Bandar18 B200 Environment Iman

Chapter 1 - Globalisation
Globalisation has something to do with the thesis that we all live in one world, different people
have different view about globalisation some if them are:
- Sceptics
- Radical
Sceptics
Sceptics think that globalisation is all a talk even if it’s beneficial, because global
economy isn’t especially different from that which existed before.
Sceptics argue a small amount of income comes from external trade; therefore the
good deal of economic should be such as EU countries, because they trade among
themselves.
Radical
Radical are the one who agree strongly with globalization, they think that globalization
is not only real, but it is a consequent that can be felt everywhere; therefore the global
market is much better than three decades ago. The radial have western political
culture, they also think that the globalisation can result to ‘fiction’ which means
invention and creativity, an example of this can be Japan.
So, the right ideas go for whom?
- The right ideas go for radical
Why?
- Because the level of the world trade today is much higher than it was before, and
involves much wider range of goods and services and that view is totally against
than what Sceptics argue.
For example, the value of money that you have in your pocket, if you want to change it to
another currency will shift from moment to moment according to the fluctuation in such a
market.
Both Sceptics and Radical see the phenomenon of globalisation as truly & purely economic
terms; therefore globalisation is economic, political and cultural.
The mass shift in technology is an example of globalization; therefore globalization is not only
about what is ‘out there’ it is ‘in here’ phenomenon too.
Globalisation is a complex set of process not a single one but also economics and
sociological etc.
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Globalisation Advantages:
Globalisation squeezes side ways; therefore it creates new economics and cultural zones. For
example Hong Kong and Northern Italy.
Globalisation explains both why and how Soviet communist met its end, as they started felling
rapidly behind and growth went low (1970’s)
Globalisation can be defined as Americanisation or westernisation; countries such as Los

Angeles provide high technology to India.
McDonald’s and Coke are an example; therefore most of the multinational giant companies
are in USA, not because they are rich but because of the Globalisation.
Globalisation Disadvantages
People think that globalisation makes the world unfair ‘inequalities’ especially for those people
who are thinking of economic terms and free trade. Free trade can damage the surviving
economy – means that economy will change and fluctuate. Trade needs a framework, and
market cannot be created by purely economic terms.
Globalisation can sometimes hurt because it creates the world of winners and looser.
Globalisation is being not controlled especially in the USA.
The opposite word to Globalisation is Colonisation.
Colonisation: non – western countries that influence development.
Chapter 2 – Identifying Environmental Issues
To have a picture of the environment that your organisation is operating within, you need to
look at the following approaches:
- STEP Checklist – Study Adv/Dis

- Transformation Model of Input and Output
- Mintzberg’s Physiognomy
- Economic Sector Analysis
See the Module (Block) – Page 13
See the Book Environment Page 11-15
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CHAPTER 4 - CONSERVATIVE GOVERNMENT AND THE ECONOMY 1979-1997
The Policies, the Goals, and the Successes

Macroeconomic policy is made up of four important goals:
1. Low inflation rate around 2% annually
2. High economic growth measured by Gross National Product (GNP) growth rate, for
example, 4% per year
3. Low employment around 5% of active population
4. Trade balance, that is, equilibrium between the value of goods exported and goods
imported by a country
Low inflation was a priority for the UK governments between 1979 and 1997 with the
objective of increasing efficiency and wealth as measured by GNP, productivity and
purchasing power.
The average annual growth rate of the GNP in the UK was the lowest in Europe
between 1979 and 1997. However, two intermediate periods of four years each had relatively
successful economic growth in the UK but were not, to a great extent, due to macroeconomic
policy. The latter failed because of ill-conceived monetary policy, ignoring industrial planning
policy and rejecting sector intervention that could have helped the realization of a more
sustained production expansion.
The Conservatives adopted the theory of supply side economy which consisted of a
limited role for the state. Their policy ruled no dialogue with industry, not effective state
planning, no controls and no intervention favouring industrial development. However, the
New Labour party adopted in 1997 some aspects of the supply side economy of Mrs.
Margaret Thatcher, former Prime Minister. One must analyse these new policies as well as
their positive results on industrial productivity and performance.
Four major policies were implemented since 1981 by conservative governments:
(1) The Privatization and deregulation of the utilities, for example, which increased
workers productivity significantly.
(2) The Inward investment policy that succeeded in attracting the best companies in
the world to the UK.
(3) The policy of helping and encouraging small business to start, expands, and
innovates.
(4) The policy of education and of training that resulted in higher qualification and
improved productivity for workers (output per hour in manufacturing) by 3.9% per
year second to Japan only for the period between 1979 and 1994.
It was John Major and Michael Heseltine, contrary to Mrs. Thatcher, who both put the
emphasis on industrial development and competitiveness since 1992 by adopting policies
related to “Skills, training, and technological innovation”.
The emphasis was on microeconomic policy in order to help companies to innovate
and successfully compete in world markets. Microeconomics policy replaced macroeconomic
policy in fighting inflation. Companies have to be able to compete in the international area
helped by adequate institutional environment.
State intervention limited to regulation was considered by conservatives more
appropriate that a direct participation in the market and in the economy. The state should set
regulations on the economy with the intention of increasing companies’ performance.
Please try to answer the following question as an exercise and a preparation for
understanding the concepts, theories and experience related to the subject involved.
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Question 6:
Two different versions of managing the economy in order to increase productivity,
performance and competitiveness of companies dominated most of the last twenty years of
the twentieth century in the UK i.e.:
 One approach was Mrs. Thatcher’s consisting in a limited role for the state,
 And the other approach was adopted and implemented by John Major and Michael
Heseltine putting the emphasis on more state intervention but still limited to state
regulations and excluding direct interference in companies’ business.
Note: To fully understand the contents related to this question and be able to explain it
thoroughly please refer to pages 34-38 of Chapter four from B200 Reader 1:
Understanding Business: Environments.
ECONOMIC POLICIES AND INSTITUTIONAL TRANSFORMATION
Economic decline is closely related to the institutional framework of a country, to the

hostility of certain powerful groups to business and industry, to economic policy, to the
governmental measures adopted towards industry and to property rights.
Limited institutional improvements, like removing restrictions on companies’ decision-
making processes, should result in a more favourable environment in business, increasing the
financial performance of corporations. Cost reductions are then possible and new markets
are opened domestically and abroad, when firms become more competitive and profitable. A
greater flexibility is introduced in managing the economy when the private sector replaces the
state in managing business, and when firms compete within a market to perform functions like
training and negotiating with the unions. By privatizing industries and favouring market
activity, the state introduces property rights and new shareholders for government assets.
COMPANY AUTONOMY AS AN INSTITUTION

The removal of exchange controls, the reduction of heavy and constraining labour
regulations and the introduction of advantageous tax laws stimulated competition in the
markets and made corporations more efficient.
The corporation’s objectives, in the UK, consist of maximizing shareholders’ equity or
investment and ignoring other stakeholders (like employees, consumers and customers)
interests – a system close to the American practice.
A corporation, according to conservatism, should be governed fundamentally by the
interest of its shareholders hence leaving the social and labour issues completely in the
hands of the state. This approach is contrary to the German and Japanese awareness of,
and concern for the value of corporate social responsibility which integrates stakeholders'
rights and society’s interest.
The state under Conservatism remains on the sidelines concerning social issues. It
rather encourages profit maximization by firms in order to attract “inward investment” to the
UK.
Please try to answer the following question as an exercise and a preparation for
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Question 7:
Please refer to the concept of “company autonomy as an institution” and compare and
contrast the conservative models of the US and the UK to Japanese and German models
as to corporate objectives and the relationship of a corporation with its stakeholders (like
employees, consumers and customers) other than its shareholders. Discuss the relative
merits and shortcomings of these two kinds of capitalism.
Note: To fully understand the contents related to this question and be able to explain it
thoroughly please refer to pages 40-42 of Chapter four from B200 Reader 1:
Understanding Business: Environments.
CHAPTER 5 - FINANCE UNBOUND
Government macroeconomic policy deals with variables such as interest rate, public
expenditures, money supply growth, gross national product growth, the rate of inflation and so
forth. The behaviour of these variables determines economic stability or economic
disequilibrium, growth or recession.
Government policies adopted after World War II varied from fighting inflation to
favouring employment. The fight against inflation was linked to money supply management in
order to reduce the growth of credit. This fight was also related to borrowing and spending
and to controlling interest rate and exchange rates. The British government obtained mixed
results because income and global demand for goods and services in the economy
decreased, economic activity became slower, unemployment higher, and public services such
as health care and education deteriorated as drastic cuts in government expenditures took
place.
There are additional important negative effects to controlling inflation through the
reduction of money supply growth – that is, high interest rates and a stronger currency (the
British pound) internationally. An overpriced currency makes a country’s exports non-
competitive. It restricts its exports because UK domestic prices, for example, become higher
for foreigners in the rest of the world when exchange rates are costly. It also expands import
of goods and services because foreign prices become cheaper for a UK resident in
possession of an expensive pound. Lower exports and higher imports bring about a serious
deterioration of a country’s balance of trade and balance of current transactions with the rest
of the world.
On the other hand, the UK experience revealed a certain number of advantages
associated with lower inflation, that is, the purchasing power of individuals’ salaries and
wages were protected from depreciation and people’s savings value was preserved from
falling.
The UK experience also revealed how government policies and regulations can
sometimes be conflicting and globally inconsistent. The exchange and banking controls were
eliminated in 1979 and 1980 with the consequence of a substantial increase in bank credit
and individual debt. The deregulation of the financial sector increased consumer spending
considerably mainly because of an exceptional growth of money supply and bank credit.
Inflation reached almost 5% between 1983 and 1988 while the money supply’s broadest
measure expanded by approximately 15%. Inflation, though high enough at 5%, should have
been higher according to monetary theory when money supply increases by 15%. This
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contradiction is explained by the fact that inflation was held down by a high level of
unemployment and by a high exchange rate.
With the uninterrupted expansion of the bank’s consumer and mortgage credit that
finally raised inflation significantly in 1990, economic expansion was turned back into
recession with property price falling, consumption languishing and industrial competitiveness
reduced. High interest rates discouraged investment and hence reduced competitiveness
further and eroded the UK industrial base and its ability to sell goods and services abroad.
THE RECKONING
The rapid industrial productivity rise of the 1980s was favourable as such but did not
materialize in an investment boom nor in a production expansion. High interest rates made a
great deal of projects non-profitable and hence discouraged investment. A high-priced
exchange rate did not favour the balance of trade of the UK because although exports were
still rising, imports’ growth was even stronger.
It was left to the markets themselves to solve the problems of unemployment and
expansion of production as well as to find an answer to the balance of trade difficulties.
The government tried to create a more favourable environment for the manufacturing
sector by drastically reducing the strength of the trade unions. After deregulating financial
markets and institutions and abolishing exchange controls, the third important change was the
deregulation of UK’s labour market.
The objective was to obtain more freedom of action for companies’ managers and
increase industrial productivity by curbing trade unions’ influence. However, the results here
too, like in the two preceding changes intended to free the financial sector and liberate
exchange controls, were mixed.
Chapter 6 - Building a Model of the Economy
Economy could be seen as a series between two keys:

- Household that contains (Labour Power and consume Products) and Firm
- Firms (Who employ labour and make products)
Household supply workers (Labour) to the Firm
Firm Supply goods and services to the Household
See Diagram 6.1 provided on Page 56.
At the same time the flow goes opposite way round and that is:
- Firms pay the wage to the workers (Household).
- Household pay the Firm the goods they take from them.
Banks and other financial institutions come into the act.

