World Economics assignment Essay Example for Free

World Economics assignment Essay Introduction In this report, it will introduce the World Economy. Main focus is the key feature of the global economic environment. The core economic issues that are focused on in this report are trade, international payments, exchange rates and economies undergoing change. Procedure To gather the required information to produce this report, extensive usage of the internet, various search engines and university library to understand global economics theory and current affairs. Analysis on Element 1 Firstly, international trade increased word-wide output. International trade activities have develop and explore the comparative advantages of a country, meanwhile, boost the professionalism of industries, higher efficient because of this. If the world-wide output is enhanced and comparative advantages are well-exerted, producers can obtain benefits of economies of scale, accordingly, the cost will descend and profit ascend. Secondly, it provides greater range of commodities for consumers and more choice. Customers coming from varied counties could buy commodities which are not produced domestically by the means of international trade. It contributes to enlarging purchasing market. Since, no matter the similar types of products or goods that not are able produced in domestic area, they could be got through international trade. Additionally, world trade has made an overall increase in standard of living. Specifically, a host of job vacancies offered by muti-national companies help solving the employment problem, then corporation revenue and individual revenue are elevated. Consequently, increased tax will be invested to welfare and infrastructure system. Analysis on Element 2 According to wikipedia, Free trade is a system of trade policy that allows traders to act and or transact without interference from government. According to the law of comparative advantage the policy permits trading partners mutual gains from trade of goods and services.(1) According to wikipedia, The Latin American Free Trade Association (LAFTA) was created in the 1960 Treaty of Montevideo by Argentina, Brazil, Chile, Mexico, Paraguay, Peru, and Uruguay. The signatories hoped to create a common market in Latin America and offered tariff rebates among member nations. LAFTA came into effect on January 2, 1962. When the trade association commenced it had seven members and its main goal was to eliminate all duties and restrictions on the majority of their trade within a twelve year period. By the late 1960s the area of LAFTA had a population of 220 million and produced about $90 billion of goods and services annually. By the same time it had an average per capita gross national product of $440. The goal of the LAFTA is the creation of a free trade zone in Latin America. It should foster mutual regional trade among the member states, as well as with the U.S. and the European Union.(2) Analysis on Element 3 According to wikipedia, In economics, principle of absolute advantage refers to the ability of a party (an individual, or firm, or country) to produce more of a good or service than competitors, using the same amount of resources. Adam Smith first described the principle of absolute advantage in the context of international trade, using labor as the only input(3). For instance, the capital market of UK is absolute advantage when comparing to the developing countries. According to wikipedia, The law of comparative advantage refers to the ability of a party (an individual, a firm, or a country) to produce a particular good or service at a lower opportunity cost than another party. It is the ability to produce a product with the highest relative efficiency given all the other products that could be produced(4). For instance, during the end of 19 century and beginning of 20 century, textile industry of UK developed well. However, in the middle and end of 21 century, Chinas textile industry became a comparative advantage because of enhanced efficient by means of adopting new product technologies. Analysis on Element 4 According to wikipedia, Protectionism is the economic policy of restraining trade between states, through methods such as tariffs on imported goods, restrictive quotas, and a variety of other government regulations designed to discourage imports, and prevent foreign take-over of domestic markets and companies(5). Its a practice of regulating imports and exports with the purpose of shielding domestic industries from foreign competition. Governments adopt protectionism in order to help the country become self-sufficient, to protect new industries, or as a bargaining tool. In terms of tariff which was applied in protectionism, there are two examples. On September of 2010, Chinese government enforce new import duties ranging from 50.3 to 105.4 percent on US chicken lasting for five years, since a investigation