Advantages and Disadvantages of Globalization

Advantages and Disadvantages of Globalization The term globalisation has many understanding from different people. Hill, (2005) as cited in Stuart, et al (2010), mentioned it refers most countries would shift toward a more integrated and interdependent world economy by the merging of historically and separated national markets into one huge global market place. Gavin C(2009)stated that it had replace those economic expressions such asinternationalization and transnationalism. Sadegh B.,et al,(2006) citied as Cheng (2000), mentioned that nowadays of people have great opportunity to learn from other countries. The globalisation could be superior grow that main driver key is there exiting many of preferences and the need of consumers from the worldwide (Pierre,D., 2006).Catherine ,D(2005) agreed that it could be reach an unexpected phenomena with high technology , advance communication and free trade market. 124 The impact of globalization has bring success of business to new level, where many countries have been go through it(EconomyWatch.,nd). In research based on Economy Watch team that found the globalization has bring forward on each industry and meanwhile it has destroy some of industry where its cannot survival though the impact of globalization. Their research have shown the financial industry could gain more benefit after the emergence of financial markets on global rather than local market, and be more efficient entrance the finance facility at other countries. With the free trade principle exercises on worldwide, it has result in boost up the finance flow. Economy of country will also increase whereas gain more business trade and investment from foreign investments, which has mentioned by Adam Smith, as cited in Ferraro (1998). 132 What are advantage and disadvantage of globalization? In generally , globalization has give advantage to company such as opportunity of develop new market for consumers have more variance choose the best quality product. It also provides educated understanding between different nationalities(bangkoklogistics,n.d.). Besides, companies can outsourcing their part of project that reduce time, uncertain factors and fail product. They can find more profit base on manufacturing rather than charge high price on consumer. Thus, they offer reasonably price for attach different type of consumer with good quality. Government has encouraging MNE invest directly on country that reduces unemployment by new investment and industrial ventures.(bangkoklogistics,n.d.) Disadvantage of globalisation Generally, for domestic supplies have to compete with international suppliers that lose the competitive advantage even fight with price. Thus, there would a lot of stress and threat of new type of colonization comes with much power and money from foreign player. Meanwhile, with the outsourcing concept, there would be increase jobless that is working middle class in developed country such as U.S(bangkoklogistics,n.d.). Among many companies have success in financial industrial though globalization, one of company can be more precise explain how reaction on impact of globalization and create new solution at nowadays which is Hong Kong and Shangai Banking Corporate holding plc(HSBC holding plc) The case study Justify why HSBC is MNE before history. Hong Kong and Shangai Bank Cooperate is one of examples success go though globalisations effect in financial industry. Thomas Sutherland was founder the HSBC while he was working in the Peninsular and Oriental Steam Navigation Company[history]. He found that financial service management has huge demand in Hong Kong and China so that he and his group opened bank and established the HSBC in March 1865 at Hong Kong and Shangai. Chuan Li (n.d) stated that the World Bank operates the finance on worldwide but their goods, services were not satisfied, and inefficiency to local market need. Whereas, the World Bank unable afforded heavy debt and lead to a harsh economic imbalances. [111] By this lesson, Thomas had adopted the joint venture concept to operate business at different location(annual report). Thus, HSBC can reduce the uncertain from internal and begin a good relationship at local citizen and government. [35] Management of HSBC HSBC used the ethnocentric approach that easy communication between parent and subsidiary company at early stage. After subsidiary company has stability, then management structured can applied the polycentric method that efficiently and at short term to fit in the cultural and political of that country. With these approaches, HSBC has good start the step in their vision, which is the world local bank. It reminds people who want due to finance related with international and local that HSBC will be their first optional. Besides, HSBC also purchased those companies who specify area on financial field that can reduce costing, and decrease the uncertain risks. Nowadays of HSBC is one of the biggest banking and Service Company in worldwide and headquarter allocated at London. To reflect their vision, it has not ignored power of international network which has 8,000 properties in 88 countries and territories have include Europe; Hong Kong; Rest of Asia-Pacific; the Middle East; North America and Latin America.(annual report 2009)[116] With listings on the London, Hong Kong, New York, Paris and Bermuda stock exchanges, shares in HSBC Holdings plc are held by over 220,000 shareholders in 121 countries and territories. According to annual report 2009, HSBC has good maintained performance and well management convinced to shareholders during downturn periods. Because all shares are trading on the New York Stock Exchange in the form of American Depositary Shares(annual report2009).142 Production To fulfill consumers common need and differential preference, HSBC offer a wide range of production and diverse into four categories such as Personal Financial Services (including consumer finance), Commercial Banking, Global Banking and Markets, and Private Banking. Need shown how effect to world.Categories Personal financial services Commercial banking Global banking and markets Private banking *I will focus these three ,suit title need clear easily gopal. Impact of globalisation to HSBC [summary] Lead Emerging market , HSBC has gain excellent of results through emerging markets on past few years. HSBC