- Household deposit money to the bank.
- Banks Lend the money (Loan) to the Firm and Household.
- Firm use this money to buy material and machinery from other firms (Firm 2)
- Firm 2 sells only for the firms not households.
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The Government is there as well, as the government taxes Households and pay benefits from
these taxes to others. Government also is taxing some firms and spending money with others.
See Diagram 6.4 provided on Page 57
Both Firms and Households are dealing with Foreign Trade buying these foreign goods and
selling these goods to foreign customers. Government and Banks are not connected with the
households and firms.
See Diagram 6.5 provided on Page 57
The four Government policy objectives are as follow:

- High and stable employment
- Rising Living Standards
- Price Stability
- A Healthy Balance of Payment
See Diagram 6.6 Page 58
Provided with explanation from the book. The Management of the UK Economy UK after the war
was aiming towards, Full Employment, economic growth, international competition and
Balance of payment plus some attention towards inflation, D & S. (Demand and Supply).
The Management of Demand
Orthodox view was to leave the matter of the unemployment and the changes of the prices to
the market force, the market would then decide, but the most important key or influential party
was Keynes his view was that cutting wages and reducing government spending will not solve
the economic problems.
In Condition of Mass Unemployment there is a Need to increase the Aggregate Demand,

Not decrease.
Aggregate Demand = g+ c + i + x - m
See Page 59 Environment Reader
If Government wanted firms to flourish, job to expand and living standard to rise then they
have to increase the flow of demand in the economic system; therefore the expansion would
not begin or start with the followings:
Export, Consumer Demand, Investment Goods and Government Spending
See Diagram 6.7 Pages 60 + Class Explanation
Multiplier effect See Page 60 + Class Explanation
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Keynesianism in Practice
The Keynesianism theory tried to prove that the government is the chief in managing the
economy, government can control the level of the income, demand and production and
therefore raise the employment, but Keynesianism had weaknesses which were highlighted
by economic and monetary theoreticians.
Difficulty Number One
1) Limited Competitiveness/ See Diagram 6.8 Page 63/ Explanation.

2) Stop Go Policy which means higher the taxes and reduce the spending in order to
reduce the demand to stop having the balance of payment problem. When the
unemployment went high the demand and prices can go to get the economic growth.
3) Keynes think that increase demand and government spending incase of
unemployment is a good idea but will cause price inflation.
The strength of the economy is affected by other factors such as:
Quality of Education, management, Social Piece and Efficiency.
Management of Supply
Liberal believe that market will pull supply and demand to equilibrium, the long term
employment lies when there is competition, it is therefore to reduce the gap between demand
and supply to avoid inflation.
The risk of inflationary comes if government push unemployment without giving concern to
demand, because if the demand went high and unemployment pushed down by government,
wage will rise, general economic price rise up.
If prices went higher to what the competitors spending can be, and then this will be a problem
for the investors because the business confidence will go down, as a result the
unemployment will raise.
Keynes think that government was a mean of high taxes and obstacles to the industries, he
cause high unemployment, this is because government cannot create jobs, private sectors
can do, but government could create conditions that firm can expand.
Monetarism thought the followings:
- Control the money supply will free inflation and will further result to economic growth.
More or less competition can lead to productivity and economic growth. This school of
thought was also convinced about the idea of investing in environment free from
inflation. Investment can be both domestic and foreign, when there is investment and
innovation the profit will raise and the domestic capital remain the country and the
demand for shares will rise.
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Chapter 8 – Living Without Borders
Moving towards a world in which capital knows no borders, government will continue to lose
control over many traditional policies e. g exchange rate and Interest Rate, which means
open to free market.
Three Major Forces in the Market Has Caused a Truly Global Market to Form
 Deregulation – the world and the business are so much concerned about this issue.
 Expansion that happened in technology and communication.
 Innovation.
The Players Affecting the Financial Market Players
1- Savers, they save money for retirement – maximum risk-
2- Investors, Bank fund managers, insurance companies as they want to gain competitive
edge to seek greater capital.
3- User Funds – Use the funds to finance investment, minimize capital cost.
4-Dealers – Transfer fund from savers to users, create new financial producer and network.
The Forces at Work Today
These are common forces that affect the work – See Your Reader
Implications of a Borderless World
See Reader on Page 78
Barriers
See Reader on Page 79
See Chapter 8 from page 76 – 80
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Chapter 9 – Global Corporation or Rival Trade Blocs?
Where is the world going to move, towards liberalism, Marxism, social reformist or
conservatism or maybe towards something totally different?
It is recommended to prepare a number of scenarios and study the factors that influence them
in order to understand future developments in international trade and economic relations
(cooperation or rivalry).
1. GLOBALIZATION VERSUS REGIONALISATION:

DIFFERENT SCENARIOS FOR THE DEVELOPMENT OF THE WORLD ECONOMY.
1.1. The Central Planning Bureau (CPB) scenarios.

Four scenarios were considered by the (CPB) for the development of the world
economy in its book “Scanning the Future”:
a. The “Global Shift” Scenario”:
Japan and the “East-Asian Economies” flourish by adopting a free-market
economy. Feeling this competitive pressure the United States take the necessary
measures to improve the overall productivity of the economy and reduce the
government budget deficit/ shortage.
The US economy recovers by increasing its productivity. Economic reforms in
Europe are still timid ("half-hearted"), this is because
Europeans behave in a rather conservative way which results in a risk-averse
behavior. Economic and industrial expansion is halted and social and political
problems arise in Europe, Europe needs to take an action.
b. In the "Europe Renaissance" scenario, ‘’Europe New Beginning’
"coordination" rather than free-market is the most important way of regulating the
economy. European integration favors business and economic growth while,
according to this scenario, the US economy weaken and its trade shortage increase
substantially.
Japan and the South-East Asians countries strengthen their business relationship
with Europe and with each other.
c. The third scenario, "Global Crisis": The US and the Europeans economies are
unable to cope with economic problems which result in economic recession. On
the opposite, the Far East economies flourish. Tensions develop on trade issues
leading to defense measures between rival economic areas. The inability of
developing countries to produce and export enough goods and services to the rest
of the world in order to feed their growing population will end up with a crisis of food
supply of great proportion. This Scenario was skipped.
d. The “Balanced Growth” scenario:
The entire world will tend to innovate, introduce many technologies, expand and
grow economically for a long time to come. Prosperity for all nations will lead to
more openness and understanding and hence to more cooperation and
agreements in international trade.
Further studies by the CPB concluded on keeping only three scenarios and
excluding the “Global Crisis” scenario because of its similar to the “Global Shift”
one.
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But one can consider finally two scenarios:
1- One in which the most important economic blocs grow approximately in the same way
and negotiate a rather open trade system,
2- And one in which economic difficulties will lead to protectionist measures and to
conflict.
I.2 The Berkeley Round Table on the International Economy (BRIE) scenarios:
Three scenarios are analysed by the BRIE:
a. The “Managed Multilaterism” scenario considers that “Power is more evenly
distributed” between nations, that governments agree on the rules that guide the
international trade relations.
b. The “Regional Rivalry” scenario will develop protectionist behaviour and

restrictive measures will be adopted instead of coordination between great
powers.
c. “Benign regionalism” scenario or “defensive protectionism concludes that

nations and regions live separately from each other. This scenario is finally
excluded because it ignores the reality of international interdepence between
blocs. Hence, only two different scenarios of interdependence would prevail.
Another way of presenting future international relations consist in presenting the following
scenarios.
The Interdepence via the International Financial Markets scenario.
International financial and currency markets are greatly integrated and efficient. They
penalise inadequate economic policies.
Irresponsible monetary, fiscal and budget policies and practices may generate inflation,
put the country’s currency under pressure and lead to a rise in interest rates with
damaging consequences on economic activity.
• The "Interdependence via the International Ecological System” scenario takes

into account the fact that pollution in one country may affect adversely the
quality of the environment in other countries (e.g. the destruction of the ozone
layer and it consequences on global warming). Hence, a scenario that
integrates the great sensitivity of environmental problems will replace the
“benign regionalism” scenario.
I.3 The “AMSTERDAM” scenarios.
Swartz has suggested adding to the “Liberal” and to the “Rivalry” scenarios a third one
dealing with important social change like a change in “basic values”. That means
scenarios should not be optimistic, it has to be pessimistic and include changes and
shift.
a. “Managed Multilateralism” that allows the introduction of new technologies,

stimulates growth and establishes more liberal rules for exchange of goods and
services internationally. It carries the vision of global village.
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b. “Regional rivalry” where moderate economic expansions are responsible for the
emergence of conflicts between trading nations.
c. “Greening of Business” with the objective of obtaining “sustainable development”
by reorganizing economies in a way that minimizes the dangers of pollution and
that allows growth to last uninterrupted.
II. INTRA-BLOC DEVELPMENTS (within the three blocs) AS A DETERMINANT OF

