financial crisis, the whole economy could be dampened with lower consumption due to higher debt and lower savings level. A larger portion of GDP growth should then come from FDI, exports and government expenditure. Household saving is the most essential domestic source of funds to back capital outlay and this is a substantial boost for economic growth on the long term basis. Household savings rate vary greatly among countries as shown in the chart. This is partially due to the level pensions schemes are financed by government rather through personal saving and also to the extent governments offer insurance against sickness and unemployment. savings01 Considering the time dimension in the table above, the savings rate were relatively steady or somehow rising mildly in France, Austria, Italy, Norway and Portugal but have been decreasing in United States, Canada, Japan and Australia. If the social security and insurance payments of USA are considered, its savings rate would be striking. 3.5 Household Debt When a country has a substantial degree of household debt, it increases its inclination to financial crisis and this acts as a hindrance for economic growth. There have been forecasts about house bubbles which were caused and thus creating the countries to be overheated. A large portion of the economic growth was centred on household consumption which was backed by loans from banks. When banks noticed the lack of credit worthiness from consumers who even lost their confidence in the financial system, there had been strict controls over the lending conditions for loans. As a result, the ongoing vicious circle preceded a major decline in economic growth following the fall in consumption and repayments of debts. Analysing the graph results with the conclusion that USA is not the only main country having experienced the worst GDP slowdown but many other countries like Iceland and Portugal are following suit with the level of household debt actually rising substantially. It would not be logical for a country burdened by a large level of household debt to expect its economic performance to flourish in the coming years. HouseholdDebtSelectedCountries household-debt-vs-savings Source:   Lew Rockwell 3.6 Rates of interest The rate of interest has a great influence on the given level of aggregate disposable income which is divided between consumption and saving. However, it cannot be predicted with conviction that a lower interest rate would imply more disposable income will be dedicated to consumption and less to saving or vice versa. As a matter of fact, there can be a rise or fall in the total amount saved following a change in interest rate and this depends on the income and substitution effects and their strengths of their net effects. A higher level of future consumption arises at the detriment of present consumption with substitution effects due to higher interest rates and thus resulting in more savings in the present period. On the other hand, a consumers future income compared to his present income can be increased following higher interest rate and this leads to higher consumption by borrowing from future income and hence, less is saved. However, this may not be necessarily the case for lower income earners who would save only a small part of their incomes even when interest rates are high. The substitution effect will then outweigh the income effect and there will be a direct link between income and rate of interest. For some people who prefer to save a greater portion of their incomes, the income effect may offset the substitution effect and thus higher interest rates would result in lower present savings level real-interest-rates 3.7 Price level/Inflation One of the theoretical concepts of economics says that when there is a change in the price level, this may affect consumption and savings positively or negatively. It is usually believed that households confidence in money erodes when there is inflation and hence, they have the tendency to save more since inflation actually raises the variance of expected real income. The fact that consumers have greater preference for unplanned increases in savings compared to withdrawals, it usually incites consumers to save more when inflation is high. There is also an indirect effect of inflation whereby the real value of nominal asset is diminished and thus the real value of liquid assets decreases the net household wealth. Real consumption is often reduced and savings rate increases. 080625_global_inflation (1) 3.8 Consumption The total value of goods and services purchased by people aggregated over time is called consumption and it is usually the greatest GDP component. A countrys economic performance is often assessed on its consumption levels. Different income earners would be consuming differently depending on their standard of living and purchasing power. Consumption is usually determined by current income, accumulated savings and expectations on future income. Consumption and consumer debt trends 3.9 Investment When an owner usually acquired property for the purpose of generating income like plants and equipments, this is called investment as it is spending on income-generating assets. If a country wants to achieve long term sustainable economic growth, it should be able to the rates of accumulation of capital be it human or physical so that it can result in more efficient assets and so that the whole population can have access to those assets. With the help of financial instruments, markets, and institutions, the extent to which information, enforcement and transactions costs can have their impact on savings rates, investment decisions, technological innovations and steady-state growth rates can be improved. Average annual investment growth in the first six quarters of recovery Source: National Bureau of Economic Research; National Inco