has good aim on those potential countries, which would boost up the economic, after change the political and other direct factors. The brand of HSBC was not being easily for entered at foreign market because education of consumers was so weak at early century. HSBC have to send a respective for understanding on real situation and reaction on it. Thus, HSBC provided training at local citizen to build up local teams that enable reduce conflicts and create more jobs which is will accepted by their government. With a good relationship of government, HSBC has confidence gained good result and do further plan in future. Internet age, Arrive on Internet Age, HSBC has adopted IT concept, which applied on their branches. Consumers were not willing accepted the changed at begin period because the network services have not mature yet and unconvinced to consumers. For generation X, they were no confidence with unphysical of documentations and lower of education. However, generation Y has willing be learns new things and can adopt this new phenomenon. HSBC required all stuff be patetion and polite handle this type of consumers. Financial crises, HSBC has well management and be aware of worse on US shares before financial crises. Subsiders of HSBC companies have not totally full influence from financial crises especially Malaysia, and other Asian countries. Top management of HSBC believed that not all eggs should put in one basket. They have enough resource to support those other countries, which has be damaged during downturn. They also willing lend their hand to help on those companies had worst impact with limited resource. Reason why did they success on these issues? Solution those arise from Lead emerging market issues Problems: time scales, burden cost, risk on purchased company, failure response from consumers, will production enable suit to consumer need ,WTO issues, Globalization and market ?the forces of globalization would establish global market for standardised product purchased in huge volumes by consumers worldwide [ot] .while global market do indeed exist for some standardized product but where little product differentiation is feasible or wanted by users, with other product and services varying international tastes and preference mean that product differentiations vital to appeal to local markets. HSBC research team found that success in emerging market has need good timing and more information collection to make precise decision. With new tools of communication, HSBC can easily communicate to other location in efficiency that reduced costing on research, failure response based on customers. To avoid conflicts and risk, they had designed production in wide range that from common characters for general need of consumers until local differential preference. Free trade, less regulation international , Solution those from Internet Age Problem : instability network services, afraid on new technology (ATM), perception of consumer , Globalisation and production ? however it may not only be the cost based advantages of alternative production location which might lead to such outsourcing but possibly less tangible factor , HSBC believed the internet banking will became world trend by following improved the stability network services and evolution of technological. They has outsourcing the machine of auto transfer money where can launch on public in early that it will be competitive advantages. This new pattern of business transaction will increase perception of consumers toward HSBC in developed countries, but it seems need more time for developing countries citizen to adopted the change. Solution those from financial crises: Problem: confidence consumer toward HSBC , dropped expenditure suddenly, cash inefficient, Globalization and the role of the nation state? Loss of competence The impacts of financial crises have serious damaged on economic, government policy taken action for decrease influence on people. Thus, finance industrial suddenly shortage of capital, cash inefficient and withdrawn out huge amount of cash by customers. Fortunately, HSBC has well prepaid enough resource to handle this situation and still borrow out money as usual that it can proofing HSBC has capability go through this recession . There many of factor influence success HSBC on globalistion , it will used PEST analysis for details. Analysis application of theory to evidence Apply part 2 to the company in part 1 Pest analysis : why did hsbc success?[ others factors influence it ] Different used IFRS and GAAP Pest analysis: Political [need more two points] tax policy, Risk of Political Instability, 2010 Country Rating1 Australia 9.24 Singapore 8.78 New Zealand 8.76 Germany 8.49 France 8.46 United States 8.16 Hong Kong SAR 7.49 United Kingdom 7.41 China 7.12 India 7.08 Malaysia 6.90 Taiwan 6.42 Korea 5.72 Japan 5.40 Indonesia 4.94 Philippines 3.50 Thailand 1.75 Footnotes: 1: 0 = very high, 10 = very low Source: The IMD World Competitiveness Yearbook, 2010, Switzerland, www.imd.ch/wcy. According to Business in Sydeny and NSW (2010), third ranked fallen on Australia that shown has a lower risk and uncertain on political. Thus, mostly investors invest on Australia where safe and stable political framework is. United Kingdom: United Kingdom has very little on political risk because of the efficiency on the Westminster system whereby adopted by Australia government (Business in Sydeny and NSW, 2010). During recession, the government of UK has applied some incentive solution even though changed loosening fiscal policy to tightening fiscal policy that grape those attention of public finances (AMB Country Risk Report, 2010c). Malaysia: Malaysia ranked on 13th that has moderate of political risk (Business in Sydeny and NSW, 2010). Malaysia has three major groups of people likes Malay, Chinese and India who are living in peaceful and understanding on each culture(Malaysia truly Asia,2009) .They also working together handle problems that avoid happen serious conflict against on May 1969. The national front consists of UMNO is the Malaysia government which included others races parties as MCA (Malaysian Chinese Association) and MIC (Malaysian Indian Congress) are collaborating for peaceful civilization(Malaysia truly Asia,2009). However, according to AMB research (2010b), found that the government is slowly applying inventiveness which citizen