found that US chicken was being sold at low prices a process called dumping(6). Another instance is, according to the webpage, on November of 2009, Brazil would raise cane over U.S. ethanol tariff. The reason for that is Brazil sugar producers say sugar-based fuel is more environmentally sound than electricity or corn ethanol for as an alternative for powering cars(7). Analysis on Element 5 Trade barriers are constraints that tend to hinder the motivation to engage in the importing or exporting of goods(8). There are two types of barriers that a government can employ, which are Tariff barriers and Non-Tariff barriers. According to the student guide, Tariffs are taxes or customs duties placed on foreign products to artificially raise their prices and this hopefully, suppresses domestic demand for them.(9) According to wikipedia, Non-tariff barriers to trade (NTBs) are trade barriers that restrict imports but are not in the usual form of a tariff.(10) it can take many forms, including quotas, embargoes, exchange controls, import deposits, voluntary export restrains, product standard procedures, subsidies and etc. There are two instances that indicate how tariff barriers influence the global trade. According to the webpage, On September of 2010, chinas commerce ministry announced that it would impose import tariffs on American poultry of up to 105.4 percent(11). Another is, on August of 2010, Mexicos new list which includes meats, vegetables and household items face tariffs of 5 percent to 25 percent, which will hurt Texas more(12). Analysis on Element 6 In brief, according to the webpage, the World Trade Organization (WTO) is an organization which can provide a negotiating forum, offer a set of rules and helps to settle disputes for its memberships between nations. Its main function is to ensure that trade flow as smoothly, predictably and freely as possible(13). According to the publication of European Commission, on 8 December 2003, the EC requested consultations with India on 27 antidumping measures imposed on a variety of EC exports, including pharmaceuticals, chemicals, paper, textile and steel. The problems in the Indian cases mainly referred to the highly insufficient injury and causality analysis, the failure to provide meaningful disclosure documents and a continuous disregard of arguments presented by EC exporters and the EC. Following the consultations held in February 2004, India opened a review process which has led to the termination of most of the contested measures, including those of most economic interest for EC exporters (steel and pharmaceutical products)(14). Analysis on Element 7 The aims of EU are following: Firstly, Eliminate customs duties and quotas between members. Secondly, establish common external tariff for non members (operated through common commercial policy). Thirdly, establish free movement of people, service, goods and capital between members, meanwhile, reduce anti-competitive practices. Fourth, associate with countries outside union to increase trade. Further, move towards full economic and monetary union. Lastly, develop common foreign, security and defense policy(15). In respect of trade, EU has encouraged to use one single currency which promotes the development of trade. Regarding to administration, the applying of Schengen Visa decrease administrative impediments and encourage the flow of individuals and business. Moreover, it implements unified foreign policy when confronted with trade disputes. Analysis on Element 8 The Balance of Payments can effectively be broken down into two parts. According to the webpage, The Current Account records international trade in goods and service, international income flows and current transfers. The Capital Account and Financial Account form the counter part to this, recording the changing pattern in the international ownership of assets. While the Financial Account records changes in the cross-border flows of assets the international Investment Position measures the total stocks of foreign assets and liabilities held by a nation(16). The trade in goods balance is the difference between the value of goods exported and the value of goods imported. The trade in services is recorded in the same way, with credits to the Current account reflecting services exports and debits services imports. Net income flows reflect international payments associated with the ownership of the factors of production (land, labor and capital). Current transfer records a miscellaneous set of net payments including workers remittances, social security, foreign aid and contributions to international organizations(17). In 2009, the current account deficit stands atà ¯Ã‚ ¿Ã‚ ½15.5 billion. The deficit of trade in goods account falling toà ¯Ã‚ ¿Ã‚ ½81.9 billion. The trade in services account has shown a surplus of à ¯Ã‚ ¿Ã‚ ½49.9 billion. The investment income balance rose to a record level of à ¯Ã‚ ¿Ã‚ ½32 billion. The