Predicting Economic Market Failure and Collapse in The London Housing Market and How It Compares to a Collapse in The Wider UK Housing Market – A VAR Approach
The general objective of this dissertation is to (i) test whether a collapse in the London Housing Market would affect the UK economy and (ii) see if its impact on the economy is more significant than the impact of a UK Housing Market shock. We use a Vector Auto-regressive model (VAR) to analyse how GDP, Inflation and Uncertainty might react to a shock in either the London or the UK Housing Market. To do that, we go through the Impulse Response Function (IRF) which helps us identify the sign, significance and duration of the responses of our variables to a simulated shock in one the Housing Market.
We then go through the Historical Decomposition which calculates the contribution of the housing markets to the different structural accumulated shocks of our variables; and, helps us estimate whether the results found through the IRFs make empirical sense. We expect GDP to fall, Inflation to slow down, and Uncertainty to be negatively affected. We also consider the possibility of a recession being created in the economy, if GDP growth is affected negatively for more than three quarters. Lastly, we suppose that the London Housing Market will have a more significant impact on the economy.
London Housing Market Dissertation Contents
Chapter1 – Introduction
Chapter2 – Literature Review
Chapter3 – Analysis Objectives Methodology and Data Empirical Model and the Data Identification Strategy Results Impulse Response The London Case The UK Case Historical Decomposition Comparing the London case with the UK case Sensitivity Analysis Robustness Analysis Changing the order Replacing Uncertainty with other variables Dividing the sample Results prior to 1992 Results following 1992 Comparing our two sub-samples results Critics and limitations of our model
It is the biggest plunge since the 7.0% annual drop recorded in August 2009, says ONS. “House prices in London have fallen at their fastest pace since the financial crash a decade ago as the capital bears the brunt of the nationwide torpor in the property market. Amid a dearth of potential buyers, the cost of a home in London was 4.4% lower in May than a year earlier, according to the latest official snapshot of the market from the Office for National Statistics.
The ONS said it was the biggest drop in London prices since the 7.0% annual fall recorded in August 2009 – a period that included the near-meltdown of the global banking system in the autumn of 2008” (The Guardian, 2019).
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Five Forces Model Automobile Industry Case Study Analysis
Title: Five Forces Model Automobile Industry Case Study Analysis. Michael Porter’s Five Forces Model is a simple yet effective business analysis tool that is used to determine whether a strategy has the potential to be profitable in a company’s competitive environment. When carried out in the right way, with the right tools, the Five Forces Analysis can provide invaluable insight into your business’s competition and how much power you hold in the market, so you can adjust your strategy for success. As its name suggests, there are five forces which include the intensity of rivalry, power of buyers, power of suppliers, threat of substitutes and threat of potential new entrants (Porter. 1981).
Intensity of Competitive Rivalry
The key factors that influence the intensity of rivalry in the automobile industry include the number of competitors, the brand recognition of the competitors and the frequency with which new automobile products are introduced by competitors. According to Potter’s case study the global automobile industry is highly concentrated.
However, none of the companies in the industry has achieved donation of the market. The case study indicates that about seven firms have around 10 to 15 percent of the market share. The reason for this is the high acquisition levels and collaboration activities in the global automobile industry, which minimizes competition regardless the frequency of purchase or recognition of the different brands in the industry.
As a result, the intensity of competitive rivalry in the industry is moderate. The implication of the moderate competitive intensity is that automobile firms still manage to make significant profits especially since the level of competition is suppressed by the joint ventures and alliances among automobile firms in the industry.
Power of Buyers
The factors that shape the power of customers in the automobile industry include the number of buyers in the industry, frequency of purchase, and the size of purchases. According to Potter, the global demand for cars is associated to a nation’s economic performance.
The data on Worldwide Car sales in 2016 indicate that China, which is among the top best performing economies in the world had the largest had a percentage increase of 10.7 in car sales in 2016. This demand can be viewed in the context of the wider process of a country’s economic development which leads to selective ownership that causes mass market volumes of short time cycles that reduce within mass volume causing delays in purchases or consumer changing segments.
This means that buyers demand for automobiles is determined by eternal elements that they cannot control. In this regards, the intensity of the power of buyers is moderately weak, which means, firms are still able to make reasonable profits.