The Watergate Scandal Essay -- Papers History USA Government Corrupt E

The Watergate Scandal The mistrust most Americans feel toward the government officials and political parities of today can be traced back to the Watergate scandal of 1972, which led to the resignation of an American president. The crimes of the Watergate scandal included political burglary, bribery, extortion, wiretapping (phone tapping), conspiracy, obstruction of justice, destruction of evidence, tax fraud, illegal use of the Central Intelligence Agency (CIA) and the Federal Bureau of Investigations (FBI), illegal campaign contributions, and use of taxpayers' money for private purposes. On June 17, 1972, five men were arrested at 2:30 a.m. They were caught trying to "bug" the offices of the Democratic National Committee at the Watergate hotel and office complex in Washington D.C. When the police caught the men, they were in the office of Larry O'Brien. He was chairman of the Democratic National Committee, whose job was to aid political candidates in the Democratic party get elected. In 1972, O'Brien's main priority was to help the Democratic candidate for president, Senator George McGovern. The five men, who were arrested, were identified the next morning by two lawyers as, James W. McCord, Jr., Bernard L. Barker, Frank A. Sturgis, Virgilro R. Gonzalez, and Eugenio R. Martinez. Reporters and politicians were interested in this case because they found out that McCord was a former member of the CIA. Its agents are not permitted to spy on Americans. Not only was he a former member of the CIA, but now he worked for the Committee for the Re-election of the presi dent, or CRP. This Republican group was formed to help President Richard M. Nixon win a second term in office. Referring to G. Gordon Liddy, John M... ...at: "I shall resign presidency effective at noon tomorrow." (What Was Watergate? by: Pamela Kilian ) Gerald Ford was sworn in as president of the United States the next day. Watergate was not just a "third-rate burglary," as Nixon called it. It was much more. It led to many heinous crimes. It contributed many words and phrases to our present-day vocabulary. Because of this scandal, the suffix "-gate" will now be acquainted with every Washington mishap. Because of this scandal people look at government officials differently today than they did before 1970. Bibliography: What Was Watergate by: Pamela Kilian Internet: http://www.chron.com/content/interactive/special/watergate/chronology.html http://www.chron,com/cgi-bin/auth/story/c...t/chronicle/editorial/97/06/20/edit2.html http://www.netspace.net.au/~malcolm/wgate/intro.htm

The Death of an Idol Essay -- Personal Narrative

When I was young, my mom took me along everywhere. At least once a month, we would travel to Oregon to visit my Aunt Kathy. I would go to the dark and creepy basement to play with my cousins, Carly and Marni. Together, we usually played with little Carebear figurines. I started to grow close to my cousins, especially Carly, even though she was seven years older than me. Her kindness made me feel warm and welcome. Though she got older, it seemed that I never grew. I always looked up to her and her dedication to everything. My mom used to take me to all of Carly's sporting events in high school. I just loved cheering her on. Whenever she was on the basketball court, she always found time to wink at me in the crowd. I even made big posters to take with me when she made it all the way to state for the three-point contest. After high school, Carly decided that she didn't want to stay around anymore. She wanted to go to college away from home. Since she was such a great student, she figured she'd be fine. Carly decided to attend Hofstra University in New York. We promised to be pen pals. Well, that lasted about a year. I was finally growing up, getting busy, and we were losing touch. When we did write, all that I heard of were the boys she dated, and that her A's were dropping to C's. Every once in a while, I would ask my aunt how Carly was doing. The only answer I ever got was "She's fine." A couple of years later, we ... ...at was the day a letter came in the mail for Carly. She had passed her CPA exam. My Uncle Don was the fire chief of the town, so the funeral was full of firemen and police officers. The procession was even led by a fire truck. I look back now and wish that I could have spent more time with Carly. What exactly was so important that the two of us didn't have time for each other? Even though we had some bad times, I'll always remember the good. I think that we all live a life that is already planned. She skipped her time to go, and got another chance. I'm grateful that in that period I got to reunite with her. I hope that I can live her dreams through my life. After all, she is my idol.