deficit of transfers account reached a record of à ¯Ã‚ ¿Ã‚ ½14.8 billion. Additionally, The capital account represented in à ¯Ã‚ ¿Ã‚ ½3.2 billion and financial account had a net inflow of à ¯Ã‚ ¿Ã‚ ½5.6 billion(18). Analysis on Element 9 According to the bar chart of trade in good and trade in services, the UK trade was fluctuated over the last 30 years. The UK trade has really only been in surplus in the very early 1980s which around à ¯Ã‚ ¿Ã‚ ½3 billion. However, after that, there has a apparent drop from 1982 to 1989 where at a bottom in minus à ¯Ã‚ ¿Ã‚ ½25 billion in 1989. Then, from 1990 to 1997, it roughly remained same which around à ¯Ã‚ ¿Ã‚ ½10 billion deficits. What is worse, the UK trade has a substantial decline which from à ¯Ã‚ ¿Ã‚ ½21 billion deficits in 1998 to à ¯Ã‚ ¿Ã‚ ½90 billion deficits in 2008 during the ten years. In 2009, the trade of good has a deficit around à ¯Ã‚ ¿Ã‚ ½81.9 billion(19). As for the trade in services, the UK has traditionally been in surplus and certainly has been so from 1976-1997. The services trade approximately remained surplus à ¯Ã‚ ¿Ã‚ ½4 billion during four years which from 1980 to 1984. Then, it peaked at à ¯Ã‚ ¿Ã‚ ½7 billion within 3 years which from 1985 to 1987 during the 1980s. From 1991 to 1997, it ascended gentlely from à ¯Ã‚ ¿Ã‚ ½4 to à ¯Ã‚ ¿Ã‚ ½11 billion deficit. However, there was a sharply growth after 2005 which from à ¯Ã‚ ¿Ã‚ ½25 billion positive to à ¯Ã‚ ¿Ã‚ ½56 billion positive in 2008. In 2009, it dropped to à ¯Ã‚ ¿Ã‚ ½49.9 billion trade in services. Analysis on Element 10 According to the wikipedia, The exchange rates between two currencies specify how much currency is worth of a foreign nations in terms of the home nations currency(20). It has two forms which are fixed exchange rate and floating exchange rate. As to the floating exchange rate, according to the student guide, if the value of currency rises imported goods will be cheaper, therefore the trade in goods is likely to move into deficit. If the value of a currency falls, domestic goods and services will be dearer in domestic markets. This should mean an improvement in trade in goods(21). With regarding to the fixed exchange rate, according to the student guide, a persistent surplus could be dealt with by measures which allow domestic consumers to feel confident to purchase more. If the domestic economy cannot respond then imports would probably increase and exports might become less competitive.(22) Therefore, it will lead to a decrease of trade in goods. If the opposite were the case, a persistent deficit then measures could be used to restrict domestic demand and also to place greater restrictions on imports.(23) Hence, an increase of trade in goods will be emerged with that. For example, it is suggested that the American government has a requirement of increasing the value of RMB (increasing the exchange rate of RMB to change dollar) in 2001. In the end of 2006, Chinese government put the policy to take the exchange rate, it means originally 100 US dollars exchange 826 RMB, now only swap about to 800 RMB. In this way, they can make use of less money to change more products of Chinese in order to offset the quota of currency. Analysis on Element 11 The single currency is usually a double edge sword, which both bring the UK government strengthens and weaknesses. Advantages: To the UK economy, keeps interest rates lower, the commitment to low inflation should allow the economies to operate lower cost. Increase foreign investment, if the UK join the single currency system, direct inward investment should be attracted because the reduction of uncertainly there is not the need to calculate demonstrate the UK pound(24). Disadvantages For the UK government, changes from old currency may be costly; the government needs spend additional money, like, purchase the new equipment and staff training. The UK government will lose the independent monetary policy, since when UK adopt the single currency, the scope for fiscal policy adjustments is restricted by need to stay within 3% of GDP(25). Analysis on Element 12 To individuals, adopting the single currency could eliminate cost on exchange currency. No matter Tourists or citizens, they do not need to care about more money will be spend because of changing exchange rate. Besides, it renders purchasers convenient and efficient shopping, most essentially, a wide range of selections of goods and considerations without additional expenditure. To the business, utilizing a single currency intensifies stiff competition among members within EU. By the contrast, it also provides corporations with increasingly opportunities and possibilities of expansion, so that these firms could produce their product to wider within EU. Whats more, it decreases the cost of foreign investment to dedicate domestically. Analysis on Element 13 According to wikipedia, Least Developed Country (LDC) is the name given to a country