enable accept public contract in more transparency, less subsidies and involvement from government. Besides, government also has encouraging foreign invest in economic sectors (Malaysia truly Asia, 2009). Thus, Malaysian can be achieving the dream of being develop country on 2020. Tax policy : company has paid 28% of tax per yearly Well structure protection employees under Employment Act 1995( stable and good frame structure and can complain labor office http://www.pesaraonline.net/eatutorial.htm) Industrial Relations Act 1967 (major manufacturing law) http://www.pesaraonline.net/ir-guides.htm Trade unions act 1959 (major shareholder and director law) http://www.pesaraonline.net/tua-guide.htm China: China has a high risk of political even ranked after United Kingdom, because it has strongly stability of government and social based on summary A.M.Best Company(2010a).In report mentioned that government look for balance toward communist central with the capitalist- style economic center where can cooperate East industrial. China is a large and huge of population, but considers as developing country with terms of GDP (gross domestic product), infrastructure, and others (A.M.Best Company, 2010a). If advance of industrial keep on expand, it will increase unemployment rate that become useless toward GDP. The government has majority power to control it that avoid happen. Legal : United Kingdom: Malaysia: China: Economics(GDP): GDP, exchange rate , inflation, FDI United Kingdom: Economy 2000 2005 2007 2008 GDP (current US$) (billions) 1,477.58 2,280.11 2,799.04 2,662.65 GDP growth (annual %) 3.9 2.2 2.6 0.5 Inflation, GDP deflator (annual %) 1.2 2.0 2.9 3.0 Agriculture, value added (% of GDP) 1 1 1 1 Industry, value added (% of GDP) 27 23 23 24 Services, etc., value added (% of GDP) 72 76 76 76 Exports of goods and services (% of GDP) 28 26 26 29 Imports of goods and services (% of GDP) 29 30 30 32 Gross capital formation (% of GDP) 18 17 18 17 Revenue, excluding grants (% of GDP) 37.1 36.9 37.4 38.3 Cash surplus/deficit (% of GDP) 1.7 -2.9 -2.6 -4.7 According table 1.a[ GDP, GDP growth, inflation ] the growth of GDP has stable increase because consumer spending more actively on these few years . Then, average of inflation is moderate. The GDP has boost up over than 200 billion which means average of business were doing well. The government has increased inflation rates during high peak of GDP, but it has decrease rate during turn down that increased consumer spending. Industrial sectors, [agriculture, industry, services ] Industrial sector has growth up after but it seems slow down before year 2008.the emerging market has bring benefit to industrial such as lower labour cost ,but them faced many competitors form worldwide. Exprorts and important of good and serives [the exporting percentage has lower than import percentage that business loss some absolute advantages, Gross capital ,revenue , cash surplus or deficit ] the gross capital allocated average 17% and 18%. The revenue percentage of GDP has reach more than 35% Economic Risk: Very Low à ¢Ã¢â€š ¬Ã‚ ¢ The United Kingdom (UK) has the second largest economy in Europe behind Germany. Service industries represent three quarters of economic production, particularly financial services and real estate activities. London is a global financial center and businesses there account for nearly half of the countrys financial services industry. à ¢Ã¢â€š ¬Ã‚ ¢ While positive economic growth has resumed in 2010, the Bank of England is unlikely to raise interest rates until late 2011 at the earliest. United Kingdom has very low in economic risk by report ABM. One of biggest industrial that service can diverse into production, finance services and real se Financial System Risk: Very Low à ¢Ã¢â€š ¬Ã‚ ¢ The Financial Services Authority (FSA) regulates the UK financial services industries, including insurance. à ¢Ã¢â€š ¬Ã‚ ¢ The UK is widely seen as a major center for international insurance and reinsurance and is home to the London Market, a wholesale market that writes risk around the world. Lloyds of London accounts for over half of the business on the London Market. Global links Merchandise trade (% of GDP) 42.9 39.4 37.9 41.0 Net barter terms of trade index (2000 = 100) 100 105 104 105 External debt stocks, total (DOD, current US$) (millions) .. .. .. .. Total debt service (% of exports of goods, services and income) .. .. .. .. Net migration (thousands) 494 948 .. .. Workers remittances and compensation of employees, received (current US$) (millions) 3,614 6,302 7,877 7,861 Foreign direct investment, net inflows (BoP, current US$) (millions) 122,157 177,405 202,071 93,506 Net official development assistance and official aid received (current US$) (millions) .. .. .. .. Malaysia: Economy 2005 2006 2007 2008 GDP (current US$) (billions) 93.79 137.85 185.98 221.16 GDP growth (annual %) 8.9 5.3 6.2 4.6 Inflation, GDP deflator (annual %) 8.9 4.6 4.9 10.3 Agriculture, value added (% of GDP) 1 8 10 .. Industry, value added (% of GDP) 48 50 48 .. Services, etc., value added (% of GDP) 51 42 42 .. Exports of goods and services (% of GDP) 120 117 111 .. Imports of goods and services (% of GDP) 101 95 90 .. Gross capital formation (% of GDP) 27 20 22 .. Revenue, excluding grants (% of GDP) 18.5 .. .. .. Cash surplus/deficit (% of GDP) -3.0 .. .. .. According to the data of the World Bank, shown that the GDP (Gross Domestic Product) is $ 191601,000,000 Financial System Risk: Low à ¢Ã¢â€š ¬Ã‚ ¢ The insurance industry in Malaysia is regulated by the central bank, Bank Negara Malaysia. à ¢Ã¢â€š ¬Ã‚ ¢ The Malaysian government continues to support the takaful and retakaful sectors as part of its strategy to make the country a global hub for Islamic financial services Source: IMF and A.M. Best Global links Merchandise trade (% of GDP) 192.1 185.4 173.8 161.2 Net barter terms of trade index (2000 = 100) 100 102 102 104 External debt stocks, total (DOD, current US$) (millions) 41,874 51,981 61,567 66,182 Total debt service (% of exports of goods, services and income) 5.6 5.6 4.8 .. Net migration (thousands) 498 150 .. .. Workers remittances and compensation of employees, received (current US$) (millions) 342 1,117 1,570 1,329 Foreign direct investment, net inflows (BoP, current US$) (millions) 3,788 3,966 8,454 7,376 Net official development assistance and official aid received (current