Power of Suppliers
The power of suppliers is influenced by the following factors, the number of suppliers, replaceability of the supplies and the exclusivity of the supplies (Porter, 1980). Potter indicates that suppliers of the global automobile industry have become solution provider and knowledge partners with the automobile firms. Moreover, technology is increasingly becoming more intelligent enabling the suppliers to gain larger economies of scale giving them the power to bargain.
However, in the global automobile industry 33% and 17% of all suppliers have their manufacturing facilities in Eastern Europe and China respectively which raises the issue of Intellectual property rights and theft of technology. These has caused a decline in the power of mot suppliers as this trend is expanding to other parts of the world. For this reasons, the intensity of the power of suppliers is moderately strong, which means that the firms are forced to collaborate and partner with suppliers to minimize most of raw material to maximize profits.
Threat of Substitutes
Threat of substitutes in the automobile industry is determined by technology advancement, affordability and availability of potential substitutes and customer’s acceptance (Porter, 1980). According to the case study, the global automobile industry threat of substitution is mainly due to environment issues and economic consideration, where people see alternatives that are cheaper and greener.
The automobile industry contributes about 70% of the emission of CO2, and consumers are ready to take up alternatives that are more environmentally friendly. However, such substitutes are mostly provided by the same automobile firms. In this case, the intensity of threat of substitutes in the industry is weak making the industry attractive and profitable.
Threat of New Entrants
The threat of new entrants is influenced by the strength of brands of existing competitors, technology and financial requirements and entry barriers (Porter 1980). Potter indicates that there are issues related to the outward and inward direct investment that firms seek to use to expand or grow into new markets affect entry strategies adopted by these companies. However, on a positive note most governments around the world are attracting investors by providing a range of grant aid and subsidised domestic rates, but the capital and cost of production and manufacturing is quite high. For this reason the intensity of treat of new entrant is weak, which makes the industry competitive ad highly profitable.
Five Forces Model Conclusion
From the case study, it is evident that competitive rivalry in the automobile industry is moderately strong, while the buyers bargaining power is moderately weak. It is also evident that the suppliers bargaining power is moderately strong, while the threat of substitutes is weak. The threat of new entrant is weak considering that the firms in the industry have gained strong market positioning that are hard to compete with and the high investment capital needed. Based on this analysis, is evident that the automobile industry is a feasible market especially for the companies that are already operating in the market.
Porter, M. E. (1980) Competitive Strategy. New York: Free Press
Potter, N.S. The Global Automotive Industry: The Turbulence Increases
Title: Stress Management. Identifying the relationship between stress level and physical activity in humans is one of the most useful strategies. It plays an important in understanding the root cause of the problem and knowing the best approach towards dealing with it or even managing it (Wang, Feifei & Silvia, 2019). Based on my stress inventory chart, my cumulative points stand at 358 points. A critical analysis of some of the issues leading to my high point accumulation reveals the most common stressors that a normal person would undergo and experience in the course of their growth and development.
In life, we are all faced with challenges such as losing our loved ones, financial constraints, first year and final year exams in high school as well as the death of our close friends or arguments with our siblings. These experiences induce the development of stress in us as humans and some of these occurrences or activities we may have little or completely no control over.
Stress Management and Physical Activity
In an adolescent life, for example, different situations can create stress in humans. For example, arguments with siblings or parents, death of our close friends, failure in an examination, or financial difficulty can lead to the creation of a significant amount of stress in adolescent life. The relationship between physical activity and stress is therefore evident. In most cases, an increase in physical activity reduces the stress level in humans (Chisholm, Leah, 2016).
When physical activity increase, there is increased production of endorphins which improve human’s ability to sleep and therefore leading to the reduction of stress levels. Therefore, the stress level can be managed by the implementation of physical activities into stressful daily routines. Some of the specific activities that seem interesting and worth finding time include running or going for a walk, playing at the park, doing some household chores, and taking the stairs instead of using the elevator. These are simple physical activities that do not leave a person overworked but burns a high number of calories and increase blood supply to the brain leading to the reduction of stress levels in human.
Having well-defined stress management techniques is a better approach to dealing with stress. There are many strategies that an individual can adopt in dealing with stress other than physical activities (Andersson, 2016). Some of these strategies include keeping a positive attitude in life, accepting the reality of some of the stressful events and experiences that we face as humans and acknowledging that we cannot control some of them, eating a healthy and well-maintained balanced diet, learning and practicing different techniques for relaxing our mind and body lie yoga and meditation as well as learning to be assertive in life instead of being too much aggressive (Mason, 2017). These are important strategies which when practiced effectively and efficiently, will lead to the reduction of stress level when we are faced with some of the stressful events or circumstances in our life.