which, according to the United Nations, exhibits the lowest indicators of socioeconomic development, with the lowest Human Development Index ratings of all countries in the world. A country is classified as a Least Developed Country if it meets three criteria: * low-income (three-year average GNI per capita of less than US $905, which must exceed $1,086 to leave the list) * human resource weakness (based on indicators of nutrition, health, education and adult literacy) and * economic vulnerability (based on instability of agricultural production, instability of exports of goods and services, economic importance of non-traditional activities, merchandise export concentration, handicap of economic smallness, and the percentage of population displaced by natural disasters)(26) For instance, Bhutan and Maldives in Asia is confronted with several problems which include shortage of education investment, out-dated medical treatment and high incident of employment. Analysis on Element 14 NICs like Kiribati may face the problem of indebtedness. According to the student guide, As the living standards and per capital income of NICs approach those of the mature economies they will certainly find it difficult to sustain growth, they may well have benefited from aid from the World Bank or IMF. Were they clever enough to pay off all debts they might have owed externally or as close to it as they could before being exposed to some fairly fierce competition(27). In Cambodia, the unemployment is usually very high with very little industry because most people work on their own small plots of land. The social, cultural and religious patters within these countries are barriers to mobility and change(28). Analysis on Element 15 The impact of multi-national firms on NICs and LDCs may be broadly similar. The benefits have increase employment, the new methods and technology and contribute to economic growth, to name just a few. At the same time the problems have which may eliminate domestic competition, occupy the local nature resources and the profits are mainly transfer back to Home County(29). Volkswagen as the first group company into Chinese marketing, they merger the Shanghai automobile firm and established the Shanghai Volkswagen Company. The professional training designed for Chinese worker brought in the updated technology and management skills. The other instance is about Samsung Electronics. The organization install their manufactory in developing countries like India, it may use up the natural resources and give extreme detrimental environmental influences on host country. Summary All those are the 15 key elements about the world economy. At present, the global economy tends to integration, so to realize world economy is very necessary for countries, businesses, and even individuals. Reference (1) http://en.wikipedia.org/wiki/Free_trade (2) http://en.wikipedia.org/wiki/Latin_American_Integration_Assosiation (3) http://en.wikipedia.org/wiki/Absolute_advantage (4) http://en.wikipedia.org/wiki/Comparative_advantage (5) http://en.wikipedia.org/wiki/Protectionism (6)http://www.cbsnews.com/stories/2010/09/27/business/main6904479.shtml (7)http://domesticfuel.com/2010/04/06/brazil-eliminates-tariff-on-ethanol-imports/ (8)http://www.investopedia.com/articles/economics/08/tariff-trade-barrier-basics.asp (9) Economics 2: The World Economy by China Mordern Economic Publishing House Page34. (10) http://en.wikipedia.org/wiki/Non-tariff_barriers_to_trade (11) http://www.nytimes.com/2010/09/27/business/global/27yuan.html (12) http://www.mysanantonio.com/business/local/article/Mexico-s-new-tariff-list-may-hurt-Texas-621156.php (13) http://www.wto.org/english/res_e/doload_e/inbr_e.pdf (14) http://trade.ec.europa.eu/doclib/docs/2007/may/tradoc_134652.pdf (15) Economics 2: The World Economy by China Mordern Economic Publishing House Page 66. (16) http://en.wikipedia.org/wiki/Balance_of_Payments (17) http://www.statistics.gov.uk/elmr/09_09/downloads/ELMR_Sep09_Chamberlin.pdf (18) United Kingdom Balance of Payments The Pink Book (19) United Kingdom Balance of Payment-The Pink Book (20) http://en.wikipedia.org/wiki/Exchange_rate (21) Economics 2: The World Economy by China Mordern Economic Publishing House Page 91and 92. (22) Economics 2: The World Economy by China Mordern Economic Publishing House Page 103. (23) Economics 2: The World Economy by China Mordern Economic Publishing House Page 103. (24) Economics 2: The World Economy by China Mordern Economic Publishing House Page 112. (25) Economics 2: The World Economy by China Mordern Economic Publishing House Page 113. (26) http://en.wikipedia.org/wiki/Least_Developed_Country (27) Economics 2: The World Economy by China Mordern Economic Publishing House Page 134 and 135. (28) Economics 2: The World Economy by China Mordern Economic Publishing House Page 139. (29) Economics 2: The World Economy by China Mordern Economic Publishing House Page 148-149.

