The Paradox Of The Thrift Economics Essay

The Paradox Of The Thrift Economics Essay The theory of paradox of thrift is the idea that saving instead of spending can cause or deepen a recession. According to John Maynard Keynes, consumer spending is beneficial because one persons expenditure is another persons income. Therefore, an increase in savings would mean that businesses lose out on revenue and have to lay off employees who are then unable to save. As a result, increase in individual savings would reduce the total saving rate. On the other hand, some economists argue that, savings can be beneficial to an economy. If the society decides to save in a bank, the banks would loan that money to firms and who in return will invest into capital, producing a positive multiplier effect. It just depends which phase of the economic cycle the economy is operating. During low demand market conditions like at the moment, saving is beneficial for the one who saves, but of little use to the overall economy, this is known as the fallacy of compositions. C:UsersPawanjeetDownloads20121208_165525.jpg In the Paradox of Thrift, household and producers reduce their expenditure in anticipation of a future recession. It is referred as paradox because its behavior which seems beneficial is actually detrimental to the economy. Its beneficial for the individual who decides to save, but the society as a whole experiences economics problems. Assume there was an exogenous increase in planned savings due to future expectations of the UK economy. This means that the autonomous savings will increase; hence the saving function will have parallel shift upwards. A rise in the thriftiness will lead to a reduction in national income (Y1 to Y2), consequently savings will decrease from B to A. Furthermore, due to the shift, S>I which implies that Y>AD, therefore there will excess supply of goods. The result will be paradoxical because an increase in saving will eventually translate reduction in national income.C:UsersPawanjeetDropboxPhotos20121209_172334.jpg The lower consumption will discourage firms from investing, if investment falls, the J line will shift downwards. There will be further multiplied fall in national income. Due to the negative speculation of the economy, lets assume that the marginal propensity to withdraw is now 0.75 and marginal propensity to consumption (domestic goods) is also 0.25. Consider that the initial investment falls from 100 to 50 (million) in the economy. Therefore, as firms reduce investment, workers will be made redundant. These workers will have no spending money, therefore causing other business to experience a decline in customers. When wages will be received, 0.75 would be withdrawn and only 0.25 will be spent on domestic goods. The reduction in consumption would generate further losses for firms, generating 12.5 million incomes for firms from the initial 50 million. When this is received by households in term wages, 0.75 will be withdrawn and 0.25 will be spent. There will be further decrease in n ational income by a further 3.125 million. Therefore each time we go round, national income will decrease due to the multiplier. As a result, the economy will contract and firms will experience hefty losses in revenue, resulting in several closure. According, to the consumption function, as income decreases so do savings, therefore more savings will lead to ultimately and paradoxically less savings.C:UsersPawanjeetDropboxPhotos20121208_182123.jpg C:UsersPawanjeetDropboxPhotos20121208_201542.jpg The theory behind the paradox of thrift has been widely criticised. Firstly, its a theory and subjective, therefore its not a stated fact. Secondly, given the example above, the paradoxical result may not occur if an increase in savings will lead to simultaneous increase in planned investment. Consequently, both the investment and the saving function will shift upwards; therefore national income will not be affected. Furthermore, when the multiplier becomes smaller due to higher marginal propensity to save, the IS Curve will shift from IS to IS1. This will influence aggregate demand to shift leftwards; hence there will be a reduction in prices. As price decrease, this will shift the LM curve to the right, forming a new equilibrium. Consequently, we will have lower interest rates and prices. Therefore, when interest rates fall this will influence firms to invest and when prices decrease this will trigger a rise in demand again, so the theory of the paradox of thrift is contradictory. Economist argues that saving can translate to investment, therefore in a recession, saving can be beneficial. Savings will allow these investments to be financed without problem of interest rates or inflation. Suppose an individual decides to save  £10,000 in a saving account. Consequently, the bank would lend money to a firm who would spend it to expand or to the government by purchasing treasuries. When the fund is given to firm, they will invest into capital that would boost total output. Therefore, theoretically, an increase in savings will allow a higher growth in potential GDP, especially if the investment is in new technologies. During 1950s, Americans put away more than 9% of their income. Their savings translated into stocks and bonds and formed a pool of capital investment. They experienced a golden era of productivity and growth, leading towards the 1990s boom. Although this changed, in the mid-1980s, this is because credit become easily accessible, therefore people were not saving for future consumption, because they could use to borrowing. By the late 2000s, the savings rate plunged to less than 1%. * Theoretically, using the GDP equation (closed economy) we derive that saving=investment Y=C+I+G (1) I=Y-C-G (Rearrange to make I the subject) S (private) = amount produced (Y) +transfer payment from the government (TR) consumption (C) Taxes (T) S (public) = T-G-TR Total saving in the economy will be s (public) +s (private) = T-G-TR+Y+TR-C-T=S Therefore, total saving in the economy =Y-G-C Sub into equation (1) S=C+I+G-G-C Therefore, S=I This shows that the total amount of savings in the economy is equal to investment Source: Gfk nop 2012 In the Wall Street Journal, the writer states savings would translate into more investment and faster growth. This view has been supported in the work by Fazzari (2007). On the contrary, what will happen if the firm does not invest into capital? What will happen when banks do not give loans to firms? The statement that saving=investment is contradictory. It does not necessarily mean that every pound saved will be invested. Investment does not only depend on household savings; it could be animal spirit, business confidence, aggregate demand and cooperation tax that could influence investment. Therefore its only an assumption and not a stated fact. Furthermore, higher savings would mean there would be less consumer expenditure, therefore aggregate demand for goods and services would weaken, hence investment into capital goods could occur only in the long run. Moreover, during low market demand conditions like the current one, firms may not want to invest, if there is not demand for cre dit, the banks have no place to lend the money. In the UK economy, consumer confidence decreased to -31 in March and its to further reduce to due to planned austerity. Therefore investments are unlikely, regardless of any increase in savings. Furthermore, during boom in the economy cycle, where inflation is inevitable, increased savings can help. C:UsersPawanjeetDropboxPhotos20121212_140639.jpg Consider an overheated economy; where there is little spare capacity in the economy, therefore an increase in aggregate demand will lead to subsequently only to an increase in prices. The government will try to depress aggregate demand and economic activity. In other words, the government will try to encourage savings to hamper consumption in the short run. Consequently, this will lead aggregate demand to have a parallel shifts inwards, reducing prices levels from p1 to p2. Reduced inflation provides certainty towards consumers and businesses, who will be able to make long term plans due to certainty that there would less chance of their money losing its purchasing power. On the contrary, there will be a cost of reducing inflation as it will impact upon low income earners, decline in economic growth and will result in higher unemployment. As shown from the macro perspective, an increase in saving for the economy as a whole may lower aggregate demand and initially reduces output, income and probably investment. So would savings be ever desirable? Yes, during an overheated economy, increases in savings can help reduce consumption, which would therefore reduce prices levels. Furthermore, as some argue, increases in savings may likely to influence investment levels. It just depends which phase of the economic cycle the economy is operating. During low demand market conditions like at the moment, saving are beneficial for the one who saves, but of little use to the overall economy.

