Purpose Of Assignment: Students Examine The Long-Run Determi

Purpose Of Assignmentstudents Examine The Long Run Determinants Of Bot

Students examine the long-run determinants of both the level and the growth rate of real GDP per person and the factors that determine the productivity of workers and what governments might do to improve the productivity of their citizens. Students will learn how saving and investment are coordinated by the loanable funds market and will see the effects of taxes and government deficits on saving, investment, the accumulation of capital, and ultimately, the growth rate of output. Students will be introduced to tools that people use when they participate in financial markets. Students will see how people compare different sums of money at different points in time, how they manage risk, and how these concepts combine to help determine the value of a financial asset, such as a share of stock.

Students will be introduced to the labor market and how economists measure the performance of the labor market using unemployment statistics. Students will address a number of sources of unemployment and some policies that the government might use to lower certain types of unemployment.

Assignment Steps Resources: National Bureau of Economic Research Scenario: The organization's strategic plan calls for an aggressive growth plan, requiring investment in facilities and equipment, growth in productivity, and labor over the next five years. It is your team's task to determine where, outside the United States, your organization should locate its new manufacturing plant. Write a 2,000-word report recommending an off-shore country and support your choice with the following data: The factors determining the country's productivity How the country's policies influence its productivity growth How the country's financial system is related to key macroeconomic variables How your organization can reduce the risk they would face in relocating The current and projected unemployment over the next five years We picked Philippines as a off shore country Cite a minimum of three peer-reviewed sources not including your textbook. Format the assignment consistent with APA guidelines.

Paper For Above instruction

The decision to establish a manufacturing plant offshore requires a comprehensive analysis of several economic factors that influence productivity, stability, and growth prospects of the prospective country. The Philippines has been identified as a promising location for this purpose, given its dynamic economic environment, strategic geographic position, and ongoing policy reforms aimed at enhancing economic stability and growth.

Factors Determining the Philippines’ Productivity

Productivity in the Philippines is driven by both internal and external factors. Internally, the country benefits from a young and expanding workforce, which can contribute to higher labor productivity if adequately trained and equipped (World Bank, 2022). Additionally, investments in infrastructure and technology, along with improvements in education and skills development, have been pivotal in boosting productivity levels. Externally, participation in global value chains and foreign direct investment (FDI) inflows stimulate productivity by exposing local firms to new technologies, practices, and markets. The Philippines’ participation in sectors such as electronics manufacturing and services, particularly business process outsourcing (BPO), exemplifies how technology adoption and workforce skills are essential determinants of productivity (Asian Development Bank, 2021).

Influence of Policies on Productivity Growth

The Philippine government has implemented numerous policies aimed at fostering economic growth and productivity. These include the 'Build, Build, Build' infrastructure program, which aims to improve connectivity and logistics, thereby reducing operational costs and increasing efficiency (Department of Trade and Industry, 2020). Furthermore, reforms in education, labor laws, and tax policies intend to attract FDI and improve workforce skills. Recent policies supporting ease of doing business, land reform, and technological innovation are pivotal in sustaining productivity growth. However, challenges remain, such as bureaucratic delays and regulatory uncertainties that can hinder the full realization of these policy benefits (OECD, 2022).

The Philippines’ Financial System and Macroeconomic Variables

The robustness of the Philippines’ financial system plays a critical role in facilitating economic activity and growth. The country has a well-developed banking sector, with a stable inflation rate and manageable fiscal deficits, which foster an environment of stability conducive to investment. The central bank’s prudent monetary policies have maintained inflation within target ranges, supporting consumer and business confidence (International Monetary Fund, 2023). The financial system’s depth allows for efficient capital allocation, supporting investments in infrastructure and technology that are essential for productivity enhancement.

Reducing Risks in Relocation

Risks associated with relocating to the Philippines include currency fluctuations, political instability, and regulatory uncertainties. To mitigate these risks, organizations should consider employing currency hedging strategies to protect against exchange rate volatility. Establishing local partnerships and engaging with government agencies can help navigate bureaucratic processes and regulatory requirements. Conducting comprehensive risk assessments and leveraging local expertise will further reduce operational uncertainties and facilitate a smoother transition.

Current and Projected Unemployment

The Philippines has experienced relatively low unemployment rates, averaging around 5.2% in recent years, although the COVID-19 pandemic caused fluctuations and setbacks in employment figures. Projections suggest that, with ongoing economic reforms and infrastructure development, unemployment could gradually decline to around 4.5% over the next five years (Philippine Statistics Authority, 2023). The growth in sectors such as manufacturing and services is expected to create more employment opportunities, aligning with the country’s strategic economic plans.

Conclusion

Based on the comprehensive analysis of productivity factors, policy environment, financial stability, and employment prospects, the Philippines emerges as a viable offshore location for establishing a new manufacturing plant. Its focus on infrastructural development, skilled labor force, and improving macroeconomic stability underpin its potential for sustained growth and productivity enhancement. Strategic risk mitigation measures, along with continuous policy reforms, will be crucial in capitalizing on these advantages and ensuring long-term success of the investment.

References

• Asian Development Bank. (2021). Philippines: Enhancing productivity through technology and skills. ADB Publications.
• Department of Trade and Industry. (2020). Philippines Infrastructure Development Plan. Government of the Philippines.
• International Monetary Fund. (2023). Philippines: Staff Report for the 2023 Article IV Consultation. IMF Publications.
• OECD. (2022). Investment Policy Review of the Philippines. OECD Publishing.
• Philippine Statistics Authority. (2023). Labor Force Survey. PSA Reports.
• World Bank. (2022). Philippines Economic Update. World Bank Publications.