Andersson, Siv GE. “Stress management strategies in single bacterial cells.” Proceedings of the National Academy of Sciences 113.15 (2016): 3921-3923.
Chisholm, Leah, et al. “Physical Activity and Stress Incontinence in Women.” Current bladder dysfunction reports 14.3 (2019): 174-179.
Mason, Henry D. “Stress-management strategies among first-year students at a South African University: A qualitative study.” Journal of Student Affairs in Africa 5.2 (2017): 131-149.
Wang, Feifei, and Silvia Boros. “The relationship between physical activity, stress, life satisfaction, and sleep quality.” Journal of Physical Education and Sport 19 (2019): 227-234.
Ideology and Hegemony – The academic study of culture analyses our individual beliefs drawn from a cultural view of reality and the power positions we uphold as a result. In understanding a culture, one should obtain a viewpoint through a lens of their beliefs and examine how said beliefs are created, thus generating a cultural context. As Douglas Kellner and Meenakshi Durham summarised it “Viewing culture from political economy, from the perspective of analysis of the system of production and distribution, may disclose how the culture industries reproduce the dominant corporate and commercial culture, excluding discourses and images that contest the established social system” (2004, p.4).
With the academic field known for focusing on economic power and the subsequent enforcements, I’ve chosen to discuss the appropriate concepts of “ideology” and “hegemony” in relation to the field, and as well, to each other. The works of Karl Marx and Antonio Gramsci will be essential to my argument, which I will reinforce with the examples of the 1988 film ‘They Live’ for ideology and the widespread corporation Apple in relation to hegemony. Throughout, I will discuss the comparable link between both concepts and how they are manifested in our culture, and conclude by summarising the points made.
“Ideology as a concept is predominantly defined as “a belief or a set of beliefs, especially the political beliefs on which people, parties, or countries base their actions” (Cobuild 1987). Pioneered primarily by German philosopher Karl Marx, the Marxist theory as an entirety places a central importance on the “‘materialist’ stance that social being determines consciousness” (Chandler 1995, p.4). According to this viewpoint, ideological positions are predefined by class domination as the prevailing ideology in society is the ideology of its dominant class.
Those in overriding class position define what acceptable behaviour within a society is, summarised concisely by Marx and fellow Marxist Freidrich Engels with the statement “The ideas of the ruling class are in every epoch the ruling ideas” (Marx and Engels 2000 p.21). Through their belief in a capitalist culture, Marxism organises society into two distinguishable classes: The Proletariat; those in means of labour, and The Bourgeoisie; those owning the means of production. Moreover, the ‘false consciousness’ that Marxism recalls as ideology allows for the bourgeoisie to control a functioning system of society, where labour flow from the proletariat continues and their class struggle is kept unassuming. Ideology has a constant interplay in cultural standings particularly within the meanings and values of the media industry, but also in the government’s control over society.
The ideological messages and values of the mass media are routed deeply in our culture, in the Marxist approach to the subject it’s been long perceived that mass media, both news and entertainment forms, are “sites for the dissemination of ideology” (Croteau and Hoynes 2002 p.160), in a sense basing their notion of capitalism on the media. One textual example that demonstrates seamlessly this effect is John Carpenter’s 1988 film ‘They Live’. It sees the central protagonist discover a pair of sunglasses, upon wearing them he sees publicity billboards reading imperatives like “Obey”, and “Marry and Reproduce”. With passers-by also now appearing as robots, the narrative connotes an exaggerated yet accurate message that we as a society are governed by the ideologies that surround us.
Online blog ‘UltraCulture’ (2014) makes reference to psychoanalyst Slavoj Zizek’s (2009) review of the film “When you put the glasses on, you see the dictatorship within democracy. It is the invisible order which sustains your apparent freedom”. He likened ideology as having a relationship to our social world, one where we are addressed not as subjects of duty but of pleasures. Throughout the film, the protagonist battles the numerous capitalist robots he is exposed to. It concludes with him being victorious, allowing every member of society insight into the previously unseen ideologies surrounding them.