INTER-BLOC RELATIONS (relations between the blocs)
As the blocs evolve toward a greater unity and more cohesiveness internally, the
greater is the probability for conflicts and confrontation between them and vice-versa.
II.1 The cohesiveness of Europe.
Cohesiveness of the European Union (EU) may decrease with the enlargement
projected to Central-European Countries.
Three factors may favour European unity:
 outside pressure,
 internal dominance by Germany alone, for example, or the influence of a
coalition of states, like the Paris-Bonn axis.
• or a bargaining process among the European governments of the
EU which could be time-consuming and could slow progress.
Important new developments such as the German reunification will affect the
balance of power between the member states of the E-U and create new problems.
Among these problems remains the fact that East- Germany didn’t develop as
rapidly as expected and that very important transfer of funds are still needed to
maintain acceptable living standards for its population.
This “massive” state intervention will influence economic policy in the EU and affect
adversely the relations with the US and with Japan. The importance of "structural
internal imbalances" which cannot be solved by market forces alone is the
fundamental reason why Germany favors substantial state intervention.
The US is the champion of deregulation and liberalization. Japan is more
interventionist that the US. The EU lies in between on the matter of state
intervention in economic and trade policies. Intervention is necessary mainly when
“structural internal imbalances” cannot be worked out by market forces alone as is
the case in Germany since the integration of East Germany to the West. The fact
that Germany is more interventionist since reunification may influence the whole EU
toward a greater involvement in the economy and create problems with the US who
are free-market oriented and an advocate for deregulation.
German unification generated high costs consisting in:
 considerable transfer payments to East Germany at about 100 billion US$ per
year
 those payments represented a huge shift from investment to consumption thus
affecting in a negative way the German long-term competitiveness.
Protectionist measures against the US and Japan might follow.
 Interest rates increased because of massive borrowing to fund the huge transfer
payments, to East Germany, thus slowing and delaying economic recovery in
Germany and in Europe as compared to the US.
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II.2 An East Asian trade Bloc?
China is changing and growing rapidly. Quick changes usually do not allow for
smooth transitions and may result in political confrontation and trade conflicts.
China will always need a strong government intervention for two reasons:
1.1.c.1. because of its low level of development
1.1.c.2. because high levels of social and income inequalities require an effective
and determined state.
Japan will continue to grow but at a more moderate rhythm. Its trade with other
countries will possibly normalize for several reasons:
1.1.c.3. increasing domestic consumption
1.1.c.4. changes in work ethics
1.1.c.5. more attraction for foreign goods
1.1.c.6. less increases in productivity
Unequal economic development in China may lead to social and political unrest and
amplify internal tensions. The coastal provinces are investing and increasing and
exporting production while the other provinces are lacking the capital needed for
economic growth. The break-up of China may occur either violently affecting the world
economic activity negatively or smoothly paving the way for increased growth and
competition internationally. India is another example of unequal development and of
the possibility for internal trouble and for the dangers of a “multi-lingual, multi-religious
and multi-ethnic society”.
Developments in North America.
The North-American Free Trade agreement (NAFTA) links Canada, the US and
Mexico in economic and trade relations. However different internal social and
economic policies may strain relations between the three countries and generate
"intercontinental conflicts" and even more troubles with the two other blocs of Europe
and China. Will the end result be "more regionalization rather than globalization of the
economy"?
Section 2: Society
Are private business organizations only social responsibility to create wealth and profits or are
they responsible for satisfying the needs of a range of "stakeholders" like the consumer, the
employee and the customer? Business's behaviour toward their employees, for example, is
closely associated to the structure of society. But the problem of social inequality remains,
and is sometimes reinforced by businesses employment and management practices. The
negative consequences on economic development internally and internationally are obvious.
Cultural diversity is one of the most important and recent development in social environment
that will impact business behaviour and practice. Most important social divisions and social
inequality obstruct economic development. Businesses on the national and international
levels reinforce inequalities by using cheap and flexible workforce.
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CHAPTER 10: The structure of society
By Stuart Hall
I. SOCIAL RELATIONS.
Specific social relations (the way individuals, owners and groups behave in their
relations between themselves) constitute one of the most "distinctive structure" of a
given society.
I. SOCIAL PROCESSES
Social processes constitute another factor of great importance.
It regroups a certain number of "activities which reproduce society over time and keep
it going".
III. SOCIAL DIVISIONS
Social divisions are represented by differences between owners and employees, for example.
Social processes develop within specific institutions which allow for their change, and for their
progress. Power, represented by the state for example, is exercised within social relations.
Money and wealth exercise economic power. The state exercise considerable power in the
political arena. The law utilize a different kind of power: legal power by which the citizen has
to obey the law or face penalties if the law is not respected.
Relations, processes and divisions differentiate one society from another in terms of its
organization and design or fabric and how it "reproduces its pattern over time and space".
IV. THE SOCIAL DIVISIONS OF AGE, CLASS, "RACE"/ ETHNICITY AND GENDER.
Age is an important factor that shapes social divisions, explains conflicts of generations and
social strains and difficulties between old and young people. Social divisions are also
revealed by factors such as class, gender and "race", etnicity, inequalities and opportunities.
Social scientists took notice of the strong relationship between power (political influence or
wealth) and inequality.
Class was traditionally considered as the most relevant factor in explaining the evolution,
shaping and change of social patterns. But recently, "race" and gender are considered as the
most powerful "category" affecting all other divisions and relations.
The structure, the relations, the processes and the divisions of society are characterized by:
- regularity
- constraints
- patterns
- "continuity through time" and sustainability
- the "spatial network of processes".
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But the idea of structure is often associated with a "static" or unchanged condition. The
theory of the "agency versus structure" refers to individual and groups who are dynamic and
active and "produce" society. Another theory analyses how individuals and groups are
formed and "produced" by society.
It also refers to the structure of society, how they "limit and constrain the individual's or
group's freedom of action". Both agency and function work at the same time. The structure
of society influence human actions and behaviour and men and women "recreate" and "alter"
the structures of society by producing, building, distributing and by consuming.
Please try to answer the following questions as an exercise and preparation for understanding
the concepts, theories and experience related to the subject involved.
QUESTION 17:
Explain in detail the specific characteristics of social relations, social processes and
social divisions.
QUESTION 18:
Explain how age, class, race/etnicity and gender constitute each a significant line of
division in modern societies.
Note: To fully understand the contents related to these questions and be able to explain them
thoroughly please refer to pages 93-97 of chapter ten from B200 Reader 1: Environments.
CHAPTER 12: CHANGING SOCIAL DIVISIONS:
CLASS, GENDER AND RACE.

By Harriet Bradley
I. CLASS AND CHANGE.
I.1 Marxist and Weberian Approaches.

Marx considered the capitalistic class structure according to relations of
production. Exploitation was the main characteristic of capitalism as stated by
Marxists. Two antagonistic classes were analyzed by Marx i.e. the bourgeoisie and
the proletariat. Differences within one class were believed to be minimal with no
consequences on class structure.
On the contrary Weber saw divisions within the workforce class and within the
capitalistic class. The conflict will be different from the one between the two important
classes of bourgeoisie and proletariat because middle classes will expand and growth.
The workforce class will be influenced by bureaucratic organizations with the following
consequences:
1) "a plurality of class groupings"
2) "Fragmentation of the class structure"
i.e. of the bourgeoisie and of the proletariat.
3) "individualized and privatized orientations to society" (David Lockwood).
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The bourgeoisie class structure have broken because the ownership of capital (i.e the
shareholders) became somehow independent from its control (i.e. the management of
companies.)
The proletariat class structure have fragmented because major technological advances
has increased differences between the skilled, the semi-skilled and unskilled workers.
Social mobility and a democratic pluralistic system further fragmented the class
structure and reduced confrontation and hostility between classes.
Neo-Marxists explained that the middle classes or groupings practice some of the
"productive functions" of the proletariat and some of the functions of the bourgeoisie by
managing production and the workforce.
Neo-Marxist hence developed the notion of "structural ambiguity" or "contradictory
locations". They stress how important is class struggle but recognize that conflicts are
likely within classes, as in the Weberian theory.
They finally admit that the mass media and the education system can be mobilized to
strengthen and maintain the "status quo". This is the reason, according to Marxist, why
the working classes were unable to create a credible and effective "class
consciousness".
Table 12.1 presents an excellent summary of the Neo-Marxists and Neo-Weberian
positions and perspectives.
I.2 The Upper class.
The notion of upper class usually refers to aristocracy, bourgeoisie and manufacturers,
or "propertied class" according to Weber.
The capitalist system evolved nationally and internationally toward "concentration and
reorganization" with the creation of bigger enterprises and multinational corporations.
The upper class had split into two categories: shareholders and managers. This
situation was described by Dahrendorf as a "decomposition of capital" because on one
side are the "shareholders who owned but didn't control companies and on the other
side are managers who did not own them: ("capitalists without function" and
"functionaries without capital")".
Capital and property ownership were further spread over a greater number of people
since the 1980s either by an increase in home ownership or the acquisition of shares
by a higher percentages of the population and institutional investors.
Though this fragmentation process has reached the upper-class, the latter still have
great influence because of its substantial ownership of company shares and owing to
its contribution in management and "strategic control" of companies.
Scott considers three parts within the powerful upper class:
• entrepreneurial capitalists (large investors in shares)
• internal capitalists (top executives)
• and finance capitalists.
Ten percent of the population in Britain holds 50% of the wealth as represented by shares
and bonds and other financial securities (if pension programmes are excluded).
Male dominate the upper class and directors of companies are closely linked together, having
seats on a number of top companies. Globalization is a threat to the upper class power
because internationalization limits their influence in managing multinationals on the national
level.
16
Scott explains that the upper class should be presented as a "structure rather than an
identifiable group of people". Its power over production and over the workers has increased
rather than diminished.
I.3 The Working class.