US$) (millions) 45 26 200 158 Economic Risk: Moderate à ¢Ã¢â€š ¬Ã‚ ¢ At independence, in the 1960s, the Malaysian economy depended upon rubber and tin. Since then, the economy has transformed to become a regional manufacturing center, services provider and offshore financial center. à ¢Ã¢â€š ¬Ã‚ ¢ The government encourages foreign investment but maintains approval rights for individual investments, often opting to restrict foreign equity or encouraging the transfer of technology from foreign firms. China: Economy 2005 2006 2006 2008 GDP (current US$) (billions) 1,198.48 2,257.07 3,505.53 4,532.79 GDP growth (annual %) 8.4 11.3 14.2 9.6 Inflation, GDP deflator (annual %) 2.1 3.9 7.6 7.8 Agriculture, value added (% of GDP) 15 12 11 11 Industry, value added (% of GDP) 46 47 47 47 Services, etc., value added (% of GDP) 39 41 42 42 Exports of goods and services (% of GDP) 23 37 38 35 Imports of goods and services (% of GDP) 21 32 30 27 Gross capital formation (% of GDP) 35 44 42 43 Revenue, excluding grants (% of GDP) .. 9.7 17.0 .. Cash surplus/deficit (% of GDP) .. -1.4 .. .. Economic Risk: Low à ¢Ã¢â€š ¬Ã‚ ¢ China, the worlds most populous country, is home to the worlds third largest economy. à ¢Ã¢â€š ¬Ã‚ ¢ Rapid growth rates are driven by a strong export sector, state expenditures, construction and infrastructure development. à ¢Ã¢â€š ¬Ã‚ ¢ The government was able to respond to global economic downturn by launching stimulus programs, which brought a strong recovery in 2010. à ¢Ã¢â€š ¬Ã‚ ¢ Expansionary policies have resulted in massive increases in bank lending, stimulating the economy but bringing rise to fears of increases in non-performing loans. Financial System Risk: Moderate à ¢Ã¢â€š ¬Ã‚ ¢ The insurance industry is regulated by the Chinese Insurance Regulatory Commission (CIRC). à ¢Ã¢â€š ¬Ã‚ ¢ China is partially liberalizing its financial sector, which is a long and drawn out process but essential for the long-term sustainability of the economy. à ¢Ã¢â€š ¬Ã‚ ¢ The Insurance Law was amended in 2009 to enhance regulation in core areas such as the strength of the supervisory authority and solvency and investment guidelines. Global links Merchandise trade (% of GDP) 39.6 63.0 62.1 56.5 Net barter terms of trade index (2000 = 100) 100 86 80 74 External debt stocks, total (DOD, current US$) (millions) 145,711 283,986 373,773 378,245 Total debt service (% of exports of goods, services and income) 9.3 3.1 2.2 2.0 Net migration (thousands) -786 -2,058 .. .. Workers remittances and compensation of employees, received (current US$) (millions) 5,237 24,102 38,791 48,524 Foreign direct investment, net inflows (BoP, current US$) (millions) 38,399 79,127 138,413 147,791 Net official development assistance and official aid received (current US$) (millions) 1,712 1,814 1,487 1,489 Social or cultures:[one more points] Religions: United Kingdom: Regional Summary: Western Europe à ¢Ã¢â€š ¬Ã‚ ¢ Western Europe is a highly developed and affluent region. The European Union (EU) is an economic and political union of 27 countries that accounts for 30% of world gross domestic product (GDP). The EU is facilitating a single European market with standardized regulatory systems and free movement of people, goods, services and capital. à ¢Ã¢â€š ¬Ã‚ ¢ The euro-zone is made up of the 16 EU members that have adopted the euro as their currency. à ¢Ã¢â€š ¬Ã‚ ¢ Most, if not all, of Western Europe has been experiencing a severe economic slowdown and several countries remain in recession. While the European Central Bank has cut interest rates to spur demand, economic growth in the region has been generally modest. People Income share held by lowest 20% .. .. .. .. Life expectancy at birth, total (years) 78 79 80 80 Fertility rate, total (births per woman) 1.6 1.8 1.9 1.9 Adolescent fertility rate (births per 1,000 women ages 15-19) 28 26 24 24 Contraceptive prevalence (% of women ages 15-49) .. .. .. .. Births attended by skilled health staff (% of total) .. .. .. .. Mortality rate, under-5 (per 1,000) 7 6 6 6 Malnutrition prevalence, weight for age (% of children under 5) .. .. .. .. Immunization, measles (% of children ages 12-23 months) 88 82 86 86 Primary completion rate, total (% of relevant age group) .. .. .. .. Ratio of girls to boys in primary and secondary education (%) 100 101 102 101 Prevalence of HIV, total (% of population ages 15-49) 0.1 0.2 0.2 .. Malaysia: Regional Summary: Southeast Asia à ¢Ã¢â€š ¬Ã‚ ¢ Southeast Asia is a critical part of the world trading system and while the regions economies remain somewhat dependent on agriculture, manufacturing and services have been the engine for growth. à ¢Ã¢â€š ¬Ã‚ ¢ The region has been remarkably resilient to the global economic slowdown. While regionally growth slowed as the economies of their large trading partners (notably the U.S. and Europe) went through recession, the slowdown was in most cases moderate and the recovery in 2010 has been very strong. People Income share held by lowest 20% .. .. .. .. Life expectancy at birth, total (years) 73 74 74 74 Fertility rate, total (births per woman) 3.0 2.7 2.6 2.6 Adolescent fertility rate (births per 1,000 women ages 15-19) 15 14 13 13 Contraceptive prevalence (% of women ages 15-49) .. .. .. .. Births attended by skilled health staff (% of total) .. 98 .. .. Mortality rate, under-5 (per 1,000) 10 8 7 6 Malnutrition prevalence, weight for age (% of children under 5) .. .. .. .. Immunization, measles (% of children ages 12-23 months) 88 90 95 95 Primary completion rate, total (% of relevant age group) .. 98 96 .. Ratio of girls to boys in primary and secondary education (%) 103 104 103 .. Prevalence of HIV, total (% of population ages 15-49) 0.3 0.5 0.5 .. China: Regional Summary: Eastern Asia à ¢Ã¢â€š ¬Ã‚ ¢ Eastern Asia is home to some of the worlds largest and most advanced economies. China and Japan are both in the worlds top five countries measured by gross domestic product (GDP). à ¢Ã¢â€š ¬Ã‚ ¢ In the aftermath of the Southeast Asian financial crisis in the late 1990s, much of the region underwent a restructuring of traditional economic and financial practices to match international best practices in regulation. à ¢Ã¢â€š ¬Ã‚ ¢ The region as a whole weathered the global financial crisis well, with local demand powered by government stimulus helping to maintain positive economic growth. People Income share held by lowest 20% ..