Computer Class

You are writing a research paper for your history class and have found a photo on the Web that you would like to use. You are cautious about using photos on the Web because of copyright Issues and photos that have been altered digitally. How might you verify the validity of a photo on the Web? When using a source for a research paper It Is always very Important to verify the book, website, photo, etc.In order to verify the validity of a photo on the Web, people need to check the source as to wear It came from, If the website Is not a website with absentia validation, then the photo Is not a resource that they should use In their paper. Also there Is now a Google â€Å"Search by Images† page. This allows people to copy and paste the picture Into the search engine and see where It came from. If the sources that come up do not have accurate validation of the photo then It Is not an appropriate resource that person should be using for his or her paper. Work Password Management: Yo u must remember multiple user names and passwords to access various computer resources within your company. Each time your company introduces a new system, you must remember a new user name and password, some of which you are unable to customize. What steps will you take to manage your passwords? When managing passwords and user names that you were given by your company always make sure to write it down on a certain piece of paper and put it in a safe place.Nowadays there are so many things that you need to have a user name and password for. Work is one of the main things. When introducing a new system, and receiving a new user name and password create a paper that ash the rest of your swords and user names on there with a brief description of what the website is about. This will allow you to remember the website, but also have your user name and password handy.One more thing is that when creating this paper you must find a safe place to put it so that no one can use the paper to lo gin to your account. Make sure you know where the paper is and do not tell anyone because if they find out where the paper is, other workers can have the potential to mess up or change your career. Computer Class By ambassadors using photos on the Web because of copyright issues and photos that have been When using a source for a research paper it is always very important to verify the book, website, photo, etc. N order to verify the validity of a photo on the Web, people need to check the source as to wear it came from, if the website is not a website with substantial validation, then the photo is not a resource that they should use in their paper. Also there is now a Google â€Å"Search by Images† page.