A fraction of the working class is getting richer and more affluent, which brought about an
evolution in its culture and values and increased its "social mobility". The emergence of an
affluent "new working class" with its own way of behaving and living was an important
development after World War II. This is the thesis of "embourgeoisement" (a richer and more
prosperous working class).
On the other hand André Gorz (1982) described the characteristics of a "neo-proletariat"
made up of "the permanently unemployed, the semi-employed and casualized low-paid
workers, effectively marginalized and with no stake in the economy". For Marxists the neo-
proletariat does not belong to the working class because it is not connected to the relations of
production. Sociologists believe that long-term employment will last. Dahrendorf refers to the
underclass to describe the disadvantaged black minorities living in ghettos with no hope for
any improvement. The underclass theory was rejected by several critics who consider
"unemployment and dependency on benefits as cyclical phenomena" mainly because it is
related to the fluctuations of economic activity.
Furthermore a "recomposition "of the working class will take place. Workers will shift from the
manufacturing sectors to service industries (leisure, retailing), to "high-tech" production
sectors, and to post-industrial activities based on information technology. Daniel Bell (1974)
believes that workers will benefit from a bright future, with more leisure and opportunities and
more freedom. The affluent components of the working class will live into greater harmony,
which reminds us of the "embourgeoisement" theory.
I.4. The Middle classes:

The middle classes constitute an intermediate group made up of:
• workers in the service groups
• high-level of managers, administrators and professionals
• and the self-employed, the "petite bourgeoisie".
The middle class is growing into the more important part of the working class according to
Weberians. Marxists argue that components of the middle classes are becoming
proletarized. Women prevail in different and numerous categories of service job.
GENDER AND CHANGE
II.1. Theorizing Gender

Since World War II the proportion of women (especially married women) in the working
force has constantly increased. In spite of the fact that women are gaining more freedom,
the feminist movement of 1960 and 1970 insisted that gender inequality is still widespread
in all aspects of life.
17
Patriarchy is considered by many as responsible of gender inequality though it is not the
only approach used by analysts in this domain. Neo-Marxists analyzed gender inequality
by developing the idea of women as the "reserve army of labour".
For a certain number of authors "gender is almost always reduced to a side effect of class
"i.e. gender inequality like class differences is "a direct product" of the economic and
business organization and system. For Hartman "patriarchy is a set of social relationships
between men… that enable them to dominate women's labour power". According to
Hartman labour power is deemed to be the most important factor explaining the gender
difference, which brings us close to Marxism.
On the other hand, Walby view patriarchy as "a system of interrelated structures through
which men exploit women". But male control has changed in modern times.
The pre-industrial patriarch has disappeared giving way to lesser dominance over women.
But patriarchy is still used as a significant reference for analyzing gender.
Cluckesmann (1990) analysis considered "domestic labour: and "wage labour" as two
parts within only one system reflecting "capitalist relations of production". This chapter
analyses only one part of the sexual division of labour i.e. employment.
The post-modernism approach take into account the specificity of women conditions
resulting from different classes and from different ethnic groups. There are differences for
e.g. between black women and white women experience. Post-modernism rejects the
white feminist assumption that the experience of white women was the norm and the
reference.
II.2. Gender divisions at work

Women work is concentrated in part time jobs. It satisfies women with domestic duties
and obligations and are less tiring than a full-time job. But a part-time job has "second rate
status" and is lower paid with no benefits like a pension fund or promotion possibilities.
Women in part-time jobs are considered as a "secondary labour force". For Walby a part-
time job can be considered as a "significant form of gender segregation". Ethnic minority
women working conditions are even tougher than white women situation.
They occupy difficult, unhealthy, unskilled and low-paid jobs like in textiles or in home
work where the pay is even lower.
Women are not benefiting, as men, of generally long periods of learning and of training
("human capital"). It explains why women have less "human capital" and lower wages.
Also women received lower remuneration for similar skills. For Marxists women are
viewed by capitalists as "cheap labour" and as a "labour reserve".
Women tend to work in markets different from those where men are employed.
Fragmented labour markets and discrimination explain, in part, the sexual division of
labour.
Several other factors contribute to gender segregation while maintaining male dominance:
• insufficient resources allocated in Britain for child care.
• The fact that men describe women as "technologically incompetent" and
accordingly prevent them from benefiting from technological learning and training
and from obtaining top jobs.
II. RACE AND CHANGE
III.1 Theorizing race.
18
Immigrants are usually portrayed with distrust and unfriendliness by the British
population.
This deep hostility was highlighted by Enoch Powel in his speech given in 1968 "Rivers of
blood" and summarized in Reader 1 as follows:
"the specter of black immigrants 'swamping' the country, draining economic resources
from the indigenous population and diluting British culture" .
Immigration of black (Africans, South Asians..) and other population toward Britain was the
result of colonialism which brought about economic exchanges and labour mobility.
The great majority of British blacks are members of the working class. Their financial and
economic positions are worse than that of white workers because of racist attitudes and
prejudices.
This racist ideology proved wrong because Asian, for example, achieve more than Afro-
Caribbean's since, usually, their parents have educational qualifications.
Another concept is developed by Marxists: the "migrant labour that rather apply to
"guestworkers" in Germany and Switzerland, whose passage in these countries is only
temporary. Despite the decline of colonialism, racist mentality and power differences
made racist divisions still strong and lasting.
III.2. The changing pattern of racial inequality.

Britain needed additional manpower after World War II. Black immigrants came to Britain
occupying "dirty jobs" with low pay and poor conditions. They found themselves excluded
from access to quality housing and were concentrated in ghettos where crime and
unemployment were made worse.
Riots followed in 1958 and laws were passed in 1962 limiting rights of entry to Britain to
black immigrants making of them "second class citizens". But new laws were enacted in
1965, 1968 and 1976 establishing clearly immigration illegal in order to encourage good
race relations. But discrimination remained prevalent in employment and in housing
though the form of discrimination is less marked between white and black female. A
positive trend is the increase in self-employment in all groups but especially among some
Asian communities making them move out of the working class into the "petite
bourgeoisie". This contradicts Marxist theory that race unfavorable position or
disadvantage can be attributed to class.
Another positive development is Asian students outperforming at school and in higher
education.
QUESTION 21:
Explain how Marxists did and Weberians theorized class structure and analyzed its
impact on change by further elaborating their study in line with the upper class, the working
class and the middle classes. (To answer this question please refer to pages 112-121 of
Reader 1)
QUESTION 22:
Explain the analysis of relations between gender and change according to weberians,
Marxists and other authors. (To answer this question, please refer to pages 121 to 126 of
Reader 1)
19
QUESTION 23:
Explain the problems of race and inequality in post-war Britain and analyze how race
was theorized by several authors like Emoch Powel the Marxists, Miles, Castles, Kosak, Rex
and Parkin. (To answer this question please refer to pages 127-129 of Reader 1)
QUESTION 24:
Explain the changing pattern of racial inequality in post-man Britain. (To answer this
question, please refer to pages 129 to 132 of Reader 1)
20
CHAPTER 14: A NEW INTERNATIONAL DIVISION OF LABOUR?
By Peter Braham.
The international markets for labour and for capital are now reality especially with the
strengthening and success of globalization.
The relationship between international movements of workers and international movements of
capital constitute the object of this chapter. Multinational corporations contribute to the
development of a "new international division of labour "(NIDL) by breaking up their
manufacturing production in parts and locate some of them, when possible, in countries
where the best and profitable mix of labour and capital can be obtained.
Multinational companies operate usually in industrially advanced countries (IACs) where their
headquarters and factories are located. But when parts of their production are labour-
intensive and when they can find countries with low cost, labour multinational companies will
reduce the production of certain types of their manufacturing operations and transfer them to
foreign subsidiaries. Usually industrial corporations prefer female workers when the type of
manufacturing is "fragmented and repetitive" and when it needs "more agile hands" to
perform work especially in electronics.
A Great number of manufacturers hire female workers for additional reasons such as their
preparedness to receive lower pay and their flexibility and adaptability to spend long hours on
the assembly line. A certain number of authors consider that the new international division of
labour doesn't result in valuable transfer of technology. The latter is in reality rather simple
and limited. The sophisticated technology remains only in the hands of foreign experts
because the local worker's training is limited (generally a few weeks only of training).
In addition, according to those authors, the foreign subsidiaries of MNCs are not usually
linked or associated to the local economy. A certain number of analyses were made
criticizing this general thesis:
1) The relocation of production by MNCs is limited and constitutes a small percentage of

world-wide industrial output.
2) The MNCs do relocate certain types of manufacturing operations, not only to obtain
cheap labour but more likely to open new markets for their products.
3) The direct investment of the new international division of labour in LDCs was generally
limited. More worker training and technical innovation are needed if sophisticated
industries are to be created in LDCs. Increased productivity of workers is the most
important factor for the development of poor counties.
Please try to answer the following question as an exercise and preparation for understanding
QUESTION 27:
What are according to Frobel, the reasons and the consequences of the "new international
division of labour" (NIDL) on the location and on the distribution of manufacturing production
around the world.
thoroughly please refer to pages 147-150 of chapter 14 from B200 Reader 1: Environments
21
CHAPTER 15: CULTURE AND MANAGEMENT
By R. Armson and Al.
CULTURAL DIFFERENCES IN ATTITUDES AND VALUES.