A Marxist commentary is notable in the text; wearing the glasses let him see the struggle for dictatorship, linked to a Marxist belief, meaning it no longer determined him, he still viewed it before but just wasn’t aware of it. The “beautifully naive mise-en-scene of ideology” (Zizek, 2009) forms the basis of this cultural text, it teaches us how as individuals in society, our desires are controlled by ideologically constructed systems such as ‘freedom’ and ‘democracy’. This gives relevance to the academic field of cultural studies as it describes the ongoing battle in our culture between wanting to revolt one ideological construct just to conform to another.
Ideology and Hegemony – Academic Culture
Although the concepts of ‘ideology’ and ‘hegemony’ are both relevant in the understanding of cultural academics, there is a key distinction between them. Ideology refers to the ideas and values reflecting the social needs of a particular group, and hegemony, in a general sense, is the dominance of one group or state over another. Ideology speaks of a set of ideas whereas hegemony describes a power relationship. Having said this, hegemony came as a development of Marxist ideology, as a concept advanced and used extensively by Italian Marxist, Antonio Gramsci. He had a fascination with the power of culture and civil society, and took to his works ‘Prison Notebooks’ to explore why the ruling class was so successful in maintaining its interests. Unlike Marx, Gramsci rejected the notion of a ‘false consciousness’, arguing the same value system would continue under the socialist mode of production unless the notion was replaced.
In his writing, reviewer Perry Anderson (1976) stressed Gramsci’s viewpoint “The fact of hegemony presupposes that account is taken of the interests and tendencies of the groups over which hegemony is to be exercised, and that a certain balance of compromise should be formed”. In other words, sacrifice is necessary from higher classes for hegemony to be overruled. The work of Gramsci has significance in today’s cultural standings, particularly when considering American culture and the overwhelming realisation of how globally widespread their movies, TV shows, fast-food chains and so on, are.
A profound cultural example, deep rooted in today’s society, is the corporate giant Apple. It could be said that the business has a potential likeness to Gramsci’s philosophy for the force it imposes on cultural society. Hegemony reflects the notion that capitalist societies use their influence to dominate social classes particularly in social and political means, however it may be argued that today it is now corporations, such as Apple, that possess this power rather than political bodies. The ever-increasing demand for new technology could potentially have brought about a new wave of capitalism. It’s plausible that Apple have gained control of this and manipulated it as a means of dominating subordinate social classes and investing itself at the heart of digital technology usage.
When the company was being developed by Steve Jobs and Steve Wozniak around the 1970 and 1980’s, research on the behalf of social psychologists Henri Tajfel and John Turner was ongoing simultaneously. They developed a theory of social identity, suggesting “self-image is defined by one’s social group”. (Dooley 2012). They recalled that it is in fact simple to turn a brand into a cult through the notion of rivalry, something the consumer giant Apple embodies. ‘Apple created an enemy, the PC and its users, and built that enemy into much of its marketing’ (Dooley 2012). In their 2006 ad campaign Apple aimed to target the perceived weakness of PC computers, as well as publicising the stylish features of their own product, the Mac, and its reflection on its users’ lifestyle.
It’s arguable that this mirrors Gramsci’s notion of hegemony; Gramsci upheld bourgeois culture as the social norm similarly how Apple promotes itself as the number one digital innovator, adding that their products enable acceptance amongst society. The hegemonic values of Apple, exuding trendiness and vitality, is essential in their approach of consumers, making them believe your identity is reflected by your choice of product. Under a Marxist viewpoint, we as consumers are the proletariats and Apple maintain a bourgeoisie status, using advertisement in their control of wealth and widespread acceptance. As political theorist Yannis Stavrakakis paraphrased, corporations such as Apple “stimulate false desires, and deepen our enslavement to consumerism and capitalist exploitation” (2006 p. 86).
To conclude, cultural studies is deeply invested in the notion that our society is marked by a struggle for power, giving the concepts of ideology and hegemony strong relevance.
Pioneering Marxists, like Marx and Engels, focused on the control that the ideological values of dominant forces have, demonstrated effectively in the textual example of ‘They Live’. The comparability of the two concepts is reflected by the development on Marxist thinking by philosopher Antonio Gramsci. His theory of cultural hegemony is particularly relevant to today’s society with corporations such as Apple. Their subtle form of manipulation, through advertisement, targets our wants and desires, something Marx and Gramsci had foreseen long before and what those in the academic field of cultural studies are continuously working on today.