Disaster Prevention, Incident Response, and Relocation

Recently, there have been a lot of efforts being made by organizations and government agencies that focus on disaster prevention and mitigation. Disaster, as defined by the Federal Emergency Management Agency (2007), â€Å"takes many forms — a hurricane, an earthquake, a tornado, a flood, a fire or a hazardous spill, an act of nature or an act of terrorism. † The advent of efforts that generally apply to environmental and natural disasters, as well as man-controlled disasters, has stirred many of us.In this light, this paper will also give an overview at the way disaster prevention, disaster incident response, and disaster relocation are being handled in the society, particularly in the technological aspect of the sourcing process. First, the concept of disaster prevention could be considered as a basic part of any research source since the idea of disaster preparedness had not been so new a concept.In this regard, a website made by an Ethiopian agency embarks on disast er prevention and preparedness. The site has the title Disaster Prevention and Preparedness Agency (DPPA), and it functions as a governmental commission that acts as an information board relegating to several important data for its audiences. Its main focus is on the humanitarian situation in Ethiopia.The sections in the homepage provide the categories of information and these include: the news section where news clips of related humanitarian activities are linked; public relations section wherein publications made by the DPPA are shown; livelihoods section presenting regional livelihood analyses; pledges and deliveries section which shows the status of responses to humanitarian appeal; and other categories that generally determine related information. The website serves as a database that does not merely show the programs of the DPPA but also the activities which characterize its endeavors.How disaster prevention is illustrated in the website is transcended more with the commission ’s activities rather than the information that individuals should look into in going in-depth at disaster prevention. The program lay out mentioned disaster prevention as looking into the root causes first in order to anticipate actions, in which the mechanism of Employment Generation Scheme was applied (DPPA, 2009); however, the mechanism seems to be a needs-based approach – giving relief (food) in exchange to the victims’ physical work. This somehow connotes unsustainability.Personally, I see the website as a mask for a marketing method to gain assistance from aid organizations. Second, carrying the concept of incident response is the website of the Federal Emergency Management Agency (FEMA). Mainly acting as a response unit, FEMA has several coordinating subgroups which specialize according to the varying forms of disasters. Among these coordinating groups are Emergency Response Teams, Federal Incident Response Support Teams, Hurricane Liaison Team, Urban Sea rch and Rescue Task Forces, Mobile Emergency Response Support, and many other categorizations.In the website, there is also a major part that includes the mechanism where incident response is applied. This mechanism is called modeling, and is considered as â€Å"essential element of [†¦] planning efforts [†¦] for different circumstances and data sets† (FEMA, 2007). Further, the website includes the specific actions that it does as a response unit. Some of these undertakings are centered on the development of mission assignments, and coordination with other concerned agencies.This website is indeed informational, although it could somehow appear to give out an information overload, but nevertheless, it serves its function in imparting knowledge about an agency’s incident response to disaster. The third website is a link on disaster relocation which is shown by the Laguna Beach City in California. It shows a government plan that aims to establish relocation whe n a disaster that requires an immediate evacuation occurs.Very simplistic does the plan seem, such that it states that â€Å"every family [must] designate an out-of-state contact to help coordinate family reunion plans† (City of Laguna Beach, 2006) when a major disaster strikes. The website visually looks like an advertisement for vacation places, but over-all, its content is simplistically relevant. To summarize, the three websites are shown in a much differentiated manner. The contents are highly regarded as informational, although the focus of the contents of each site does not necessarily revolve in the topic headings that they have.The website for FEMA is probably the most informational among the three since it gives a comprehensive lay down of the activities and the coordinating groups that are needed in its functioning. Disaster and its adverse effects could be mitigated by individual preparedness. The starting point in disaster preparedness is to â€Å"help your comm unity by [first] preparing yourself† (Canadian Red Cross, 2009). Meanwhile, web sources are commonly relied upon in times of disasters, so it is important that these sources are able to provide comprehensive information that would help people in facing such risky situations.