Hofsted (1980) analyzed cultural differences based on questionnaire surveys.
The respondents were all employees of IBM, a multinational corporation, which is present in
approximately one hundred countries. All the respondents in 39 countries performed the
same tasks by "selling and servicing IBM products".
The differences were associated to cultural differences (attitudes and values) rather than
related to organizational structures.
Hofstede established the following four important differences between national cultures stated
in table 15.1:
Table 15.1 Hofstede's four dimensions:
Rating High Low
Power – distance Distant Close
Uncertainty –avoidance Risk –avoiders Risk-takers
Individualism Individualists Collectivists

Masculinity – feminity Masculine Feminine
One can refer to Insert 1(pages 152-153 of chapter 15) to find some typical survey questions.
National cultures are rated from high to lower on each of the four "cultural dimensions"
indicated in Table 15.1
a) The power-distance dimension.
The power distance dimension deals with the way superiors exercise power. In high
power-distance cultures like Japan and China the boss "should try to look as powerful
as possible".
Inequality is accepted by the people. They consider powerful people as superiors and
refrain from expressing disagreements. In low power-distance cultures such as
Sweden or Denmark inequalities are minimized. Superiors and subordinates behave
with open mindness and trust each other, practice team work and "consider each other
to be colleagues… and interdependent".
b) The uncertainty-avoidance dimension:
This dimension analyze the attitudes of people toward risk i.e. their tolerance to accept
a certain degree of risk. The proportion of people who are risk averse is greater in
developing countries like Tunisia and Portugal than in developed countries like
Switzerland and Britain. High uncertainty-avoidance means that "people feel
threatened by uncertain situations " and that they are subject to stress and anxiety in
risky circumstances or projects.
People in Tunisia and Portugal prefer to balance risk-avoidance by hardwork, career
stability and strict obedience to rules. On the contrary, for people in countries of weak
uncertainty-avoidance, risk is more easily accepted, people are more pragmatic and
more open to change.
22
c) The individualism-collectivism dimension.
In an individualist culture the entrepreneurship spirit is strong based on individual
initiative and performance. A citizen of the US or of Britain "has the right to a private
life and opinion". In a collectivist culture the group, the family or the clan prevail and
not the individual.
In Pakistan or Perou the accent is on being part of any type of organization, the
emphasis is on willing to participate in a close social framework.
d) The masculinity-feminity dimension

In "masculine" cultures money, material standards and performance are important
criteria of success and of strength in countries such as Australia and Italy.
In "feminine" cultures the quality of life, people and the environment are priorities.
These factors are predominant in the Netherlands and Sweden, for example.
In "masculine" cultures men take decision and dominate and women are expected to
be caring and nurturing.
In "feminine" cultures the society is based on equality between the sexes.
e) Interpreting the Dimensions.

A first important point to emphasize is that there are many countries in between the
"masculine" and the "feminine" culture such as Belgium which is between Britain
(rather on the "masculine" side) and France (rather on the "Feminine" side). The same
distinction has to be made concerning the uncertainty-avoidance characteristic.
A second important point to consider is that the values obtained for the different
dimensions are averages in a particular country.
f) Classifying cultures by the dimensions.

Please refer to table 15.2 where the classification of cultures take into account the forty
dimensions presented by Hofstede. They are categorized or regrouped into one of
eight "clusters".
This classification shows that, in general, a given group culture have a strong
relationship to historical development. The results seem convincing as to the influence
of culture on work attitudes.
Hofstedes research and analysis provide us with interesting explanations such as:
1) The "protestant" Germanic, Anglo and Nordic countries are characterized by low
power-distance contrary to the other countries who have high power-distance like
Algeria and South Korea.
2) Developed countries have in general lower individualism than developing countries.
This explains "their more collective orientation".
3) The organization and management of any kind of project require to answer two
important questions:
3.1 "Who has the power to decide what?"
3.2 "What rules and procedures will be allowed to attain the desired end?"
The factor of power-distance can help answer the first question and the uncertainty-avoidance
factor, the second.
23
CHAPTER 17: Power and the state
BY David Coates
Power is usually defined as the ability to shape action by individuals privately or by acting and
influencing through major institutions within the boundaries of the rule of law.
I. THE MEASUREMENT OF POWER.

This chapter is concerned with government power. It is relevant to the
interaction between government behaviour and the people. Hence, the importance to
establish clearly:
- the degree of government power in their relationship with "key centres of private
power",
- the possibilities for those without private power to benefit from government
power to repair the damages resulting from private injustices.
The degree of government power depends, mainly, on two factors:

- the way government policy is expressed and carried out,
- the way "issues are resolved in the political ground".
As long as new policies are easily implemented government power is considered

high. On the contrary, if a minister runs into difficulty while introducing a new law, his
power is deemed limited.
The sharing of political power influences two significant aspects of political life:
- the "outcome of political debate"
- and also the "agenda around which that debate is organized".
Power can be measured in several other ways too:

- how simple is it for the government to establish its own programme?
- how efficient are key interest groups to make the government consider their
interests "on their own terms"?
- how the game is being played and who is winning?
Another dimension of power deals with the question of social process. Several
important factors help understand how and "which power relationships around the
government are played ou"t:
- property rights
- market forces
- economic conditions
- legal systems
- patterns of social division
- and general cultural variables.
Trade Union's power is high when economic activity is strong and unemployment is
low, when the values and beliefs make the population prefer "collective over individual
goals".
Keynesian theory favors private industry to acquire state aid while monetarists make it
more difficult.
Salary structures, market forces and culture determine state policy as to pay rise,
working conditions and power relationships.
Trade Union power is influenced by the "visibility of union strike action".
24
This power is used with the help of trade unions strikes when the programme of
decision-making runs against them. Strikes may compensate for workers vulnerability
and help them regain part of the ground lost because of management policy and
strategies.
The following factors play against union power:
1- private ownership of companies and management power,
2- the influence of market forces in a market and competitive economy
3- the structure of the legal system when it restrains trade union activity.
4- The general attitude of the population toward the trade unions.
The following factors play in favor of union/power:

1- full employment and the perspective of a strong economic activity
2- A more open-minded population toward social problems and workers protection.
3- Advantageous labour laws.
But, history teaches that the force playing against union power prevail most of the time.
CHAPTER 18: PUTTING THE ADVANCED CAPITALIST STATE IN PERSPECTVE

By Anthony Mc Grew
The post war period witnessed a massive expansion of the State Apparatus and State Activity
in all Western Societies. Does this expansion represent an accretion of power by the State in
Capitalist Societies? Or is it a sign of weak State unable to resist societal demands? In
whose interests does the ACS-(Advanced Capitalist State) rule?
Society-Centered Approaches
- Approaches of society that is centered around the society.
- It represents the central core of "society-based approaches" to the advanced capitalist
state (ACS).
- They consider that the autonomous power of the (ACS) advanced capitalist state is
severely compromised by its dependence upon dominant socio-economic groups for the
political and economic resources essential to its continued survival.
State-Centered Approaches
- Approaches of society that is centered around the State.
- The autonomous power of the state, its ability to articulate and pursue actions and
policies which can run counter to the interest of the most powerful groups (classes) in
society.
Neo-Marxist Weberian/Pluralist
Society-centered Structured and instrumental Elitist (mills)
account (Miliband, Poulantz) Neo-Pluralism (lindblam, Dohl)
(Neo) corporatism (lehmranch) new
right (neo-instituionalism)
25
State Autonomy and State Power
- One way in which these two distinctive approaches can be reconciled is by
acknowledging the significant differences between ACS in terms of the
resources (administrative, political, coercive, financial, ideological, knowledge),
capacities and instruments of state power.
Question 34:
What is a Society-Centered Approach?
Question 35:
What is a State-Centered Approach?
CHAPTER 19: GOVERNMENT-BUSINESS RELATIONS IN JAPAN AND KOREA

By Min Chen
I. INTRODUCTION
The Japanese and Korean governments transformed the economy significantly and
increased production growth in a sizable way by shaping the economic landscape in two
ways:
1. by developing industrial policies,
2. and by encouraging close relationships between the State, strategic industries
and big business and finance
II. HISTORICAL PERSPECTIVE OF GOVERNMENT-BUSINESS RELATIONS:

JAPAN
The Meiji restoration in 1868 (with an objective of rapid modernization of Japan) was a
reaction to the application of unequal commercial treaties in 1858 and 1866 depriving Japan
from tariff protection and submerging the country with the flood of imports.
The Meiji reform facilitated the funding of strategic industries investments and developments.
Later these state enterprises were privatized at low prices, around 1880, by regrouping them
in large industrial and financial combines called ZAIBATSU.
The military defeat of Japan in 1945 lead to the destruction of the structure of the "vertically-
linked" ZAIBATSU, responsible for war preparations. These huge companies were replaced
by giant oligopoly firms "horizontally-linked" called KEIRETSUS.
Mitsubishi Corporation is one of the most important KEIRETSUS in Japan.
The objectives of KEIRETSUS were and still are to focus on economic and technology
developments instead of expanding military activities.
A powerful association was created again between government (who granted favors and
subsidies to economic development) and big business.
26
Korea
The Korean government began to offer, in the 1950s, important concessions to industry,
mainly;
• import licenses,
• foreign exchanges at favorable rates
• governmental properties
The Korean match of Japan's MITI (Ministry of International Trade and Industry) is the
Ministry of Trade and Industry (MITI) which contributed to the government policies and
strategies in creating and implementing new industrial activities. The government controlled
bank credit and set economic plans and targets.
The powerful industrial firms called CHAEBOLS created the federation of Korean Industries.
They achieved rapid expansion after the 1960s and were able to develop according to their
own forces by the mid-1970s.
The government encouraged some private firms (forcefully) to list their stocks on the stock
market and tried to limit the "excessive growth of CHAEBOLS" by controlling bank credits to
big business. But still, the share of the 10 largest CHAEBOLS in the industrial sector grew
from 21.8% in 1975 to 24.2% in 1982.
The economic experience of the 1970s and 1980s indicated that CHAEBOLS and the private
sector should be less dependent on the state and should take more initiatives.
The economic intervention of the Japanese and of the Korean States influenced business
positively and allowed both countries to catch up with modern economies.
GOVERNMENT BUSINESS RELATIONS IN JAPAN

The three major players
a) Bureaucracy
The Ministry of International Trade and Industry, created in 1949 is the most dynamic
and efficient government body operating in different areas such as:
1- The conception of Japan's "industrial policy-making process",
2- The country's strategies for development,
3- The implementation of the structuring of industry
4- And the "coordination of Japan's foreign trade and commercial ties".
The Ministry of Finance (MOF) is also a major player in developing Japan by using
budgetary process, low credit cost and tax incentives.
b) Business
Institutions like the Japan Chamber of Commerce and Industry KEIDANREN influence
government considerably with a well-known example being the merger of the
Democratic Party and the Liberal party to create the LDP (Liberal Democratic Party) in
1955.
The KEIRETSUS (the large industrial groups) are diversified in different industrial
activities and constitute approximately one-third of the total economy. Then, the
subcontractors and parts suppliers represent the bulk of the manufacturing companies
in Japan, with usually less than a hundred employees
27
c) The LDP
The LDP guaranteed close and durable government-industry collaboration for the
development of the Japanese economy. This political party is made up of several
factions. It elects a president for two years who access automatically to the post of
prime Minister "due to the LDP's majority in the Diet".
The LDP plays a major role in bringing bureaucracy and business together and in
maintaining a close relationship between the party and the two other members of the
triangle. Bureaucrats who retire move into the LDP and into corporations in the Private
sector.
This triangular relationships between the LDP, bureaucrats and private sector are
"characterized by interdependence" (see figure 19.1). the practice of this relationship
is not always easy because each member has it own special interests and because
corruption is widespread, each side trying to benefit most.
Industrial policy instruments
The postwar industrial policy of reconstruction was always a priority in Japan. But the
objectives changed from "government industrial guidance model" consisting in large
subsidies, preferential capital and licence allocation to "private sector industrial
guidance model" in which MITI's influence over the economy decreased steadily.
The governmental purchasing policies of goods and services were consistent with the
objectives of development and industrial policies. MITI encouraged the organization of
cartels to influence Japan's investment, production and expansion, and encourage
rationalization of output and boost efficiency of production.
But, the numbers of cartels were reduced by half between 1970 and 1980 because of
public pressure. The Fair Trade Commission limited their monopoly. The government
objectives vis a vis the cartels evolved in two directions:
1) by making them protect the environment more than they used to ,
2) by encouraging them to take care of small and medium-sized enterprises and
protect them from the huge Keiretsu.
GOVERNMENT BUSINESS RELATIONS IN SOUTH KOREA

