Managerial Economics Essay Example | Topics and Well Written Essays - 1000 words

Managerial Economics - Essay Example The trade agreements have reduced prices of goods and services of America in foreign markets and also in the home country; tariffs and taxes on these products have been eliminated to a considerable extent. Overall benefits because of globalization are numerous but the major one is surging demand of products and services along with reduction in their prices. As a result of globalization and trade agreements, foreign goods are available at cheaper prices and more American workers are losing their job as labor cost is rising at an accelerating pace. Globalization Globalization has helped in easing up trade between countries as it allows exchange of information, products, resources, services and markets at international level and gives organizations the opportunity of interacting with markets present in different countries. According to globalization theory, cited by Rogers and Hyatt (2012), there are about six processes of globalization that are dynamic and interdependent such as: 1. In crease in economic dependence across the world 2. Dramatic rise in exchange among countries on cultural, economical and resources level. 3. Breakthrough innovations in technological field allow quick access to important and new ideas and information. 4. Space and time has been compressed. 5. Institutions and events have been disembodied that allow restructuring and realignment of interaction on social level across time and space. 6. Reflexive processes have increased global consciousness. Hence, government policy makers have to take into account the factors that are impacting globalization as it has become an important part of every economy. In addition, many governments have changed their policies to support Foreign Direct Investments within their countries so that economy gets boosted (Castle, 2012). Trade Agreements – Protectionism or Deregulation Trade Agreements are being done on an increasing rate among countries to cope up with the recession that has significantly impa cted their economies. According to some researchers, Trade Agreements have helped in taking advantages of benefits being offered to each party; on the other hand, some critiques have argued that it poses threat to local manufactures and service providers (Shah, 2010). In economic policy, protectionism is used to create some restrain in trade through various measures like regulations, quotas and tariffs; it is used in discouraging certain goods imports and give protection to domestic markets as well. On the other hand, deregulation is done to have free economic activity that is free from binding rules of the state; the main idea of this attempt is to boost competition in the country (Labonte, 2010). Some critics have referred to protectionism as a barrier to free trade as it makes certain industries eligible for subsidization that means competition reduces to a greater extent as everyone is treated on an equal basis. However, deregulation allows easy trading amongst countries and mot ivates domestic producers to contribute more in its respective economy. Inflation Inflation is described as increase in price of goods and services (Amadeo, 2012). When inflation is increased, individual’s standard of living falls considerably; each dollar spent for purchasing will buy less amount of thing being bought and more money will be required to get hold of same goods and services. When the inflation is mild, it can significantly impact the economic growth of a country. Healthy economy is one in which prices rise slowly and gradually so that future increase in prices can be avoided. All government policies have to ensure that inflation is controlled so that prices of goods and serv

Outsourcing and how it has effected communication between customers Essay

Outsourcing and how it has effected communication between customers and companies that outsource - Essay Example The result today is a capitalist international economy which has made inroads into the formerly socialist states of eastern and central Europe. Global interdependence is now a feature of the world system and whether one thinks that globalization is a good or bad thing it remains here to stay. Outsourcing, meaning the subcontracting of employment to other countries, is an increasingly common phenomenon with global ramifications (the terms â€Å"offshoring† and â€Å"outsourcing† will be used interdependently here). As the jobs of the first world make their way to the developing countries of the third world, the forces of globalization have had many unintended consequences. The loss of manufacturing jobs in the countries of the Western world and their movement to lower paying countries of the developing â€Å"third world† has restructured the global economy. While outsourcing has had variety of consequences, both positive and negative, this research paper aims to p rovide a holistic analysis of the outsourcing phenomenon in the twenty-first century. What have been the effects on customer satisfaction of outsourcing between customers and companies that outsource? The following will now explore this important question in light of the offshoring phenomenon. Seeking to understand the correlations between customer satisfaction and the offshoring of tasks, duties and responsibilities in the twenty-first century, a recent article in the Wall Street Journal highlighted the important concerns raised by customers when customer service is offshored. Have you ever called a company with a question or complaint and been redirected to Bangladesh, India or the Philippines? Arguing that this is an increasingly common phenomenon in our era of globalized trade and that outsourcing primary customer service functions have a wide variety of