I’m Not an Imitation of Someone Else, I’m Latina :: Personal Narrative Writing

I’m Not an Imitation of Someone Else, I’m Latina As I sat at the kitchen table on those chilly winter evenings in Kenner, Louisiana, I could feel my mother staring at me from where she was. I was busy doing my homework, and she was preparing that night's supper. She would always start off by asking me what I was doing and the only thing I would ever answer was, "Oh, nothing. Just homework." Then I would turn away and sort of look in the other direction as if to tell her to leave me alone, because I had a lot to do. At the time I was only eight years old, in my second complete year of schooling in the United States. I had already fully grasped the English language, and it had been a year and a half since I had been removed from the bilingual program. In actuality, I had become Americanized quiet easily. Although this was a process that involvedgive and take, because although I did adapt to my new environment very well, I never let go of what I had already learned in my previous environment. I can recall that at the same time that I was learning to read and write in English, I was also learning to do so in my native tongue, Spanish. In school, as I sat in the small wooden house, which was the bilingual classroom, I could clearly remember wondering why it was that "Spot" was so important. For more than a month we had been learning about this brown dog and about seeing him run. This experience was very strange for me, not only because it was in a totally new language but because I never did really see spot run. I only saw him painted on an oversized illustrated notebook. After a long and confusing day at school, I would come home to do my assignments; alone. It wasn't that my mother did not want to help me, but she couldn't. She knew little about the assignment , and knew even less about the language. At first I didn't mind. The assignments were easy for me to figure out, and if it was really hard I would just tell the teacher the next day that I couldn't figure it out. Sh e would ask me why I didn't ask my mother for help, and I would have to respond to her, "because she didn't know either.

Proctor and Gamble – Strategic Management Case Study

EXECUTIVE SUMMARY Proctor and Gamble (P&G) over its journey of about 175 years has become one of the world’s largest consumer goods Company with sales of nearly $80 billion and a net profit of about $10 billion. P&G has a presence in more than 180 countries with brands that accumulate to in excess of $25 billion. The company has achieved success by creating high quality brand recognized products that are sold on multinational level.It enjoys one of the largest brand names in household products like Pampers, Gillette, Tide, Ariel, Downy, Pantene, Head  &  Shoulders, Olay, Oral-B, Crest, Dawn, Fairy and Always and segments like household care, beauty, grooming, and personal health care. Although, P&G has world renowned brands, P&G needs to adopt strategies that enable it to maintain its competitive advantage over its rival. Consumer Goods industry where P&G operates has matured reaching the consolidation stage and competition amongst rivals is intense.P&G has many strategic options create competitive advantage over its rivals such as further market penetrations by rebranding its current line of products and selling them at a lower price. Another option for P&G is to expand in the emerging markets by collaboration or alliances with local businesses in various geographical regions. Lastly, P&G can specialize in skin care/beauty segment of consumer industry. P&G can provide consumers with products that are made with natural ingredients as trend in health and wellness is growing along with providing specialized products for men.INTRODUCTION P&G is a part of a competitive industry, and as such faces very stiff and fierce competition from its rivals. The competition faced by the company is virtually on every front like, market share, product line up, innovation of new products, R&D for new and existing products. It has witnessed a drop in market share and revenue from the developed market and but sustained appreciable performance in the developing markets.Th is report provides a thorough internal as well as external analysis of P&G, identifies its mandate, along with certain strategies that would help it increase its profitability, profit growth and sustain its competitive advantage in both developed and developing markets. The limitations of this report are due to the fact that it primarily relies on the information and facts as presented in Case 27, Proctor & Gamble: The Beauty/Feminine Care Segment of the Consumer Goods Industry.External references were also used and information was sought from the Proctor & Gamble Company 2012 Annual Report and the Proctor & Gamble website. COMPANY OVERVIEW Procter & Gamble was founded in 1837, by William Procter and James Gamble, who laid the foundation of P&G by initially making and selling soap and candles. By 1879, founders of P&G developed Ivory soap and established their own laboratory, and by 1935 the company established another factory in the Philippines after its acquisition of the British soap manufacturer, Thomas Hedley & Sons.In January 2005, P&G