Government Domination
The Korean government was always very active interfering in the economy and in business
activities in the private sector. The government controlled commercial banks, monetary policy
and credit. It also regulated prices and wages until the beginning of the 1980s and influenced
entry or exit of private companies to and from a certain number of sectors in the economy.
The Korean government encouraged the development of export-oriented companies and

granted them substantial advantages like favorable tax treatment.
The law of Monopoly Regulation and Fair Trade limited corruption and monopolistic particles.
The government favoritism was criticized in the mid- 1980s and its heavy intervention in the
economy was also curbed due to public protest.
28
Government and the birth of CHAEBOLS
The Korean government used incentives and privileges to help CHAEBOLS develop and
prosper.
A number of measures were adopted to increase CHAEBOLS' wealth and influence such as:
1) the sale of "enemy property" (i.e the Japanese industrial companies left behind in
1945) which helped several CHAEBOLS start and expand their activities considerably.
2) The control of commercial banks credit
3) Cheap bank loans
4) Subsidized bank credit
5) Tax incentives and favorable tariff policy
6) Wage control
7) Control of labor unions.
8) Funding from government's development fund.
Excessive indebtness with reasonable interest rates lowered the cost of capital but increased
financial risk and the probability of bankruptcy of corporations. These advantages were
added to the ones the corporations already benefited substantially from OTHER forms of
government and financial help.
The debt-equity ratio was very high and reached an amazing 14:1 for the Hanjin CHAEBOL
(average: 5.1:1)
The Role of CHAEBOLS
The CHAEBOLS helped significantly to implement the industrial development policies and
strategies of the Korean government. The CHAEBOLS were created by leaders exceptionally
gifted, with broad vision and great will to achieve the objective of rapid growth and great
wealth.
This latter objective obliged the CHAEBOLS to enter into new kind of businesses and to
search continuously for new opportunities into new products and new markets in order to
maintain high growth rates.
CHAEBOLS used to have monopolistic behaviour but had also positive aspects on the overall
economy because:
1) they were risk-takers daring to invest in vast risky projects,
2) they were "much less bureaucratic, more flexible and dynamic than large state
enterprises"
3) they competed successfully with multinationals
4) and they introduced rapidly and successfully new technology into the industrial sector.
29
Question 36:
Analyze the historical perspective of government-business relations in the case of Korea
(1950-1990s)
Question 37:
Describe the government-business relations in Japan by studying: 1) The contribution of the
major players. 2) The dynamics of the triangular relationships. 3) and the industrial policy
instruments.
Question 38:
Explain the government-business relations in South Korea by analyzing:
1) Government domination in the role of regulator and supporter of business.
2) The contribution of the government in the birth of CHAEBOLS.
3) The significant role played by CHAEBOLS founders.
thoroughly please refer to pages 193-203 of chapter 19 from B200 Reader 1: Environments.
CHAPTER 21:
GLOBALIZATION AND THE ADVANCED CAPITALIST STATE
By Anthony McGrew
The limit between international and domestic activate is unclear since the 1980s because of
globalization.
Globalization is characterized by several features:

a) "the reordering of time and distance in our lives"
b) the "dynamic processes" that are at work resulting in interaction,
interconnectedness and interdependence across countries and people.
c) The two dimensions of scope (extent or "stretching") and intensity (strength
or "deepening").
The modern world is characterized by the important impact of global forces and competition in
the reorganization of the world. The productions, economic and financial systems across
countries are increasingly integrated. Capital move freely and rapidly from one developed
country to another in search for the most attractive rate of return.
30
International competition is intensifying since globalization brought with it the restructuring of
the economies of the Advanced Industrial States. The deregulation of national financial
markets along with the restructuring of the economies increased the influence of global forces
and hence reduced the capacity of the states to intervene and to regulate the economy,
national labour movements, monetary policy and the welfare system. In this new world of
mounting international interdependence and growing international cooperation the
"effectiveness of national governments" is reduced. The state elites are becoming more
international as the globalization of production and exchange is increasing.
International institutions like the IMF, the World Bank, The World Trade Organization and the
Organization of Economic cooperation and Development and informal institution like the G7
facilitate international cooperation, transnational cooperation, business and activities.
They also help solve problems of international dimensions related to defense, to global
finance and to drug addiction and global trade in narcotics.
Please try to answer the following question as an exercise and preparation for
Question 40:
Explain why advanced capitalistic states are increasingly subject to globalizing forces and
how the forces impose important constraints on state sovereignty and influence the daily life
of citizen
CHAPTER 22:
CREATING THE CORPORATE FUTURE
- Analysis
The basic method of inquiry which includes:
1) Taking a part the thing to be understood
2) Trying to understand the behavior of the parts taken separately
3) Trying to assemble this understanding into an understanding of the whole.
- Reductionism:
The belief in elements is a fundamental underpinning or the machine-age view of the world.
The Process of taking things apart conceptually or physically to understand it.
- Determinism:
The process of identifying the parts-understanding them.
Everything has to be taken as the effect of some cause, otherwise occurring by either
chance or choice.
- Mechanism:
31
The concept of the universe that derives from the exclusive use of analysis and the
doctrines of reductionism.
The world was viewed as a machine.
- The Industrial Revolution:

This revolution had to do with the replacement of man by man-made (Manufactured)
machines as a source of work.
A machine was considered any object that could be used to apply energy to matter.
- The Systems AGE

The emerging area of things in the system such as the "Machine" AGE.
The Age of the Changing things in the system.
- The Nature of System

A System: is a set of two or more elements that satisfies the following 3 conditions:
1) The behavior of each element has an effect on the behavior of the whole example: (the
human body with the parts/organs each has an effect).
2) The behavior of the elements and these effects on the whole are interdependent.
Each element behavior and the way it affects the whole depends on how at least one other
element behaves.
3) However subgroups of the elements are formed, each has an effect on the behavior of
the whole and none has and independent effect on it.
The elements of a system are so connected that independent subgroups of them can't be
formed.
- Systems Thinking
Systems thinking reverse the Three-stage order of Machine-age thinking:
1) Decomposition of that which is to be explained
2) Explanation of the behavior or preparation of the parts taken separately
3) Aggregating these explanations into an explanation of the whole.
In the Systems approach there are also three steps:
1) Identify a containing whole (system) of which the thing to be explained is a part.
2) Explain the behavior or properties of the containing whole.
3) Then explain the behavior or properties of the thing to be explained in terms of its role(s)
or function(s) within its containing whole.
In analyzed thinking the thing to be explained is treated as a whole to be taken apart.
In synthetic thinking the thing to be explained is treated as a part of whole system.
Development of this complementarity is a major task of systems thinking.

• Synthesis focuses on function: it reveals why things operate as they do. Ease
understanding, it enable use to explain.
• Analysis focuses on structure; it reveals how things work, yields knowledge. It
enable us to describe.
32
In systems thinking, increases in understanding are believed to be obtainable by expanding
the systems to be understood, not by reducing them to their elements.
Understanding proceeds from the whole to its parts, not from the parts to the whole as
knowledge does.
- Expansionism
The doctrine of expansionism has a major effect on the way we go about trying to solve
problems.
Example: in the machine age, when something did not work satisfactorily, we looked for
improvement by manipulating the behavior of its parts, we looked for solutions from within
and worked our way out from the interior only when we failed there.
In the system age, we look for solutions from without and work our way in when we fail
there.
- Producer-product
The American Philosopher E.A. Singer Jr. used produced-product rather than the cause-
effect.
E.A. Singer showed by reasoning that it is too complicated to reproduce here that in the
producer-product-based view of the world, such concepts as (choice, purpose, and free will)
could be made operationally and objectively meaningful.
- Teleology:
Meaning the study of evidences of design in nature,
• a doctrine that ends are immanent in nature
• a doctrine explaining phenomena by final causes.
A System's end-goals, objectives, and ideals-could be established as objectively as the
number of elements it contained. This made it possible to look at systems teleological, in an
output-oriented way, rather than deterministically, in an input-oriented way.
Systems-oriented investigators focus on teleological (goal seeking purposeful) systems.
- The Postindustrial Revolution
The conversion of the industrial Revolution into what has come to be called the
Postindustrial Revolution has its origins in the last century.
Automation (techniques of making a system operate) has to do with replacement of mind.
Mechanization (to make mechanical, to equip with machinery especially to replace human
labor) has to do with replacement of muscle.
Automation is to Postindustrial revolution what mechanization was to the industrial
revolution.
Question 41:
Describe the following:
a. Analysis B. Reductionism c. Determinism
d. Mechanism
Question 42:
What is the Industrial Revolution?
33
Question 43:
What are the steps and stages of Systems Thinking Approach?
34
CHAPTER 23:
DANIEL BELL AND THE INFORMAITON SOCIETY
"The idea that we are moving toward an information society took root in the USA in the 1960's
in the context of rising prosperity, the automation of the workplace, an age of economic plenty
and on assumption that the demise of repetitive, unsatisfying work was imminent".
Daniel Bell wrote above the "Coming of Post-Industrial society" in 1973 identified three stages
of economic progress:
1) The pre-industrial (dominated by Agriculture)
2) The Industrial (dominated by Manufacturing)
3) The Post-industrial (dominated by the Service Sector)
Bell's analysis of the shift to the service sector includes:

