EconomicsSupply Chain Market conditions in Azerbaijan and how it Research Proposal

EconomicsSupply Chain Market conditions in Azerbaijan and how it affects ability to get and pay labor - Research Proposal Example (Maharramov, 2003). Recently, Azerbaijan has witnessed solid economic growth over the last 5 years. This growth has been driven by domestic demand including non-oil private investments, public investments, government expenditures, consumption expenditures or households and oil exports. Real GDP has also witnessed tremendous growth owing to growth in the non-tradables sectors including transportation, construction, and public utilities. The capacity constraints however did not enable the supply to grow as rapidly as demand leading to inflationary pressures. The objective of this paper is to provide a discussion of the labour cost drivers, labour demand drivers, and labour supply drivers in Azerbaijan. According to macroeconomic theory the wage rate usually depends on the price level. The higher the price level the higher will be the real wage rate demanded by workers. Azerbaijan is currently suffering from high rates of unemployment. As a result the wage rates are very low. According to the Human Development and Central Unit (HDCU) and European and Central Asia Region (ECAR) (2005) a vast majority of people in the city of Mingachevir an Industrial city have become redundant as a result of lack of demand for products, which has culminated in production stoppage, bankruptcy, liquidation and corporate restructurings. This has driven the wage rates to very low levels. Based on this one can say that a major determinant of labour cost on Azerbaijan is the demand. The demand for labour in Azerbaijan is currently very low and as such people are willing to supply labour at very low wage rates. The survey by the ECAR and HDCU (2005) suggests that only 3% of the unemployed left their job vo luntarily. While some workers are not being paid at all, there is also a high degree of wage arrears.s In 2001 exports accounted for 44% of GDP in Azerbaijan with hydrocarbon products being the dominant export activities, contributing to 91.5% of total exports in 2001. The remaining share of exports consists of raw and processed food products, mechanical equipment and chemical product. (Navaretti, 2003). The largest share of imports is made of machinery for the oil industry, food products, other mechanical equipment and luxury consumer goods for the high-income part of the population. Many of the country's traditional products in the domestic market have been replaced by imports because they are unable to withstand the competition of import products. (Navaretti, 2003). Figure 1 below shows that the real wages have taken a downward trend since 2005 to record low levels over the period 2001 to 2006. The figure also indicates that the non-oil sector is lagging behind. Since imports have become higher than exports, it is likely that the country is witnessing slow growth in aggregate demand, which in turn leads to a slow down in the growth in real GDP. This in turn creates a recessionary gap, high unemployment rate and therefore low wage rates. (CFA, 2008). From the foregoing one can therefore rightly say that the wage rate in Azerbaijan depends on the growth in Aggregate demand which has a multiplier effect on the price level, real GDP growth, and therefore wage rates. Figure 1 3. Labour Demand Drivers in Azerbaijan Macroeconomic theory posits that the demand for labour depends on three factors. These include the price of the firm's output, other factors and technology. The higher the price of the

Comparative politics research project Essay Example | Topics and Well Written Essays - 3750 words

Comparative politics research project - Essay Example In the last twenty seven years Brazil has made itself well known for its participatory institutions. The Brazilian economy has been going through a phase of boom and a big section of the population has moved above the poverty level and entered the middle class. Towards the beginning of this paper I shall discuss the economic situation in Brazil in the early years of the twentieth century when there was military regime. The process of urbanization had started to take place in the final years of the military authoritarian rule. The condition of the poorest section of the population was grave since they were suppressed and neglected. In the later part of the paper I shall elaborate on the living conditions of the poor, which has improved gradually since the democratization. But before moving into the discussion of the main issues presented in this paper, I shall briefly discuss a few terms, the understanding of which is important for the reading of this paper. This paper deals with the process of democratic transition in Brazil and addresses the question whether the incidence of reduction of poverty in Brazil is directly correlated with democratization in the country. Literature review Numerous researches have been conducted about the economic situation of Brazil and its democracy and it is evident that there is an economic link but none has specifically given conclusive evidence of the democracy link to poverty and its correlation. According to a report by the Network of Democracy Research Institutes (NDRI, 2006), Brazil is one of the Latin American countries that has fought poverty after its democratization and hence indicating a link between poverty and democratization. The same link is supported by Fukuyama, Diamond and Plattner (2012) who discuss the relationship in detail and sheds more light into there being a relationship between the two in Brazil. According to a paper by Avritzer, with the onset of democracy the poor could take part in the decision making mechanism of the country which improved the representation of their interests in the policies set. It helped them to have greater access of the public goods leading to better living conditions of the poor. Research Question The Democratization of Brazil took place between the years of 1985 and 1988. In 1988, the transition was finalized by enacting â€Å"a new democratic constitution.†2 The Constitution framed in 1988 paved the way for certain important changes in regard to civilians’ access to social services as well as creating participatory institutions. In 2012, approximately twenty eight million people could be lifted out of severe poverty and the middle class has expanded with some thirty six million people joining the middle class3. The research question is â€Å"Is the democracy in Brazil the cause of poverty reduction?† . This paper would also deal with the other question that re-states the research question, i.e, â€Å"Is there a correlation between democracy and poverty in Brazil?† Terms involved in this paper This paper talks about the democratization of Brazil and the consequent reduction of poverty in the country. By democracy we imply â€Å"a political regime with free competitive elections , without major prescriptions and with universal adult suffrage†4. In a democratic country the citizens enjoy â€Å"freedom of speech and the press, freedom of political association, and individual civil rights†