announced an acquisition of Gillette, forming the largest consumer goods company and placing Unilever into second place. At present, Procter & Gamble sells more than 300 leading brands, such as Pampers, Tide, Pringles, Ariel, Downy, Pantene, Head  &  Shoulders, Olay, Cover Girl, Pantene, Crest, Duracell, Secret, Folgers, Hugo Boss, Mr. Clean, Oral-B, Old Spice, Clairol and Zest. The company markets its products through mass merchandisers, grocery stores, membership club stores, drug stores, high-frequency stores, department stores, perfumeries, pharmacies, salons, and e-commerce.It markets its products to over 160 countries, and operates a total of 115 plants in more than 80 countries all over the world. Procter & Gamble’s headquarters are located in Cincinnati, Ohio and it employs more than 98,000 employees worldwide. Off late, the company’s performance has dwindled as the company has been shuffling its strategy and has not been able to keep competitors at bay (Chung, 2012). Recently the company’s Board has unanimously accepted CEO McDonald, who had joined in July 2009, as the one who would plan and head the company’s turnaround of performance (Chung, Jul 2012).As such the company has adopted a multi-fold strategy to cut costs by a big chunk and bring up new and innovative products to shore up sales and profits. Example being the fact that â€Å"the company will launch at least nine new products in the next four months, many of them priced at a premium to generate higher profit margins† (Monk, 2012). MANDATE The mission of the company is to â€Å"provide branded products and services of superior quality and value that improve the lives of the world’s consumers, now and for generations to come†.And this would automatically generate value for all its stakeholders in form of higher sales and returns. The vision of the company is to be recognized as à ¢â‚¬Å"the best consumer products and services company in the world†. P&G has kept is vision powerful and yet pretty clear. This vision of the company is simple enough be easily comprehended by all its stakeholders. The core values of the company rotate around the consumers, its brands and its employees. These values are leadership, ownership, integrity, passion for winning and trust.The company, through all its core values, has tried to address the fact that they seek to work and deliver a trust to their consumers with the help of their employees, who are expected to work with leadership and ownership and must have a passion for winning so that they can together work to strive to achieve the vision of the company. Just like the vision of the company, the core values also are very clear and straight forward that define the reason for the existence of the company. P&G’s stakeholders are its customers, shareholders, employees, uppliers and communities in which it operates. P&G’s customers are the ones who ultimately use the products and given the fact that the industry is highly customer oriented and demand driven. The shareholders invest in P&G’s shares providing the company with capital and the company rewards them by consistently creating and increasing the shareholder value. Proctor and gamble employees worldwide are considered its most important asset who are the back bone of this giant corporation, they expect ethical treatment along with fair wages and good working conditions.Another important stakeholder of P&G is its suppliers whose organizations heavily rely on the business agreements with P&G, and the businesses who sell and distribute P&G products. Also, different communities all over the world from Cincinnati, Ohio to the many communities around the world who are provided with jobs, employee education, stability and who pay taxes because of Procter & Gamble. EXTERNAL ANALYSIS 1. Competitive Rivalry: The industry that P&G op erates in is highly competitive and it has emerged as one of the leaders in the industry.This industry has five major competitors and has reached the stage of consolidation. Due to industry consolidation, changes made by one company forces other competitors to react and follow suit. This increases rivalry and might lead to price wars. The demand for beauty and personal hygiene products is on the rise due to many factors such as; the growth in the economies of developing world has improved the standard of living of people in those regions; men are becoming more interested in beauty and skin care; and also due to the growing demand for products made with natural ingredients and raw materials.This increase in demand and potential for growth has provided stability in the industry. 2. Threat of New Entrants: Five major competitors in this industry have captured most of the market share through economies of scale and brand loyalty. The wide range of products in major competitor’s p ortfolio makes it extremely difficult for the new entrants to compete and gain any significant market share. Potential entrant would require an enormous amount of capital for manufacturing alongside a huge budget for marketing activities, R&D, supply/sales channel in order to compete at the same level as major competitors.This creates a very high barrier to entry in the industry that makes the threat of new entrants, very low for the industry. The patents held by the company on various products also act as barriers to entry. 