A Cognitive Delay Like Autism Spectrum Disorder - 1951 Words

A cognitive delay like autism spectrum disorder is a disorder that involves persistent deficiency in social communication and social interaction in multiple context. Some pervasive developmental delay that people with autism can be deficient in are problem with intelligence, perception, socializing skills, language and emotions. Children that are diagnosed at an early age and receive the adequate therapy intervention if it either behavioral or cognitive, can progress more and can start to develop the skill that delay their development. In the DSM-5 it says how autism exists on a spectrum going from severity based on social communication impairment to restriction to high functioning children with normal intelligence in exceptional areas, but that has some social struggles. People on the autism spectrum can sometimes be highly sensitive to light, sound and smell, and might become very uncomfortable and pressured. Autism has increased since the year 2006 were 1 in 68 children are diagnosed with autism every year, autism is much higher in boys than girls. People have started to be more aware of autism and its symptoms to get children’s diagnosed at an early age. Young adult that may suffer from a severe autism may not become fully independent from their parent or family, they might have to be dependent for their entire life, depending on the severity of their cognitive delay. It is always better for a child with autism to get diagnosed at anShow MoreRelatedInformative Speech : Autism Spectrum Disorder Essay873 Words   |  4 PagesSpeech: Autism Spectrum Disorder Attention Getter: Some of us parents take it for granted when our kids talk so much, ask so many questions, or clown around all day long. We tend to forget how there are some parents that don’t get that right away. Topic Disclosure: Today I am going to talk to you about autism spectrum disorder. Preview: During my speech I will discuss: I. Causes of autism II. Symptoms III. Treatments Audience Link: Before doing the research on autism spectrum disorder I thoughtRead MoreLanguage Delays And Autism Spectrum Disorder1632 Words   |  7 Pages Language Delays in Autism Spectrum Disorder Bethany Perez Colorado State University Autism spectrum disorder is caused by abnormalities in the brain. Many children that qualify under the autism spectrum disorder, often experience developmental delays in three areas of development. Socially/emotionally, as well as cognitively, children with ASD are unable to progress at a normal rate of development compared to their peers. The level of communication due to language delays can be severelyRead MoreThe Diversity Of Children With Autism Spectrum Disorder1243 Words   |  5 Pagesof people with mental disorders but there had always been that barrier that prevented me from approaching and getting to know them better until I met my best friend’s brother in high school. It was as if a new door opened up to my sense of identity and self-awareness in this world. Fortunately, as years passed by, my best friend’s brother and I grew close. I realized that autistic people were people just like us who needed to be cared for and loved compassionately just like eve ry human being. ThisRead MoreDifferentiating the Diagnosis Between Autism and Aspergers Disorders1113 Words   |  5 PagesTwenty years ago, we seldom heard of the terms Autism or Aspergers Syndrome. Today the terminology seems to be as well known as the words Schizophrenia or Down Syndrome . Most of us know someone who has a relative with one of these disorders, or have a child or a relative ourselves who has been diagnosed. While the terms are recognizable, these disorders are relatively new to the ordinary citizen. The knowledge of the cause, symptoms, diagnosis, and treatment are even further limited. For thoseRead MoreWilliams Syndrome As A Neurodevelopmental Disorder Essay892 Words   |  4 Pagesneurodevelopmental disorder, caused by a contiguous gene deletion of about 26 genes from the long arm of chromosome 7(Peoples et al., 2000). Since it had been first aware by J.C.P. Williams in 1961(Lenhoff, Wang, Greenberg Bellugi, 1997), Williams Syndrome has drawn more attent ion in last 40 years. the incidence rate is approximately 1 in 2000 and diagnosed generally at 6.4 years old (Morris, Demsey, Leonard, Dilts Blackburn, 1988). People with WS usually show a developmental delay at the early ageRead MoreImpact of Setting and Instructional Context for Adolescents with Autism892 Words   |  4 Pagesstrategies are essential in promoting a healthy learning environment; however, there are challenges with every instructor because every student have their own way of learning, especially with mainstreaming students with special needs. Since laws were passed like The Individuals with Disabilities Education Act (IDEA) and The No Child Left Behind Act of 2001 (NCLB), there has been a standard of learning that each student have to master in order to graduate high school. Students with special needs are no longerRead MoreAutism Spectrum Disorder And Autism Essay1393 Words   |  6 PagesAutism is a neurological disorder with many forms and severities, better kn own as autism spectrum disorder, that begins early in childhood and lasts throughout the individual’s life. Autism spectrum disorder is defined as developmental disabilities that can cause significant social, communication, and behavioral challenges (CDC). Previously, autism was recognized in distinct groups and types. Now, autism is referred to as a spectrum because there is an overlap among all the different forms of autismRead MoreAutism Spectrum Disorder : Autism, Asperger Syndrome, And Atypical Autism1499 Words   |  6 PagesAutism spectrum disorder is a spectrum of psychological conditions which all consist of problems pertaining to social interactions, communication, and highly repetitive behavior. There are three main forms of Autism spectrum disorder: Autism, Asperger syndrome, and Atypical Autism. Autism is a developmental disability which results from a neurological disorder that affects the normal functioning of the brain (Lord, Cook, Leventhal, Amaral, 2013). It first appears during the stages of infancy toRead More Autism Spectrum Disorder and Interventions1042 Words   |  5 Pages Autism spectrum disorder (ASD) is a neurodevelopmental condition that develops during a child’s first few years of life (Lesack, Bearss, Celano, Sharp, 2014). This disorder occurs significantly more often in boys than girls (Goldstein, Naglieri, Rzepa, Williams, 2012). Autism is part of a group that is known as pervasive developmental disorders (PDD), which also includes Asperger’s disorder, Rett disorder, childhood disintegrative disorder and pervasive development disorder not otherwiseRead MoreAutism Spectrum Disorder ( Asd )909 Words   |  4 PagesAutism spectrum disorder (ASD) refers to a group of neurodevelopmental disorders that is characterized by abnormalities relating to social, behavioral, cognitive and language skills. The genetic architecture of ASD is comprised of a variety of rare mutations. These mutations include mo nogenic conditions involving autistic symptoms. Furthermore, single nucleotide variants and de novo copy number variants add to disease susceptibility. Inherited Factors Related to ASDs Autosomal recessive loci are