The Use of Alcohol in Society Essay -- essays research papers

Throughout history, society has engaged in taking substances such as alcohol, that alter our physical being or our psychological state of mind. There are many experiences and pressures that force people to feel like they have to drink in order to cope with life, but for many alcohol is a part of everyday life, just like any other beverage. Alcohol is introduced to us in many ways, through our family, television, movies, and friends’. These â€Å"sociocultural variants are at least as important as physiological and psychological variants when we are trying to understand the interrelations of alcohol and human behavior†#. How we perceive drinking and continue drinking can be determined by the drinking habits we see, either by who we drink with, or the attitudes about drinking we learn over the years. The chances of people drinking in ways that can harm others and ultimately themselves can be seen by the correlation of educational lessons, cultural beliefs and the usage o f alcohol. Looking at all the possibilities, the complex question we must ask is why do people drink? Is it through their defiance of law, the accessibility of alcohol, teachings of others or the values set in place in their society? Every society has its own views on how the consumption of alcohol should be handled and regulated. Their differences create a trickle effect of how it is used, and is distinctive to that culture or society. Many cultures drinking habits go hand in hand with religion, and social customs. Drinking alcohol is in many cases a part of extensive learned tradition, where people pride themselves with their ability to hold their liquor. In countries where alcohol is part of the â€Å"norm†, the outcomes of drinking habits or the effects of alcohol are much different, â€Å"A population that drinks daily may have a high rate of cirrhosis and other medical problems but few accidents, fights, homicides, or other violent alcohol-associated conflicts; a population with predominantly binge drinking shows the opposite complex of drinking problems†#. It has been observed that cultures with rich traditions and acceptance of alcohol use tend to deal less with the typical alcohol related p roblems, compared to the cultures who treat alcohol as an escape or something that will make them better in the eyes of others. In these societies, like the U.S. alcohol hasn’t always been present and grown to be... ... 429 3.Varley, C. (1994). Life Issues-Alcoholism. New York: Marshal   Ã‚  Ã‚  Ã‚  Ã‚  Cavendish. 4.Rorabaugh, W.J. (1979). The Alcoholic Republic: An American   Ã‚  Ã‚  Ã‚  Ã‚  Tradition. New York: Oxford University Press: 26 5.Levine, H.G. (1995).â€Å"The Good Creature of God and the Demon   Ã‚  Ã‚  Ã‚  Ã‚  Rum,† International Handbook on Alcohol and Culture.   Ã‚  Ã‚  Ã‚  Ã‚  Westport, CT: Greenwood Press: 115 6.Heath, 121 7.Heath, 436. Bibliography Claypool, J. (1981). Alcohol and You. New York: Franklin   Ã‚  Ã‚  Ã‚  Ã‚  Watts- An Impact Book. Dolmetsch, P, and Mauricette, G. (Ed). (1987). Teens Talk   Ã‚  Ã‚  Ã‚  Ã‚  About   Ã‚  Ã‚  Ã‚  Ã‚  Alcohol and Alcoholism. New York: Dolphin Book. Heath, D.B. (1982).â€Å"Sociocultural Variants in Alcoholism,†   Ã‚  Ã‚  Ã‚  Ã‚  Encyclopedic Handbook of Alcoholism. New York: Gardner   Ã‚  Ã‚  Ã‚  Ã‚  Press. Hornik, E.L. (1974). You and your Alcoholic Parent. New   Ã‚  Ã‚  Ã‚  Ã‚  York:   Ã‚  Ã‚  Ã‚  Ã‚  Association Press. Levine, H.G. (1995).â€Å"The Good Creature of God and the Demon   Ã‚  Ã‚  Ã‚  Ã‚  Rum,† International Handbook on Alcohol and Culture.   Ã‚  Ã‚  Ã‚  Ã‚  Westport, CT: Greenwood Press. Rorabaugh, W.J. (1979). The Alcoholic Republic: An American   Ã‚  Ã‚  Ã‚  Ã‚  Tradition. New York: Oxford University Press. Varley, C. (1994). Life Issues-Alcoholism. New York: Marshal   Ã‚  Ã‚  Ã‚  Ã‚  Cavendish.

Effects of Music on Counsumer Behavior

The idea of using music as a way of advertising goes all the way back to colonial times when street vendors hawked their good to the tune of a melodic chant. Of course we also know that music has been used often as a way of fixing a product in our mind. A memorable tune that â€Å"sticks in your mind† is the marketer's dream. Music that is written for a company or industry often benefits the entire industry. One of the first industry wide musical plugs (no pun intended) was for the tobacco industry through songs such as the 1836 song Think ; Smoke Tobacco, by John Ashton and Pipe de Tabac by John Hewitt.Lyrics also play an important part in the use of music as advertising. Just as a catchy tune could attack your senses, a good â€Å"jingle† or cute lyrics could become a part of society for quite some time. The power of this form of advertising is just formidable. Consumer researchers have found emotional response to advertisement, by consumers. Background music is one o f the major component influencing audience responses to certain products that they buy. Popular music in television commercials is nothing new.In fact, television advertising right from its very beginning in the early 1950s has relied heavily on music to get people’s attention, set a mood, creates the right brand image and sells the advertiser's product. The reason why is simple it works. Music plays an important role on individuals belonging to various cultural backgrounds. Music can relax us, excite us, make us want to get up and dance or simply involve ourselves by listening. That's what makes it such a powerful tool in advertising. Very often, more recognizable songs are used as background usic to set a mood or to help establish an image for the product. Early television commercials in the 1950s featured well known classical masterpieces as background music, to attract consumers towards their product. Advertisers later on expanded themselves into jazz and rhythm and blues . Soon TV commercials were featuring songs like Duke Ellington's â€Å"Satin Doll† and Gershwin's â€Å"Rhapsody in Blue† as background music to help sell a variety of different products. Music plays the following role Entertainment:Music contributes to the effectiveness of an advertisement by making it more attractive. A good ad always tries to engage the attention of an audience, and makes it entertaining for them. To an extent all music broadcasted on commercial ads as well as radio serves as a loss leader. Any music can potentially act in this role of entertainment. Moreover, the music need not necessarily be evident of any special attraction with a particular product or service in order to play an effective and useful function. Structure/Continuity: Music can be used in various structural roles.As a structural role, music helps in tying jointly a sequence of visual images and series of dramatic episodes, narrative voice-overs, and a list of product appeals. This i s the function of continuity. Memory ability: Music should be such in advertisements that it increases the Memorability of the product's name. Consumers are known to favor products which give some degree of recognition or familiarity, even if it is merely the product's name. Thus, the association of music with the identity of a certain product may greatly aid in product recall. Lyrical Language:A fourth technique of musical enhancement is the use of lyrical language. Vocal music permits the conveyance of a verbal message in a non spoken way. Language utterances can sound much less naive or self-indulgent when couched within a musical phrase rather than simply spoken. An individual can respectably sing things which would sound utterly trite if said. Targeting: Once an appropriate medium is chosen, second considerations are targeting the consumer, thereby engaging or charm those viewers who constitute the target demographic group. Music has long been identified with various social and demographic groups.Musical style therefore assists in targeting a specific market. The style may function as a socioeconomic identifier or may act as a device for addressing a specific group of audience. Authority Establishment: Music enhances to the credibility of the product in this way that establishes its authority. A simple way of establishing authority is through