3. Bargaining Power of the Buyers: Businesses in this industry rely heavily on its buyers to generate a considerable portion of revenue. Buyers of this industry are mainly distributors like Walmart, Macy’s, Target etc. These distributors buy in large quantities which increases their buying power allowing them to bargain lower prices.As a result, over exposure of sales to any single buyer could pose a serious threat to this industry if competitors do not h ave their own customized distribution network. 4. Bargaining Power of Suppliers: There are almost no substitutes for raw materials being used in products manufactured by this industry which is a cause of concern. Suppliers seem to enjoy high bargaining power but the sheer size and quantities purchased by major competitors in this industry tends to scale back the supplier power as competitors can move towards vertical integration.Hence, the buying power of suppliers is medium. 5. Threat of Substitutes: There are no known substitutes for this industry which places the threat of substitutes at a very low level. Macro Environment The raw materials used to manufacture products in various segments of Fast Moving Consumer Goods (FMCG) industry are regulated by governments in many countries. There is a risk that currently used raw materials may be considered potentially dangerous and therefore restricted in their use due to the increase in health consciousness especially in western markets. Product testing can take months even years before getting an approval for consumption and during this time regulations can change preventing a product from ever being introduced to the market resulting in large R&D expenses which may never be recovered. Social forces can have an effect on this industry such as the desire for organic products as consumers become concerned that chemicals currently being used can cause long-term health ailments like cancer and skin diseases.Men are also fast becoming more interested in beauty and hygiene products and populations in developing countries are also turning towards beauty and personal hygiene products as their living standards improve. The future for this industry is bright with potential for growth but for some companies this can be a threat if they fail at product innovation and strategizing their business as per the changing trends. Technological changes such as exponential growth in internet and ecommerce provides a great platform to th is industry to market its products directly to target demographics and also to raise awareness of personal hygiene.On the internet, there is a massive potential to target consumers based on their web searches, previous online purchases, etc. Advancement in technology can also help this industry’s distribution systems such as emergence of real-time inventory systems allows inventory levels to be replenished on time and prevent excessive inventory on-hand in factories or warehouses. The reduced barriers to international trade give companies in the industry the opportunity to expand into various regions of the world. Many regions like China, India, and South America are opening up to the world providing an excellent opportunity for expansion.However, the reduced barriers to international trade can also be considered a threat if international companies expand into home bases such as Europe and North America which will in turn give rise to the local competition. INTERNAL ANALYSIS P&G is the industry leader because of its ability to maintain a competitive advantage over its rivals resulting in higher than average profitability. P&G has many resources that contribute towards gaining and maintaining competitive advantage over the rival. One ofP&G’s main strength is its strong financial position which allows it to acquire other companies. P&G has acquired Gillette boosting its competitive advantage over its rivals as Gillette mainly caters to Men which is growing market. Strong financial position also allows P&G to incur high R&D costs i. e. in excess of 2. 2 billion dollars. P&G is constantly investing in product innovation and improving its current line of products. The company over the past many years has successfully launched and managed new products.As such, P&G has the ability to push for innovation and ensure faster commercialization than any of its competitor in the industry. This investment in improving brands and innovation also promotes brand l oyalty. P&G operates in various segments of FMCG industry such as Personal hygiene, Household care, and Beauty. This variety of products offerings from P&G caters to almost all demographics; throughout different ages, genders, countries and cultures. P&G operates in various regions across the globe and has successfully managed to establish itself as a leader in these markets across many segments.This diverse range of product offerings along with its operation in various geographic regions allows P&G to reel through the recessions in the economy and maintain its profitability. Any slowdown in the economy of anyone region or segment is countered by growing economy and segments in other regions. Also, type of products offered by P&G are considered to be recession proof as they considered to necessity such as