Food Recipe Essay -- Nutrition, Traditional Food

This chapter first enlightens definition of traditional food. Many researchers in previous studies define traditional food in many ways of thoughts. Generally, traditional food is connected with locality, whether from its ingredients, method, formulation or people who handle it. As well, some researchers address traditional food has a strong relationship with cultural and heritage of the place whereby it is produced. In addition, authenticity is an important element that contributes to the uniqueness of traditional food. As traditional food embraces culture and heritage instead of relating to authenticity hence it gives a lot of advantages to tourism industry within the country. Terengganu is chosen as a state within Malaysia, which represents the variety traditional foods that contain the elements of authenticity. Lastly, explanations about traditional food, authenticity, relationship between food and tourism along with Terengganu as an authentic food representative in Malaysia will be discussed a detail in this chapter. 2.2 Definition of Traditional Food Food is commonly acknowledged as something that contains nutritional values which beneficial to human health. On the other hand, Bassiere (1998) defined food as a component of physio-logical, psycho-sensorial, social, hygienic, and symbolic environment. The author symbolized food in different guises whereby as: (a) basis of fantasy and symbolic virtues (bread, wine and dark blood of the game); (b) communication (food sharing influence social link), class marker (champagne, wine, caviar or tripe); and (c) emblem of culinary heritage. In terms of traditional food, Iglesias et al. (2003) defined it as food which is fully elaborated from traditional ways of processing or ... ...s a strong relationship between local food and tourism as today culinary tourism has become wider and popular almost in all countries. Chen-Tsang and Jeou-Shyan (2011) commented food might be just a part of economy but marketing of food which collaborate restaurants, markets and products is the essential component of tourism. Similarly, Gustafsson et al. (2005) revealed that regional food culture is an advantage to the economy as it seems to spawn successful rural food businesses. Therefore, producers, marketers even government need to have a great effort to examine the existing culinary resources so that any potential benefits could be identified. Sound framework which taken in consideration pros and cons should be established to ensure tactical form and style of culinary tourism appropriates for certain place could be developed (Chen-Tsang and Jeou-Shyan, 2011).