expert testimony. Authority may also be fostered through testimonials of non-technical authorities . Thus to an extent to succeed in advertising an audience, should also be kept in mind , advertising done must also have genuity in it.Music affects shopper time perception: Several studies indicate that music can effectively reduce anxiety, increase positive mood ratings, alleviate depression, and decrease frustration. Music has also been seen to influence consumer’s time perception. Standing in queues listening to the right kind of music makes the waiting experience more pleasant and entertaining hence reducing the perception of time in store. Music helps in making impulsive purchases: Music helps consumers associate some feelings or emotions such as joy, love, fear, hope, sexuality, fantasy and helps in developing a mood for shopping.Music also helps in creating an impulsive environment that can be extremely beneficial to the consumers in selecting a particular product. Increase brand loyalty: Music helps in enhancing brand loyalty in a way that it integrates the meaning of a message of the particular brand thus creating brand loyalty amongst the customers. Music is a positive addition to the consumer environment: Music plays an important role by creating a positive environment, under which all consumers are influenced by music.Example: When an individual enter the shop of K;N’s the jingle of the brand keeps on playing thus creating a positive effect on the consumer . Music has also been used to induce either a pleasant or unpleasant affective state and examine its Interaction wit h the affective tone of an advertisement (Gorn, Pham, ; Sin 2001). Both arousal, pleasure can be manipulated with music. Music and Congruence: Park and Young (1986) examined the effect of music (present, absent) and three types of involvement (low involvement, cognitive involvement, affective involvement) on the formation of attitudes towards a brand in the context of TV commercials.Music increased the brand attitude for subjects In the low involvement condition but had a distracting effect for those in the cognitive involvement condition. Its effect for those in the affective involvement condition was not clear. They argue that music acted as a peripheral persuasion cue. When the music was attention grabbing it pulled listener’s attention away from the message and negatively influenced recall. The no music ads performed as well or better than the musical ads in terms of recall and recognition.Thus the relationship between the fit of the mood, induced music (happy/sad) develo ped the purchase decision for the customer. USES OF DIFFERENT KINDS OF MUSIC Fast or slow music in a retail environment Research found out that people move steadily when slow rhythm music is played. Study was conducted in two supermarkets found a huge increase in sales when slow rhythm music was played: â€Å"In that study the gross sales increased from $12,112 for the fast rhythm music to $16,740 for the slow rhythm music. This is an increase of 38%. In addition to it â€Å"Customers moved slowly when soft music was played, taking 128 seconds, and faster when fast music was played, taking 109 seconds. † Same results have been observed in restaurants: customers tend to persist when the music is slow and soft. Where you don't want people to linger, you could be better off playing loud, fast tempo music especially if you run a fast-moving restaurant. But, retail environments often want their clients to stay for longer time in their stores, so softer music is more appropriate. A study discovered that customer spent almost 23% more money in a restaurant when softer music was being played.Interestingly, increase in spending came on the drinks bill (which grew by almost 51% on avg), which are the most profitable items in most restaurants. ? Loud or soft Usually, people spend much less time in the environment where louder music is played One article wrote: â€Å"A person is likely to stay in a restaurant playing soft music 20% longer than if the music is loud, with a slight increase in the amount of money spent on food and drinks. For grocery stores, it was found that the volume made no difference on how much money was spent.Another study by Caldwell and Hibbert (2002) found that when slow music was played, patrons stayed for 20% longer but also spent more on food and drink – in fact, up to 50% more. In other words, to keep your customers, keep it soft and slow. And likewise, if you want quick turnover, speed things up and keep it loud. † In bar s, where music is very loud and fast that it hinders conversation, people drink more and drink faster. An academic study found: â€Å"Environmental music was associated with an increase in alcohol consumption. †¦ Forty male beer drinkers were observed in a bar. †¦The results show that high level volume led to increased alcohol consumption and reduced the average amount of time spent by the patrons to drink their glass. † Use of hit songs and unknown songs In business and retail environments, popular music tends to be too distracting, taking people away from the task at hand, and makes them focus on the music. You want the music to â€Å"MELT† in the environment, giving a feeling of calm or energy, but not grabbing the attention of the people. â€Å"Popular or hit† music is too catchy, and causes lower purchasing in retail environments and decreased productivity in offices. The usic that should be played has to be good and very close enough to hit music that people enjoy it, but it must not be too catchy. Classical or chill outs In a study it has been found out that â€Å"Classical music† increases the amount of money people are willing to spend. Normally, people will buy more expensive goods when classical music is being played. MUSIC AND MARKETERS Marketers uses music to reach at own goal in making advertising. Marketers doing in following way: Music Exists In A Context Music does not work alone. It exists within an advertisement with complex visual, verbal, and other nonverbal stimuli.How all of these are perceived depends on the complex interaction of internal (biological) and external (social, cultural influences) factors which also affect when and how musical taste is developed. Music is primarily a cultural and social phenomenon and reflects the values and attitudes of a subculture. Sociological forces affect images and preferences about products that are desirable, and music, if it fits with those images, may enhanc e the following variables: 1) persuasion through prior learning and verbal association, 2) recall, 3) overall ad effectiveness, Preference for the product and 5) facilitation of mental images.The following-discussion will elaborate further on the topic of music as a facilitator of mental images, and its role in advertising, education, communication, psychology, and marketing. The Importance of The Role Assigned To Music In An Ad It seems that the salience of music in an ad will depend on whether the ad is primarily affective or cognitive based (Park and Young, 1986; and Holbrook and Hirschman, 1982), who the target market is, and how well the message communication goal (meaning) of the ad will fit with the music.Consequently, we suggest a tentative hierarchy of musical presence model, to define the role assigned to music in communicating the advertising message. Basically, the degree to which music is assigned a dominant role is revealed by the degree to which it will be in the fore ground, be distinctive, will be noticed, and will be more likely to be part of an affect-based ad. The degree to which music is assigned a less dominant role is the degree to which it will recede into the background, be less distinctive, be less attention-getting, and the ad will be less likely to be affect-based.This model is based on observation of about 60 advertisements on day-time T. V. , and is presented here as way of summarizing the role music plays going from a most dominant and distinctive to a barely noticeable presence, to no presence. Since many ads have a combination of cognitive and affective components, with degrees of emphasis on one or the other, the role of music will tend to follow