soaps, shampoos, personal health products etc. P&G derives its strengths from its various capabilities. First of all is that P&G has the marketing of its products in the industry.T his enables P&G to convince its consumers to buy products and also keeps them up to date with new products as well as about any improvements in the current line of products. P&G also has an efficient distribution system which allows it to distribute its products in various region of the globe at a lower cost than its competitors. P&G also collaborates with distributors like Wal-Mart, Target etc. to keep supply chain functioning efficiently. This allows restocking of shelves at distributors much easier as it provides real time data to P&G as stock levels deplete.This allows P&G to save costs associated with huge inventories and warehouses. Also, P&G owns and operates almost 115 manufacturing facilities across 80 countries around the globe. This is a great asset of the company which provides it with the capability of saving on cost of shipping products from one region to another. All these sets of co-related resources and capabilities allow P&G to save on costs and provide high qualit y products at a reasonable people which in turn has generated above average profits in the industry making P&G the industry leader.Along with strengths, P&G also has certain weaknesses and threats that can offset its competitive advantage and affect its profitability. In the current global down turn commodity prices across the globe are increasing due to transportation costs associated with higher oil prices. This will force P&G to raise prices on many of their products which might affect market share because some consumers may switch to cheaper low quality products. This is further exacerbated by the fact that switching costs for consumer are quite low between the competitors in many segments of this industry.While P&G has great collaboration with Wal-Mart, which allows it to maintain an efficient supply chain management but this is also one of the weaknesses of P&G as Wal-Mart is its number one buyer as considerable amount of P&G sales are accounted to Wal-Mart and followed by oth er major retailers like Target, Zellers, etc. This provides buyers with immense buying power and any decrease of sales at any of the top customers can affect P&G effecting its revenues and subsequent profitability.P&G is also exposed heavily towards the matured markets of Europe and North America. STRATEGIC OPTIONS Further Market Penetration – In this strategy, P&G should increase market penetration its current skin care and personal hygiene segments. P&G should look towards in its customer base and specifically targeting low income consumers in mature markets. P&G can achieve economies of scale in its current product mix by rebranding such as packaging or size/volume of the product. This way P&G will be altering its existing products at a low fixed cost.By harbouring this strategy, P&G will be able sell its products at a cheaper price and increase its revenue and subsequent profits. This is low risk strategy because P&G has managed to achieve strong brand recognition and cus tomer loyalty so P&G does not have to incur huge marketing costs in order to introduce its products to the market. P&G already and effective supply chain management and it has good relationship with mega distributors like Wal-Mart, Target etc. so it will be much easier for P&G to introduce these rebranded products to consumers.Furthermore, P&G has a strong financial position which is essential in case the strategy fails to garner expected results. Further Market Penetration| Arena| All markets where P&G currently has a presence| Differentiator| Price, Quality| Vehicles| Rebranding, marketing| Staging| Rebrand products in different packaging with less volume quantities| Economic Model| Sell rebranded products at lower price to the low income consumers| Pros| Enhances existing capabilities and resources Low Risk| Cons| Short to medium term solutionBrand loyalty is scarce in consumers looking for lower priced products| Table 1There are some drawbacks in this strategy which must be cons idered such as the lack brand loyalty in low income consumers. Low income consumers tend to prefer products that are competitively priced so if another competitor implements the same strategy they can take away P&G’s market share. Hence, this strategy is only viable from short to medium term. Global Expansion in Emerging Markets – P&G derive most of its revenues from matured market of North America and Europe where market has reached the saturation point and revenue growth is stagnant.Unlike the mature markets, emerging or growth markets have a lot of potential for growth and there is a lot of market share up for grabs. As P&G looks to gain greater share in the developing countries, it needs to adjust its planning according to the demographics of such country i. e. ethnic groups with different skins, hair types etc. As P&G already has a strong set of products, it must be relatively easier for P&G to penetrate into emerging markets especially in terms of brand recogniti on, mass market presence, and brand loyalty.P&G can avail this opportunity by introducing quality products based on the specific needs of the local population