Philippine Development Plan Market Power- ability of a single/group entity
3 Pillars: can influence the market price of a product
- Malasakit- enhancing social fabric Pure competition- No singular entity can -Pagbabago- Inequality reducing dictate market price. transformation II. Development Economics - Patuloy na Pag-unlad- Increasing growth GDP (Gross Domestic Product)- value of potential total goods and services produced in a single Goals: year - Matatag GNP (Gross National Product)- GDP + - Maginhawa abroad remittance) - Panatag na Buhay Per Capita Income- GNP/ Population I. Introduction 2.4 New Approaches 1.1 Economics and Scarcity Human Development Index Resources- basis for making products - Per Capita Income - Natural Resources - Life Expectancy at Brith - Capital Good Resources - Educational Attainment - Human Resources Green GNP- GNP taking into account Production Possibilities- maximum amounts depletion of natural resources. of two different goods that can be produced 2.5 Comparisons between countries during a particular time period Exchange Rate Method- exchange rate Effiicency- Maximum use of resources. between local currency and USD No Unemploylment, no Idility. Proper PPP (Purchasing Powe Parity)- number of allocation of resources. units of a country’s currency is required to buy Equity (1.3)- Fair distribution of the same amount of goods and services a USD resources would value at. Opportunity Cost- the best alternative that is III. Growth and the Asian Experience forgone to produce something else. 3.2.1 Components of Input and Output Unemployment Y = f(K, L) Economic Growth- quality/quantity of Y= output income resources increases (Outward Shift) K= Capital Services L= Labor Goods 3.2.2 Total Factor Productivity - consumer goods g(Y)= g(K)W(K) +g(L)W(L) - capital goods g(Y)= growth rate ofincome -private goods g(K)=GR capital/investment - public goods g(L)= GR labor 1.2 Economics and Distribution W(K)/(L)= weighted shares Law of Demand- Price and Qtty. demand are 3.2.4 Technical Progress inversely proportional, Cetaris Paribus. Embodied TP- changing nature of inputs into Law of Supply- Price and Qtty. demand are production process directly proportional, Cetaris Paribus. Disembodied TP- refers to to how factors are Equilibrium- Demand=Supply combined. Shortage- Demand>Supply 3.3 Growth Theories Supply- Demand<Supply Keynesian Growth/Harrod-Domar 1.4 Market Failures g(Y)= Savings ratio/Capital output Ratio Spillover- costs/benefits affect people not directly involved in the production/ consumption of a product Started in June-September 1997 Solow/Neo-classical Model- incorporates law Bubble Economy- surge in activity resulting in of diminishing returns over inflated prices that are not sustainable. Non Performing Loans- economy overheats in 1995-1996. Risky and unsupervised loaning Moral Hazard- a gents take more risk with being insured of negative consequences. External Difficulties Overvalued Exchange Rates Collapse in Exports from 1995-1996 Contagion, Globalization, Financial Integration Slowdown growth in europe and USD Power Balance Theory- poor countries export strengthened. raw materials to industrial countries in exchange - Investors withdrew without discrimination. for industrial goods. Asserts that poor countries - Other countries were forced to take competitive need to export more raw materials to avoid devaluation to keep pace with thailand’s regression as a result of deteriorating value of devaluation. trade terms. 4.3 Post-Crisis Experience - saving rate not is not independent to income World output growth fell ay 1998, growth was due to poverty. negative in the 5 crisis countries: Indonesia, Structuralist Approach- shifts resources Korea, Malaysia, Philippines, Thailand among sectors. Stresses rigidities that hinder 2002-2007 recovered. shifting. (Agriculture, Industry, Services) New Growth Theory- includes technology and Overall, the downturn wasn’t caused by a fall of higher levels of education. export but a mass withdrawal of funds, a collapse in exchange rates, and bankruptcies. Social Impact - made banks reluctant to lend - reverse migration- urban residents moved back to the province. - Mental health problems. 3.4 Asian Growth Miracle - High school dropout rates 1.Outward looking Policies, Emphasis on exports and Foreign direct investments
2.Macroeconomic Policies and Role of
Government
3. Education, Labor Force Growth, Labor
Productivity
4. Labor Market Flexibility
IV. Asian Crisis
Hedging- buying foreign stocks done to protect business from sudden fluctuations in exchange rate.
Leges Et Ivra P. R. Restitvit. A New Aureus of Octavian and The Settlement of 28-27 BC - J.W. Rich and J.H. C. Williams (The Numismatic Chronicle, Vol. 159, 1999) PDF