Neoliberalism in Latin America Essay

From the 1930s until the 1980s state intervention and protection were key components of most Latin American economies. In these years many Latin American countries were used an Import-substitution industrialization based economy trying to reduce dependence on foreign imports and replacing them with domestic production. Due to the use of an Import-substitution industrialization based economy Latin American countries were forced to keep high tariffs to protect the private companies of their countries. This combined with many Latin America countries providing numerous government subsidized programs eventually led to the 1982 debt crisis. This debt crisis created a vacuum affect in Latin America with many of the countries taking on a new neoliberal economic model, and by the early 1990s John Charles Chasteen claims that almost every Latin American country was led by a president that was pro neoliberalism. This neoliberal economic model called for the slashing of tariffs as well as the reduction of removal of all nationalist-inspired subsides. Also following the neoliberal model, Latin American countries stopped the printing of money to slow inflation effectively undermining the functionality of their local markets. All of this was done so that a completely â€Å"free market† could be created. It was believed that this free market would not only help improve the economies of Latin American countries, but also create more personal freedoms for the people of Latin America. In the article â€Å"Neoliberalism, Neoclassicism and Economic Welfare†, John T. Harvey claims the complete opposite, arguing although a neoliberal economic model was created to produce conditions conducive to social provisioning or democratic problem solving, the exact opposite has occurred. Harvery states in his article, â€Å"Instead of growth, stability, and the narrowing of income gaps, we have seen stagnation, volatility, and increased inequality. † By researching neoliberalism a clear picture can be drawn. Neoliberalism created class stratification with the upper and middle class greatly benefiting from the new policies sanctioned by neoliberalism, while the poor continued to become more impoverished and unable to provide for themselves. Many historians argue that the neoliberal economic model was most beneficial for the small wealthy upper-class of Latin America as well as many upper-class business owners from other countries. The existence of a â€Å"free market† due to neoliberalism in Latin America created many opportunities for upper-class citizens to continue to become considerably wealthier. The upper-class benefit from neoliberalism in many ways but the two largest benefits come from the privatization of government subsidized programs and the lowering of tariffs. Not only did both of these policies line the pockets of the upper-class of Latin America but foreign investors as well. In order to balance their federal budget many Latin American governments privatized their government subsidized programs as well as cut federal jobs. First, the privatization of federal jobs allowed many upper-class citizens to take over these businesses and use them in their benefit to create capital. Former government projects such as constructing roads and government buildings were now being completed by companies that were owned by the upper-class. Prior to neoliberalism these jobs were paid out of the federal budget and were used as a way to lower unemployment by hiring more workers than were really needed. Now that private companies were doing the work efficiency was the most important thing leading to the loss of many jobs for the poor class of Latin America. In the article, â€Å"Neo-Liberalism in Latin America: Limits and Alternatives† Ian Roxborough argues that the immediate beneficiaries of the privatization of government subsidized programs and federal jobs, or what he calls real assets, were foreign investors and people with â€Å"flight cash†. This was because when these programs became privatized upper-class people from other countries as well as Latin America were able to come in and by penny cheap shares of these programs and soon to be private companies. This excrementally helped the upper-class because after they bought this stock at largely discounted prices it quickly grew in value. Clearly, lower classes that did not have extra cash could not benefit from this because they were unable to purchase any of the shares of these newly privatized commodities. This created two problems, not only did real assets of Latin America get lost to upper-class foreign investors, it also created a significantly larger wealth gap between the poor and upper-class because of the large amounts of money the upper-class made from the gains of the stock that they bought at such cheap prices. Another benefit the upper-class of Latin America and other foreign countries gained from neoliberalism was the reduction of tariffs. The reduction of Tariffs allowed foreign companies to come into Latin America and build maquiladoras. This was beneficial for the foreign investors because they could now come into Latin America where working wages were much cheaper and produce their goods at lower prices, which entail created more profit. Lower tariffs were beneficial for Latin American upper-class citizens because as the foreign companies came into Latin America they were able to invest in these companies. The ability to invest in these companies that wouldn’t have come to Latin America with the previous tariffs was just one more way people who already had money in Latin America were able to benefit even more from a neoliberal economic model. Neoliberalism also benefitted the middle class of Latin America. Chasteen argues the middle class benefited from a neoliberal economic model because of the cheap products that were produced due to the maquiladoras in Latin America as well as cheap products that were being imported to Latin America because of the newly reduced tariffs. This was very