Durham, M.G and Kellner, D.M (2005) Media and Cultural Studies (KeyWorks in Cultural Studies) Revised Edition. Wiley-Blackwell. p.1-29
Cobuild, C. (1987) English Language Dictionary 1st Ed. London and Glasgow. Collins.
Chandler, D. (1995) Marxist Media Theory 1st. E-book. Aberystwyth University
Marx, K. and Engels, F. (2000) The German Ideology 3rd Ed. Marx/Engels Internet Archive. p.21-61
Croteau, D.R and Hoynes W.D (2002) Media/Society: Industries, Images and Audiences 3rd Ed. SAGE Publications. p.159-193
Burke, A. (2014) Slavoj Zizek’s Masterful Commentary on John Carpenter s ‘They Live’
Zizek, S. (2009) Through the glasses darkly. Socialist review
Anderson, P. (1976) The Antinomies of Antonio Gramsci. 1st Ed. New Left Review
Dooley, R. (2012) Build Loyalty Like Apple: Define Your Enemy. Forbes
Stavrakakis, Y. (2006) Objects of Consumption, Causes of Desire: Consumerism and Advertising in Societies of Commanded Enjoyment. Gramma. p.83-103
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The Role of Women in Politics – Over the years, there has been a growing recognition of women’s untapped capacity in leadership. Women are more involved in political decision-making and implementation of laws across the globe. The rate of representation of women in parliaments has grown tremendously over the past decade. There is a growing understanding of why women’s participation in politics is significant in developing and sustaining nations as their contribution towards a better society is well documented. Women’s participation in politics has contributed a great deal towards economic growth, gender equality, advancing social rights and in enhancing health, reduce mortality and fertility rates.
Women have been advocates towards economic growth. In the past, women were considered to be insignificant in the society, and they were uneducated. Women, therefore, had low economic status, relative poverty and limited business network which their hindered economic growth. Now that more women are educated and actively involved in leadership, they can attain access to economic resources and relative financial stability (Kabeer & Natali, 2013). This has significantly increased financial security across nations since women’s skills are effectively used in utilizing economic resources. Therefore, women’s involvement in politics has contributed substantially to economic growth worldwide.
Women’s meaningful involvement in politics has boosted gender equality. Not long ago, women were only viewed as property to men and hence were not accorded equal chance in various fields such as education and leadership. They also could not own property in some societies. Downs, Reif, Hokororo and Fitzgerald (2014) note that over the years, women leaders have formed women groups and movements that have given women a voice in the struggle to have equal rights as men. These efforts have proved successful in ensuring gender equality across the world. Women now participate equally as men in the making and implementation of policies and also their rights to education and own property among others. This has enhanced women empowerment which has led to gender equality.
Women lawmakers are family-friendly in their platforms hence they tend to advance social studies. This is majorly due to the role women play as mothers and caregivers to their communities. Kabeer and Natali (2013) posit that, women leaders use their positions to help minority and often forgotten groups such as disabled people who are unrecognized by society. Women can, therefore, improve the social relations in the society since they take into consideration community concerns and are more responsive to people’s needs. These qualities of women in power encourage confidence from the people hence social relations are enhanced.
Women in politics are a tool for improved health and reduced mortality and fertility rates. This relationship is obvious since nutrition and child health fall within the remit of the woman’s household decisions. More women are educated on family planning hence they can give birth to a manageable number of children whose needs they can cater for sufficiently (Downs et al., 2014). Ultimately, strong, educated and empowered women bring up children who are equally healthy, educated and empowered. These children grow to be responsible people in the society.
Overall, when women are entrusted to lead, countries often experience higher standards of living with significant developments in economic growth, gender equality, social relations and improved health which in turn reduces mortality rates. Women are just as capable of running countries as men, so they should not shy away from this enormous task. Allowing women to take up positions in politics will also help break traditional customs that hindered developments across nations. We as a society should be ready to entrust women to power since they are agents of change in the society.
Downs, J. A., Reif, M. L. K., Hokororo, A., & Fitzgerald, D. W. (2014). Increasing women in politics and leadership in global health. Academic medicine: journal of the Association of American Medical Colleges, 89(8), 1103.
Kabeer, N., & Natali, L. (2013). Gender Equality and Economic Growth: Is there a Win‐Win?. IDS Working Papers, 2013(417), 1-58.
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