this degree of emphasis in the advertisement. That is, all things being equal, the more salient the role music has in the ad, the more affect-based the ad is likely to be, and We less salient role music has, the more cognitive-based the ad will be.The hierarchy of musical presence mode l is suggested as follows, going from most to least salient: A. in ads where music primarily carries the entire message and meaning, music will be used in the following ways: 1. When music with lyrics carries the ad's verbal message and meaning, it has been assigned a dominant role in also providing an atmosphere, creating an image, setting a mood, and influencing affect throughout the ad. The ad will be primarily affective-based, appealing to feelings. In this case, music will always be in the foreground, with very little voice-over, if any.Sometimes music composed especially for the purpose of the ad, or a fairly well-known song for example, such as â€Å"April in Paris† (for rich French roast coffee by Maxwell House), can be used primarily to carry the message of the ad. The use of â€Å"April in Paris† reflects the age of the target market, desire for foreign travel, and its taste in style of music; 2. When the lyrics of the song do not carry the ad's message direc tly (the words are about things other than the product and do not contribute to the atmosphere or mood), but the music is in the foreground throughout the ad, and is the primary form of communication; 3. hen instrumental or electronic music (without lyrics) is in the foreground, there is almost no voice-over, and the verbal message is brief and in written form, music has also been assigned a dominant role and will provide the above-mentioned attributes; B. in ads where the message is carried primarily by a voice-over, music is used in the following ways: 1. Music is in the background, very quiet, generally not distinctive, resembles â€Å"elevator music,† and the voice-over continues throughout the ad; 2. The music background lasts for the duration of one or two short verbal phrases, usually at the end of the ad.It is used to emphasize a phrase as in a key brand attribute, or logo; 3. No music. Although most commercials use music, some research has indicated that music may di stract from message processing, and other research supports the facilitating effect of music. While musical characteristics or elements do shape overall musical meaning, a musical selection can distract or enhance message processing, if placed in an inappropriate advertising context, where the ad's intended meaning and the music are not a good.While music may enhance processing in one setting, it may distract in another. Its impact largely depends on how well it fits with the advertisement's meaning, and the audience's level and type of ad involvement. In trying to determine what musical selection fits with what advertisement, a clear communication goal of the ad is required (cognitive, affective), along with knowledge of the intended target market's musical taste, preferences, and if possible, the meanings and feelings associated with particular musical selections.Finally, it is useful to possess an understanding of the musical characteristics or elements of the designated musical selection, as these often affect the above variables. From the musical presence hierarchy model, we note through preliminary observation that the more salient music is in an ad, the more affect-based the ad is. In general, advertising practitioners have used music which was familiar with their target market, and which fit with the ad's meaning. Note that under conditions of high cognitive involvement, music is seldom used, and when used, seldom effective.How, When, Why Music Works In Imagery Production A number of studies find that music is considered as a valid facilitator of mental images. Music also has been used as a stimulus to evoke images in educational and therapeutic settings. Music used simultaneously with words and sounds was found to increase image production. Farnsworth (1976) reports that music evokes very little universally similar mental imagery beyond what appears in all cultures, such as the use of soft melodies for mothers' lullabies.He also states that in western culture most people of the same subculture have similar imagery stimulated when presented with a descriptive narrative with specific imagery using concrete words. These words used to accompany music make for powerful, learned associations, so that when we hear the â€Å"Star Spangled Banner,† we hear the words that go with it and we all tend to have similar visual imagery. Since the same music may not evoke uniform imagery among listeners, there is uncertainty regarding whether or not high and low imagery music can be 1) agreed upon, and 2) distinguished by the type of music represented.Although the designative meaning of music is made up of individual images, thoughts, and memories associated with a particular musical piece (Meyer, 1956), and is therefore frequently individualistic, musicians have often written programmatic music with titles which encourage similar imagery. For example, Mussorgsky used pizzicato strings to represent what he labeled â€Å"chicken cluckingâ €  in his â€Å"Pictures at an Exhibition. † Advertisers of course supply â€Å"labels† with verbal statements about the product (emphasized by music) and/or lyrics of jingles.It appears that prior learning and verbal associations, when paired repeatedly with certain pieces of music, are likely to evoke more nearly uniform mental imagery among listeners. In a marketing and advertising context, imagery impacts consumers' knowledge in many important ways. Imagery systems contribute to a definition of product imagery and affect how a brand â€Å"communicates† with the consumer. Imagery is a process through which sensory information is stored in working memory.Since memory imagery involves sensory and concrete representations of ideas, feelings, and memories, it can allow a visual reconstruction of an event in one's mind which has been experienced before and stored in memory. Among the variables that can produce imagery-in an advertisement are words, imagery inst ructions, and music. Stewart, Farmer, and Stannard (forthcoming) note that in those situations where image advertising uses music, the use of a musical cue provides the opportunity to elicit images, beliefs, and associations.Their forthcoming study's results indicate that music with lyrics is statistically significant in eliciting more image types of responses referring to people, actions, or setting than verbal cues. Findings in this study suggest that the musical cue is a more sensitive measure of memory than verbal product and brand cues. Another example where imagery plays a part in the degree of fit between the music and the meaning of the advertisement is in the romantic, nostalgic song â€Å"I'll Be Seeing You. Used as background for a FTD florist ad, this song may prove effective. However, if paired with the packing up of a seasonal, everyday item like a portable fan, the effect will be somewhat comical. The organization of musical elements remain the same in the song, but the context surrounding the music has changed from a romantic, nostalgic setting (a good fit in terms of imagery) to a more mundane one. Therefore imagery of the product and the ad can be affected by the f t between musical meaning and the meaning of the ad. Music Also Affects Important Mood States.When a person enters in a restaurant, supermarket, or malls for shopping, Customers when enter in shopping malls, restaurant, or supermarkets their walking pace is fast and no product catch their eye they follow their mind set. They usually do not have in good mood due to huge traffic and unpleasant noise. Music not only slow down their pace but make their mood positive which ultimately increase the sales. Music not only enhances recall for a product or an ad through an evoked image, but it may evoke a mood, feelings, emotions, and behaviors.Consumer behavior theorists have conceptualized how consumers' attitudes, affective states, and behaviors have been impacted by moods under central a nd peripheral processing, as