1) the kind of work which people do
2) changes in the occupational structure (the decline of blue and rise of white color
workers)
3) A focus on who controls the new key resources (entrepreneurs give way to knowledge
elites).
Criticisms of the Information society

1) Is it (information technology)as central to contemporary society as is suggested?
The claims which were made for preceding technology (TV and Radio) were seen
as media which will expose everyone to the "spoken" word, great literature,
drama…
2) "Is the criticism that it is not a march of progress from the primary, through the
secondary to the tertiary sector? Rather much of the service (Tertiary) sector has
grown because of a growth in manufacturing, rather than as a replacement for it".
3) "Is the empirical evidence about us moving towards a leisure society with automated
manufacturing, political participation and an emphasis on the quality of life, whilst the
automation of work has made a few jobs more skilled, money routine, semi-skilled and
unskilled, jobs remain, majority are found in the service sector i.e. (fast food)"
4) "Is the status of it workers, are these workers the new enlightened elite referred to by
information society theorists?"
There have been huge growths in employment in the computer and
telecommunications industries.
5) "Has the information society led to greater equality-between social classes men and
women, the industrialized and less developed world, the able-bodied and the disabled?
Or has it made the rich richer and those in powers more powerful?"
6) "Does the information society have any features which are not adequately explained by
notions of industrial capitalism? Dealing with information does not in itself confer
power."
"The information society is here, in advanced industrial societies-whether we like it or
not, or agree with it or not – in that it is undoubtedly pervasive and important in our
daily lives."
35
Question 44:
Who is Daniel Bell?
Question 45:
What are the dimensions of the Postindustrial Society?
Question 43:
What are the Criticisms of the Information Society?
CHAPTER 24:
GLOBAL INFORMATION INFRASTRUCTURE: ELIMINATING THE DISTANCE BARRIER
BY Heather E. Hudson
The global information revolution is modifying drastically the world of telecommunication.
Furthermore, the way of life, the nature of work, the methods of learning and the way people
interrelate are changing rapidly.
Other major developments resulted from "the rapid introduction of new technologies and
services, the restructuring of the telecommunications sector; and globalization of economies
and of communication":
• the narrowing of distance
• the broadening of "information superhighways"
• the expanding omnipresence of communications based on wire technologies
• the increasing contribution and competition of developing countries for data entry and
word processing and for computer programs.
I. GLOBAL NETWORKING: CHANGING THE GEOGRAPHY OF BUSINESS.
The huge progress in global networking offers great opportunities for developing new
business. The electronic security protection and improved code are encouraging
consumers and businesses to use the Internet.
The companies will sell their production and have links with employees and sub-
contractors worldwide. Any company, with valuable products and services can put its
catalog on the Internet and become rapidly successful and grow into a global position.
Businesses can exploit telecommunications to develop a competition advantage
internationally. India is a good example. High tech-companies in Silicon Valley can
employ Indian engineers and programmers "at a fraction of the cost of expanding its
professional work force in the United States". India will have an additional advantage
in keeping and retaining highly skilled professionals who might otherwise leave the
country.
36
The demand for services will expand and require access to a wider range of frequency
(bandwidth) to be used in telecommunications in order to transmit signals.
II. TOWARD GLOBAL INFORMATION INFRASTRUCTURE (GII)

"Information highways" are destined to link communities and nations. They will
necessitate the contraction of a national and international "information infrastructure" to
establish the Internet and other forms of electronic communications at the disposal of
people around the world.
The Clinton Administration, the State governments in the US and the European Economic
Committee as well as Japan, Canada and APEC (Asia Pacific Economic Conference)
began to encourage, it the 1990s, the creation of several pilot projects to launch innovative
applications. The objectives were and still are:
• to spur economic growth and job creation.
• To increase competition and productivity
• To assist the liberalization of the telecommunications industry.
• To reduce tariffs and favor competitiveness.
• To facilitate universal access in a cost-effective way.
III. GII (Global Information Infrastructure): PROMISE OR HYPE?

Information services bring both social and economic benefits. The government and
the private sector must cooperate to guarantee "the installation of national
broadband networks". The public sector will have to introduce "institutional change
and incentives to innovate in order for these technologies to have much effect".
The "Information Superhighway" applications must be considered not only in business
terms but also in its cultural and moral consequences.
A certain number of countries feel that their citizens are at a disadvantage because
they are "left behind" as other countries are progressing more rapidly in the field of
information equipment and service. They are worried that "The first countries to enter
the information era will be in a position to dictate the course of future developments to
the latecomers".
IV. PROMISES AND PARADOXES.

Modern technologies and telecommunications services are attractive, but they also
reveal demanding tasks and contradictions "for the telecommunications industry, users
and policy makers". The following examples illustrate these challenges and
paradoxes:
• the new technologies preside over new changes faster than policymakers can take action
to stimulate those innovations.
• the tendency to consolidation in the telecommunications industry bring about oligopolies
"able to offer a greater range of services than their predecessors" but with the danger that
competition will be reduced in price, service or innovation.
• some governments want every business, home and school connected thanks to the
extension of optical fiber optics. But, a certain number of governments "have retained
tight control over individual access to information".
37
V. CLOSING THE GAP
Investments in telecommunications in many developing countries are increasing
rapidly. But people access to basic telecommunications is limited.
New technologies will help to achieve great progress in making telecommunication
available to end users.
"Wireless local loops or small satellite terminals rather than stringing wire and cable"
will allow reaching a considerable number of end users.
But governments like the Chinese government limit access to information from abroad.
They block access to internet sites depriving students and researchers from searching
for new information through libraries and databases beyond their borders. The public
and the private sector are also at a disadvantage in such a case because they are
deprived from the valuable information provided by modern telecommunications
technologies.
Question 45:
Explain how is global networking changing the geography of business and make it evolve
toward global information infrastructure (GII).
Question 46:
Do you consider the global information infrastructure a promise or a hype? Explain in detail
its promises and paradoxes.
38
CHAPTER 26:
A ROAD MAP FOR NATURAL CAPITALISM
By Lovins, L. Lovins and P. Hawkin
Industries operating in the advanced capitalist states should benefit from the services
provided "for free by the earth's ecosystems-its oceans, forests, and plains"-and should learn
not exploit these resources as such.
Forests, for example, are used by industries for production of wood fiber. In so doing the
reduce the forest's capacity to make available its valuable ecosystem services such as water
storages, maintaining the equilibrium for the atmosphere, the climate and the habitat. The
estimated value of all the earth's ecosystem services is at least $33 trillion a year.
The destruction of the ecosystem services can be very costly as the flooding of the China's
Yangtse basin in 1998, resulting from deforestation, proved it.
The natural capitalism approach for protecting the environment (i.e. the biosphere) and for
enhancing profits and competitiveness consists in introducing four major changes in business
practices, all importantly interconnected:
• a dramatic increase in the productivity of the natural resources.
• A shift to biologically inspired production models.
• The move to a solutions-based business model
• The reinvestment in natural capital.
I. A FIRST IMPORTANT CHANGE IS NEEDED IN THE MANAGEMENT OF THE

ECOSYSTEM: DRAMATICALLY INCREASE THE PRODUCTIVITY OF NATURAL
RESOURCES:
I.1 Implementing whole-system design and thinking.
The objective is to design, for resource savings, by adopting whole-system thinking in
order to reduce all forms of waste.
The whole-system thinking allows to optimize the whole system by analyzing potential
improvements in its different components and their respective costs and savings. In looking
for progress and better productivity, the manager can locate small improvements that
generates big savings. A few examples in chapter 26 (pages 252-254) illustrate the concept
of whole-system design and concept such as:
• the case of Interface corporation
• electricity savings resulting from the improvements into building structure and their office,
heating, cooling and other equipment.
• The case of Dow Europe Swiss headquarters
I.2 Adopting innovative technologies

The automobile industry for instance, is due for a drastic technological change for the
following reasons:
• its infrastructure is very expensive and inefficient.
• Auto manufacturing is capital intensive and its product cycles are long: the care of the
hyper car which "will cut cycle times, capital needs, body part counts, and assembly effort
and" space by as much as tenfold.
39
With better and new design and with technological innovation, waste can be reduced
dramatically, efficiency increased and profits improved. It is established that "just the energy
thrown off as waste heat by US power stations equals the total energy use of Japan…. In
every sector, there are opportunities for reducing several important factors: a- the amount of
resources that go into a production process.
b- the steps required to run that process.
c- and the amount of pollution generated and by- products at the end. These all represent
avoidable costs and hence profits to be won"
II. A SECOND IMPOPTANT CHANGE IS NEEDED IN THE MANAGEMENT OF THE
ECOSYSTEM: REDESING PRODUCTION ACCORDING TO BIOLOGICAL MODELS
The concept of closed-loop manufacturing consists in saving huge amounts of long-
term materials and make production processes more efficient in two main ways:
1) transforming every output manufactured into a new mix of ingredients (compost)
or into" natural nutrients"
2) or transforming every output into "technical nutrients".
In other words, in order to create new products and processes that can avoid
garbage, misuse or waste, every output shout be returned to the ecosystem or
recycled for further production.
This is the theory of closed-loop manufacturing. Productivity increases
dramatically when this theory is combined, in practice, with resource efficiency
which consists in recycling output into new products after it is used. The new
product is made even stronger and thinner by using less material and costing less
to make.
II. A THIRD MANAGERAL INNOVATION IS NEEDED:THE CHANGE OF THE
BUSINESS MODEL
Industries should strive to provide customers with better and cheaper services
that cost less to manufacture or to prepare. Schindler, for example, which have been
producing elevators for decades is now shifting towards "leasing vertical transportation
services" instead of selling elevators. The objective is to save energy and maintenance
costs.
United Technologies' Carrier division prefers to lease comfort to its customers at

lower cost instead of selling air conditioners. Furthermore, the company is contributing
in making buildings more efficient, needing less air conditioning. The new idea in
manufacturing and in offering services is that "Higher profits will come from providing
better solutions rather than from sling more equipment. The shift to a business service
model will result in the economy thus reducing "the volatility in the turnover of capital
goods that lies at the heart of the business cycle".
III. A FOURTH MANAGER INNOVATION IS NEEDED: REINVEST IN NATURAL
CAPITAL
The destruction of the ecosystem bring disasters to mankind. In the year 1998, brutal
changes in the weather resulted in the displacement of 300 million people and brought
90 billion worth of damage in China, which is more destruction than was reported for
the entire decade of the 1980s. Deforestations and "inefficiency industrialization" are
the main cause of the growing intensity of natural disasters. China is now following an
aggressive Program of planting trees in order to restore equilibrium in its environment
and avoid natural disasters. "Working with nature is more productive than working
40
against it'. Many industries are shifting their "raw materials and production to biological
ones".
IV. A BROKEN COMPASS?