beneficial for the middle class for two reasons. First, under neoliberalism the middle class society who had money to spend, now had more choices because the large influx of items that were now being imported into Latin America. In his article, â€Å"Magical Neoliberalism†, Alberto Fuguet argues that neoliberalism was what led to amenities like large scale movies from Hollywood and other services, like fast food chains, to come to Latin America. Secondly, neoliberalism was beneficial to the middle class because with a larger selection of goods comes competition. With competition companies foreign and local now had to produce the best quality goods at the lowest price in order to continue to receive business from the middle class. Neoliberalism also benefited the middle class of Latin America because of the advancement in technology that occurred because of the privatization of water resource centers, electrical companies, and telecommunication companies. The privatization of these companies allowed them to modernize as well as make them more reliable. Some argue that neoliberalism was also beneficial for the women of Latin America. In her article â€Å"Love in the Time of Neo-Liberalism: Gender, Work, and Power in a Costa Rican Marriage†, Susan E. Mannon argues neoliberalism allowed women to gain more power and independence then they previously had. Mannon claims that neoliberalism, and the reduced tariffs that come with it, led to the creation of maquiladoras where women could seek employment. Latin American women’s new ability to gain employment in maquiladoras allowed them to earn a wage creating dual-income households. Not only did this give them more power and independence in their individual households, but the ability to buy goods also allowed them to participate in the local economy giving them more power as well. Those who stood to gain the least under a neoliberal economic model were the poor people of Latin America. This is because the privatization of state-run corporations and public service programs made them unaffordable for the poor working class, leaving many homeless and hungry. In the article, â€Å"From Democracy to Development: The Political Economy of Post-Neoliberal Reform in Latin America†, Alfred P. Montero states claims that neoliberalism leads to deepening levels of inequality, a growing percentage of people living below the poverty line, decaying infrastructure, poor access to even low-quality primary education, rising criminality, and inefficient productivity. All of these problems can be linked to privatization of government subsidized programs and the loss of government jobs. With neoliberalism the loss of jobs and government programs made unemployment skyrocket and education too expensive for much of the poor class of Latin America to afford. This lack of education is what many argue led to the problems that Montero claims such as a rise in criminal activity. Also, because neoliberalism privatizes companies that control commodities such as water, telecommunications, and electricity the poor class was unable to afford them, essentially leaving the poor of Latin America in the dark without water or electricity. Neoliberalism also led to the creation of Maquiladora’s which initially created what poor Latin American believed to be desirable jobs. Quickly the poor found out that many of these jobs did not pay a wage that was enough for a person to survive. With the poor pay of maquiladoras also came very poor working conditions that were conducive to creating injury. Omar Gil a former maquiladora worker stated in an interview that his first maquiladora job paid him a dismal forty dollars a week in working conditions that were less than safe. Omar attested that maquiladora workers were injured often because of the intense pressure of Forman’s to produce as much product as possible. Also with neoliberalism came the lack of available occupations. Due to the reduction of tariffs foreign companies were able to bring mass produced goods into Latin American countries at prices cheaper than local inhabitants were able to produce them. This created large scale unemployment and forced Latin American people into the unsafe and low paying maquiladoras. Chasteen argues that for the poor class the inability to produce goods far outweighed the benefits of being able to be a small-time consumer from the dismal wages that were earned in maquiladoras. It is clear that the neoliberal economic model is not beneficial for anyone but the wealthy elites and middle class of Latin American Countries. A neoliberal economic model became fashionably popular in Latin America because the people who were in charge were upper-class citizens and during a down turn in 1982 neoliberalism seemed like a solution due to its approach to better balance the budget of Latin American countries. Unfortunately, either the leadership of these countries assumed wrong, or just didn’t care about the wellbeing of its impoverished people, but clearly a neoliberal economic model does nothing but create a larger wealth gap, create more social stratification, and deplete living conditions for the poor even more. In the article, â€Å"Exploring the Impact of Neoliberal Economic Development on Poverty in Costa Rica: What Went Wrong? †, Paul B Lubliner argues that in order for economic prosperity to complement poverty reduction the state should have more control over the economy not less. I agree and argue by privatizing all state subsidized programs as well as depleting the amount of government jobs to almost zero Latin American countries actually went backwards in their pursuit to shorten the wealth gap as well as social stratification. Abusing your population to closer balance budget is in no way the solution to guarantee countries prosperity in the foreseeable future. Neoliberalism was clearly one sided only benefiting the rich and middle class, disfranchising each countries poor setting them back further then they were before.

Slippery Elm , A Top 100 Common Tree in North America