well as affect -and behavior conditioning. Variables Affecting Mood Moods can be affected by many different variables. Gardner (1985) discusses studies of independent variables found to induce mood states, such as weather and temperature variation, positive test feedback, finding a dime in a phone booth, winning a computer game, receiving a free gift, getting cookies, and receiving good news and bad news.Participation in activities such as smiling or frowning, reading stories, and recalling or imagining emotional experiences may also induce mood changes. In view of the fact that music is a common element in commercials, and one which has a long history of mood inducement in a variety of contexts, the next section will focus on how music has been used as an independent variable to affect moods, as well as other dependent variables of interest to marketers. For brevity, this section will highlight key studies.Details on these and other studies are in Alper t and Alpert (1990) and Bruner (forthcoming). Gorn (1982) suggests that peripheral influences such as background music used in commercials may become associated with the advertised product (in memory, even if not consciously), and influence product choice through classical conditioning. Mere exposure did not lead to liking, which apparently depended on whether the target product, a pen, was presented with liked vs. disliked music.The second experiment by Gorn (1982) provided support for his hypothesis that when subjects were not in a decision-making mode; the commercial's impact appeared to be more influential in its appeal when presented with musical background as opposed to product information. He concluded that through classical conditioning, the product becomes associated with the positive feelings of liked music. ? Commercial Business Uses of Music in Advertising Business uses of music in advertising date back to the earliest days of broadcast media.In the 1920s and 1930s, mark eters like Procter and Gamble pioneered the concept of linking brand names to distinctive musical and dramatic themes. The approach was used not only in radio ads, but also in programming that the companies developed and controlled. It was later adapted to television commercials and to the enormously popular soap operas of the 1950s. Now music is used in advertising in key formats as a useful tool to sell products. Radio Two characteristics of radio give music a particularly important role.First, the medium is entirely dependent on engaging, creative audio. Second, because most listeners tune into the radio while driving or performing other activities, music helps to focus the consumer's attention on the product. Jingles, which are original tunes composed specifically to support a certain brand, are widespread in radio advertising. They are effective in enhancing recall of the brand name and key selling points. Television and Multimedia Producers of television commercials and other forms of multimedia advertising frequently purchase licensing rights to popular music.They also hire composers and lyricists to create original music. In these media, it is important for music to complement, not compete with, the visual elements of an ad. However, songs and background tunes can be more memorable than pictures and words in establishing a mood or bringing a brand image to life. Branded Entertainment or Product Placement: Rapidly growing in popularity, this is the newest way of integrating music with a business strategy. An original entertainment product, like a music video, is created by marketers to showcase their brand.The idea is to build consumers' sense of connection to a brand by engaging them with music. Coke Studio a big Success for Coke: Music is helping Coke against its competitor Pepsi in the cola war in Pakistan. By sponsoring â€Å"Coke Studio, Coke has gained major market share at Pepsi's expense, according to a report in the Wall Street Journal. Coke n ow claims 35% of market share in Pakistan; Pepsi's market share is now down to 65% from a high of 80% in 1990s which was achieved mainly through sponsorship of cricket in Pakistan.Coke Studio, sponsored by Coca Cola Pakistan, is a one-hour show that features musicians playing a distinct blend of fusion music that mixes traditional and modern styles. Helped by the media boom in Pakistan, the show has had dramatic success since it was launched three years ago. Effects of Music on Shoppers and Restaurant Patrons: According to a research people who heard music while shopping or eating at a restaurant or mall is influenced by the music and it affects what they buy and what they spend.Loudness, pace, rhythm of music effects on how long consumer spends their time in malls and restaurants, how much they purchase and how they view brands or products positively or negatively. Another research shows that departmental stores which play, top 20 music on the music chart, shoppers over 25 of those departmental stores believe that they have spent more time there and purchased more. On the other hand, departmental stores which play soft instrumental music, shoppers under 25 believe that they have spent more time shopping than they have.Therefore, these findings indicate that less preferred or unfamiliar music slows down the perceived time of the shoppers. (Yalch & Spangenberg, 1990). REFERENCES http://www. queenslandnewsagents. com. au/assets/images/MusicConsumerBehaviour. pdf www. musiccog. ohio-state. edu http://en. wikipedia. org/wiki/Songs_in_advertising http://www. acrwebsite. org/search/view-conference-proceedings. aspx? Id=7166 suit101. com southasiainvestor. com riazhaq. com pakistanlink. org

Are Entrepreneurs Born or Not - 2062 Words

Research in the field of entrepreneurship has over the years increased, yet questions and consensus over issues in the field of entrepreneurship have yet to be answered or agreed upon. (Lazenby et al., pg. 2) Issues include the definition of entrepreneurship and whether or not entrepreneurs are born or trained. In this essay the arguments involved in defining entrepreneurs will not be analysed, but specific attention will be given to the argument on whether or not entrepreneurs are born or trained. According to Reynolds et al. (2000) entrepreneurs are people who have both the will (in other words, desire or motivation) and the skill (the ability) to project their ideas or schemes into the future, and, by backing their judgement with†¦show more content†¦These include: 1. good listening skills, 2. ability to play passionate advocate, 3. broad knowledge and education, 4. sound judgement, 5. ability to separate the important things from the unimportant, 6. ability to set priorities and focus on goals, 7. pleasant scepticism. (Anonymous, 2003, pg. 2) Herb stated that vision and the ability to inspirationally communicate it others are the most important abilities required by successful entrepreneurs. Therefore according to Herb, entrepreneurs are born and trained, and require a mix of these two to become successful. The natural born characteristics of an entrepreneur are the building blocks or foundations on which entrepreneurs can build upon. (Anonymous, 2003, pg. 3-4) Entrepreneurs are born by circumstance Ââ€" where there is hunger, where there is despair, where there is desire. (Chye, pg. 1) According to Brown (1999) some people are born entrepreneurs, with or without education they will succeed, whereas no amount of education can provide business success for someone that does not have the ‘entrepreneurial spirit . (Brown, 1999, pg. 3) Skills and characteristics that entrepreneurs require include: critical thinking, reliance on experience, venture feasibility analysis, venture strategy and evaluation skills, networking, deal-making and harvesting skills. (Brown, 1999, pg. 4) Hisrich and Peters (1998, pg. 20) categorize the various skills required by entrepreneurs as:Show MoreRelatedAre Entrepreneurs Born or Made1104 Words   |  5 Pagesï » ¿Are entrepreneurs born or made? Critically discuss. Introduction An entrepreneur is a person who sets up a business by taking on financial risks in hope to make a profit. 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