Why are a great number of companies still using traditional methods of production
instead of improving their profitability by adopting a sustainable approach to benefiting
from a biological resource base:
The answers in those companies are using inappropriate instruments:
• to establish their objectives
• to measure their performance
• to gratify or reward success.
The organizational structure of markets in the industrialized countries suffers from major
deficiencies such as:
• different kinds of distortions
• the inefficient system of taxation because "tax laws penalize what we want more-jobs and
income-while subsidizing what we want less of".
• Government policies and the way they are implemented
• And a great number of perverse incentives".
The results of such "forms of misdirection" are misallocation of capital and the loss of great
possibilities for profit.
Natural capitalism try to join together ecological with economic goals in order to avoid the
huge waste of natural resources and to build a new and prosperous world that benefits from a
healthy climate and form a "proactive biosphere"
Question 48:
Explain the Characteristics of the whole-system design in improving the productivity of natural
resources and illustrate by example (Electricity saving resulting from the improvements into
building structure and their office or the case of Dow Europe Swiss headquarters.).
Question 49:
Explain how the change of the business model can contribute to save energy and
maintenance costs by using the example of United Technologies Carrier division specialized
in elevators.
Question 50:
The reinvestment in natural capital helps restore equilibrium in the Environment and avoid
natural disasters. Explain and illustrate the importance of this managerial innovation.
41
CHAPTER 27:
REFLECTIONS ON THE POLITICS LINKING SCIENCE, ENVIRONMENT AND
INNOVATION
SIGN-POSTS: observing Environmentalism and Research in the "real World"

- There is no global environment, rather many environments most of which have
long ceased to be "natural".
- Environmentalism, especially in its more extremis form, is not sciences, but on
ideology largely constructed from science.
- It assumes that human activities, especially those of industrial society, are
destructive and ultimately pathological.
- Environmentalism thrives on one-world images which in turn tend to be used to
rationalize globalization processes, such as free flows of capital, expertise, and
technology.
Environmental Innovation
Environmental innovation is all around us today inventions in Environments include (power
stations, plant, solar cells, energy efficient Automobiles)
The Role of Elites and Environment

The elites (Top Government officials and Business Men) sometimes use environmentally not
friendly factories, outputs in their favor without consideration of the Environment.
The Political Utility of Mainstream Economics

The attraction of "Mainstream" economic theory, and its recommendations, and hence of
allegedly value-free and Purely-technical advice, to poitical elites, lies in the Power it
promises to bestow on those who manage to apply them effectively.
Are we in danger of creating a world in which science and Technology will protect the
"environment" of the North so that people there can be better neglected as a useless and
inflexible under class, while the application of science and technology is resisted elsewhere
with reference to the same expertise?
Toward a Conceptual Framework for Interdisciplinary Analysis of Environmentalism and its

Impacts
Elites in search of Economic miracles and Power
Elites and their professional advisiors tend to shape international politics in the context of
changing technologies which they themselves have earlier selected and financed, often with
public Money.
Commercial elites tend to use the structures and Networks of the Modern state (including
non-and inter governmental organizations) to "green wash" as justify their expansion and
justify financial globalization.
Persuasion, regulation, and subsidization are used to create markets for new Technologies.
Scientific Institutions as Political Actors

The creation of knowledge as a commodity is becoming more dependent on political actors
The limits of (natural) scientific knowledge in "measuring" a selected environmental problem
need to be understood better in order to protect environmental policy and subsequent
innovation from excusive professionalization and political manipulation.
42
Societies will have to decide through political process whether they:
1) Ignore "the environment' because they have other things to worry about
2) Strive to understand an environmental 'problem' to advance the frontiers of pure
knowledge
3) Regulate environmental consumption by Nimbism (No in my back yard producers)
and taxation policies
4) Rush into precautionary or remedial action and innovate along a broad front.
Science, Innovation, and Environment Identifying Linkages

A number of distinct roles of the 'environment' can be observed:
1) Symbolic- Preserving the political status quo by diverting public attention to future
problems, with reallocation of rezones to research but little technological innovation.
2) Stimulating technological innovation processes which strengths political/ commercial
centers at the expense of peripheries (Perimeter of circle) from the center.
3) Stimulating technological and institutional innovation to serve political centers and enhance
corporate decisions and investments.
4) Stimulating innovation to serve a 'common interest' or a 'public good' such as welfare,
employment.
Specific forces, geographical factors and historical contexts will decide a particular national
outcome. The interaction of all of these and their realizations in particular life have impacts
not only on how relatively simple criteria of assessment such as economic efficiency or
competitiveness are interpreted, but also on socio-political processes.
Research Questions for the Social Science Conclusion
The major research area must surely be to ask whether observed responses to the
threatened environmental disasters have resulted in overall innovative responses and
whether these will:
1) Create wealth at home and expert opportunities abroad, especially to the world's
peasants (poor), slum dweller and unemployed youths.
2) Initiate a new social as well as technological 'paradigm';
3) Create more fairness peoples as well as more benign, less destructive relationships
with biosphere.
The idea that elites (Rich people) use knowledge to serve their own pre-existing ends
applies to states as well as corporations and non-governmental organizations. It raises
questions which only case studies can hope to answer.
4) How each has used and sponsored science in relation to environmental protection.
5) Whether, how and why the 'environment', or the goal of sustainability have stimulated
innovation in a specific society;
6) How environmental protection and innovation relate to the more fundamental functions
of governance.
7) Environmental institutional innovation (conceptual, legal, administrative, organizational,
educational).
8) Assessment of socio-political impacts of seeking green competitiveness, especially in
technologically weak courtiers.
9) The role of scientific institutions in directing research policy and R&D spending.
43
Conclusion
The broader political and cultural impacts of green policies need analysis democratic political
institutions must remain empowered to make and enforce environmental decisions, and the
social sciences might be hand maids of such institutions.
Question 51:
What are the impact of existing environmental policies and measures on the distribution of
decision-making power, work, welfare, and income distribution, as well as conflict potential in
any society or the European Union?
Question 52:
How is the society environment dichotomy dealt with in the conceptual thought of a society?
Question 51:
How observed difference by can explained, and what is their impact on supra-national policy
information?
QUESTION 28:
Explain how the power distance dimension influences the culture, the attitude and the
way management, exercises power.
Explain how the uncertainty avoidance dimension i.e. the tolerance to accept a certain degree
of risk determines attitudes towards work, career, and with respect to rules in the developing
countries and in the developed countries.
QUESTION 29:
Explain how the individualism-collectivism dimension and the masculinity-feminity dimension
differentiate between cultures.
thoroughly please refer to pages 151-158 of chapter 15 from B200 Reader 1: Environments
Bandar18. AOU. Riyadh
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Chapter 1 - Globalisation

So, the right ideas go for whom?

- The right ideas go for radical

Globalisation can be defined as Americanisation or westernisation; countries such as Los

The opposite word to Globalisation is Colonisation.

Colonisation: non – western countries that influence development.

Chapter 2 – Identifying Environmental Issues

- STEP Checklist – Study Adv/Dis

See the Module (Block) – Page 13

See the Book Environment Page 11-15

The Policies, the Goals, and the Successes

Understanding Business: Environments.

ECONOMIC POLICIES AND INSTITUTIONAL TRANSFORMATION

Economic decline is closely related to the institutional framework of a country, to the

COMPANY AUTONOMY AS AN INSTITUTION

CHAPTER 5 - FINANCE UNBOUND

Chapter 6 - Building a Model of the Economy

Economy could be seen as a series between two keys:

Banks and other financial institutions come into the act.

The four Government policy objectives are as follow:

The Management of Demand

In Condition of Mass Unemployment there is a Need to increase the Aggregate Demand,

See Page 59 Environment Reader

Export, Consumer Demand, Investment Goods and Government Spending

See Diagram 6.7 Pages 60 + Class Explanation

Multiplier effect See Page 60 + Class Explanation

Difficulty Number One

1) Limited Competitiveness/ See Diagram 6.8 Page 63/ Explanation.

The strength of the economy is affected by other factors such as:

Quality of Education, management, Social Piece and Efficiency.

Monetarism thought the followings:

 Expansion that happened in technology and communication.

The Players Affecting the Financial Market Players

1- Savers, they save money for retirement – maximum risk-

The Forces at Work Today

Implications of a Borderless World

See Reader on Page 78

See Reader on Page 79

See Chapter 8 from page 76 – 80

1. GLOBALIZATION VERSUS REGIONALISATION:

1.1. The Central Planning Bureau (CPB) scenarios.

b. The “Regional Rivalry” scenario will develop protectionist behaviour and

c. “Benign regionalism” scenario or “defensive protectionism concludes that

The Interdepence via the International Financial Markets scenario.

• The "Interdependence via the International Ecological System” scenario takes

I.3 The “AMSTERDAM” scenarios.

a. “Managed Multilateralism” that allows the introduction of new technologies,

II. INTRA-BLOC DEVELPMENTS (within the three blocs) AS A DETERMINANT OF

Developments in North America.

III. SOCIAL DIVISIONS

CHAPTER 12: CHANGING SOCIAL DIVISIONS:

CLASS, GENDER AND RACE.

I. CLASS AND CHANGE.

I.1 Marxist and Weberian Approaches.

I.3 The Working class.

I.4. The Middle classes:

GENDER AND CHANGE

II.1. Theorizing Gender

II.2. Gender divisions at work

II. RACE AND CHANGE

III.1 Theorizing race.

III.2. The changing pattern of racial inequality.

1) The relocation of production by MNCs is limited and constitutes a small percentage of