or by acquisition of businesses who produce such products. This strategy would help P&G in the long run as it would allow P&G in keep its revenues up during the economic downturns in mature markets as sales in emerging markets will offset the recessions in the mature markets. Rules and regulations vary country to country so some countries can have stringent rules for Multi-national Corporation to protect its local businesses.Global Strategic Alliance or collaborations with local businesses will enable P&G to expand in to the local market in areas such as China, India or South America. The extensive knowledge of consumers, market trends, laws and regulations that Partner Company brings to the table can be considered an excellent distinctive competency. Global Expansion in to emerging Markets| Arena| Emerging Markets| Differenti ator| Price, Quality| Vehicles| Collaborations (Global strategic alliances), Acquisitions,| Staging| Collaboration with local businesses and then move towards acquisition of the same. Economic Model| Provide quality product at reasonable price to consumers in the emerging markets| Pros| Great long term potentialDiversification through operations in various regions which provides an opportunity to keep revenues up during recession in one region| Cons| High risk involved in collaboration/acquisitions along with the instability of economic growth in emerging marketsCompany can lag behind in innovation| Table 2 P&G should select it partner carefully in emerging markets keeping in mind the risks associated such as rules, regulations etc.P&G must form a structure where the share, responsibilities of each party is clearly defined along with contingency plans to mitigate various risks involved. P&G should protect its trade secrets and product formulas so manufacturing facilities must have s eparate units, and PG should also get all its patents recognized in the region where it will operate. Some of the cons of this strategy are embedded with the collaborations with local businesses and the instability in the emerging markets.Also, P&G will essentially be rebranding most of the products it sells in mature markets along with selling some products of its partners which means there will be less spending on R&D and company might lag behind in innovation of new revolutionary products. Differentiation in Beauty/Skin Care Segment – In this strategy, P&G will offer unique and innovative products that address special needs of various market segments and demographics such as products with natural/organic ingredients, products for certain demographics such as men, ethnic groups etc.Beauty/skin care segment of consumer goods industry is growing as consumers are more interested in grooming themselves with better products and growing trends in health/wellness. P&G can create a competetive advantage by specializing in products made for men and products made with natural/organic ingredients. This strategy will require acquisition of products or spending in R&D to innovate such products in house. This will also require aggressive marketing and branding of such products to introduce them to the consumer.These products must be priced at a premium price based on the advertising costs, acquisitions and R&D spending. Many features of the products along with quality will offset and justify the higher price for such products. With continuous R&D spending over time, advancement in technologies and increasing competition, prices will eventually reduce. If P&G is able to acquire or create new line of specialized products which caters to certain market segments or demographics, it will be a competitive advantage for P&G over its rivals.Differentiation in Beauty/Skin Care Segment| Arena| Mature Markets first and move into growth/emerging markets| Differentiator| Select ion, Quality| Vehicles| Acquisitions, Signalling| Staging| Acquisitions of major business involved in organic and men beauty/personal hygiene segments| Economic Model| Sell specialized products targeting certain customers with premium prices i. e. organic products| Pros| Leverages existing resources and capabilitiesLong Term potential| Cons| High Risk with acquisitionsHigh costs associated with R&D spending| Table 3This strategy has some disadvantages as well such as it requires a lot of capital investment either for acquisition or R&D to create new products. REFERENCES Mockler, R. J. (2007). â€Å"Procter & Gamble: The Beauty/Feminine Care Segment of the Consumer Goods Industry† In C. W. L. Hill & G. R. Jones, Strategic Management: An Integrated Approach, 6th Edition. Boston: Houghton Mifflin Chung, J. (2012). â€Å"P&G's Board ‘Unanimously Supports' CEO McDonald† Retrieved from http://online. wsj. com/article/SB10000872396390444464304577534930564069566. tm l Mo nk, D. ( 2012) â€Å"Procter ; Gamble planning nine new product launches† Retrieved from http://www. bizjournals. com/cincinnati/blog/2012/09/procter-gamble-planning-nine-new. html Annual Report (2012) Retrieved from http://annualreport. pg. com/annualreport2012/files/PG_2012_AnnualReport. pdf P;G History (2012) Retrieved from http://www. pg. com/translations/history_pdf/english_history. pdf P;G Purpose, Vision and Principles. (2012) Retrieved from http://www. pg. com/translations/pvp_pdf/english_PVP. pdf