The Chinese government needs to create a system to supervise their economy like the U.S. did when we went through the progressive era and created the F.D.A., along with many other reforms. All in all, China has a major quality control problem that needs to change soon, before other countries stop trading for and purchasing Chinese goods and the country's economy comes crashing down. This could be a major tragedy because China is the most populous country in the world. Over one billion people would suffer severe hardship if China's economy fails.

I think this is a serious, serious problem. Looking around my room, I would say that approximately fifty percent of my belongings are made in China. Now, I am not saying that all of these products do not work or that I am going to die because I use Chinese materials, but I am a little scared. What if the snack I am eating right now is contaminated? What if the treat I am feeding my dog is contaminated? What if all my stuff falls apart in the next few years or the toy I used to put in my mouth when I was little had lead paint on it and I died of lead poisoning (okay, probably not)?

Still, just knowing that this is happening, and that my family or friends might be hugely affected, is an unsettling thought. I hope the Chinese government will be able to quickly make the changes needed to get their production standards and economy back on track. I think that having a period of reform or a “progressive era” is just what they need. I would get them back on track and would certainly be a good sign to the whole world seeing as how their economy plays such a big part in the economy of other countries, and who knows it may lead to the stabilization of the Chinese government. In conclusion, I want to be able to buy Chinese products safely and I am sure that people around the world can't wait to also, seeing as how they are one of the biggest exporters of goods.

The Howard govt has given special emphasis to labor market reform as a policy solution to reducing structural unemployment and dealing with Australia's upcoming labor shortage. Beginning with the 1996 Workplace Relations Act through enterprise level wage bargaining and wage increases in line with economic circumstances and productivity improvements, these reforms have been significantly continued with the 2006 Workplace Relations (Work Choices) Amendment Act These extensive reforms introduced a single national industrial relations system which substantially modified unfair dismissal legislation, allowed minimum wages to be more flexible and removed a number of structural and institutional impediments to the developments of an efficient labor market.

It was recognized that a more flexible system of minimum wages may initially reduce labor productivity as more low productivity workers are encourages into the workforce. In the longer term, this more flexible labor market will promote productivity by encouraging companies to innovate and improve their training programs etc.

International competitiveness:

OZ industries operate in a highly competitive global economy. If the industrial relations system produces rising real labor costs, it will make Oz industries less competitive on global markets and will affect our economic performance. The decentralization of wage determination has contributed to higher productivity growth and the cost of labor in Australia has become more competitive as a result.

Income Inequality:

the deregulated industrial relations system is increasing the degree of wage dispersion - that is, widening the gap between income levels. Workers with greater skills and who belong to stronger unions tend to receive larger wage increases under enterprise agreements, while those with less skills and in weaker position receive the smaller safety net wage adjustments.

Govt argument:

OZ should implement further changes to the industrial relations system because previous reforms have been successful and so making further changes will also be successful. The govt also claims that although it isn't broken, the industrial relations system is far to complex for the average Australian and so needs to be overhauled to encourage maximum procedural simplicity. As PM Howard said in an address to the Sydney Institute, July 11 2005 “We will forge this era only by unleashing a new burst of productivity growth that, in turn, will benefit all society.”

Arguments against:

Economic commentators like Tim Colebatch argue that Work Choices will put the current system at risk, especially because the changes will shift the bargaining power from employees to employers.

System may reflect bargaining power rather than price signals.

No mechanism to prevent the occurrence of wage-push inflation. When growth is strong and the labor force is close to full employment, workers may demand wage rises, leading to inflationary pressures and spirals

The 2006 Work Choices changes are significant in that they are probably the most radical changes proposed since PM Stanley attempted a national takeover of state industrial powers in the late 1920s. With the changes coming into effect in 2006 but their full impact only emerging in years to come, the debate over industrial relations will continue for a long time yet.

Training is more important - giving workers higher skills base

Over the years it has become one of the fastest growing economies in the world. Promotion of economic growth and development.

The Indian government is highly focused on bringing changes to the economy and promotes high economic growth. Realizing the potential of the world market and foreign investors the government has set up numerous policies, which promote investment and provide incentives for foreign and local investors.

The Fiscal budget for the year 2001/02 was released around mid February; this brought in new policies and changes including:

There are tax exemptions for 15 years for units in infrastructure and the core sectors (not specified).

This tax exemption will attract more investors to invest their funds in infrastructure and core sectors, promoting economic growth and benefiting many other businesses and consumers through flow on effects of improved infrastructure. There will also be high employment (of skilled and unskilled labor) and better living standards, which contributes to economic development.

Venture capital made simpler. This will allow small businesses to get started quicker and easier,and "made simpler- is likely to suggest the cut down of red tape to allow easy access into the market. This contributes to economic growth and creates employment and greater competition and consumer choice (as a result of increasing number of businesses). It will also attract higher direct foreign investment, which is a great benefit for the nation especially at trouble periods.

Long term capital gains tax capped at 10% for all. This would mean more people would invest in shares, which encourages businesses to expand and employment would increase. The value of the businesses will also increase because shareholders are likely to prefer capital gains overtime rather than instant returns (dividends). The businesses can now invest the profits to increase its value. This will of course contribute to the economy.

IT is given special status. The reason for this is because the Indian government wants to promote it-s nation a as a technological advanced nation and in order to do this they must stimulate the IT sector. The "special status- means the sector and investors (willing to invest in the sector) will receive many benefits and incentives from the government to do so.

Tax-free status for bonds targeted at housing development activities. This will not only lead to higher investment in property development, it will also lead to overall economic development because housing development activities include housing middle to lower class people, by providing them a better environment to live in the standards of living are dramatically improving.

10% surcharge on income tax. This may seem a peculiar decision but the government is trying to increase it-s tax base, which it can then distribute back to the public through infrastructure development, educational programs and housing developments.

There has also been tariff deductions to attract foreign investment and competition. This will have the effect of improving the competitive nature of import competing industries, and an over all growth in efficiency and output.

Promoting the economy to foreign investors:

Foreign investment policies

Majority foreign equity allowed in several sectors … allowing for easier access for overseas investors to own and manage businesses in India.

Foreign investment of up to 51% in 35 high priority areas is eligible for automatic approval, provided by the RBI. These incentives allow foreigners to invest and therefore provide an inflow of funds into the nation, promoting economic growth and development.

Goods of foreign brand names and trademarks for sale are allowed. This shows that the Indian government has realized the needs for it to become a globally integrated nation.

Foreign companies are permitted to open branches in India - businesses that set up in India will make good use of the resources available, this includes employment and use of local materials. This will boost economic growth and development as funds are injected into the economy.

Local industry incentives

The Indian government has created many incentives for domestic investors. Ensuring that the incentives comply with the economic philosophy of the government.

Tax-free status for the first five years for power projects, businesses involved in exports, units in free trade zones, infrastructure development and new industries.

Tax deductions of up to 100 per cent on export profits.

New industrial undertakings will receive a 30 per cent tax deduction on net income.

Further Economic Development the Indian government has taken greater concern in the welfare of its people. It has set up Second National Commission on labor to protect millions of workers. Ensuring they are not exploited through low wages, unreasonable expectations# etc. This has the effect of improving wage levels, and living standards among the people.

The government also uses a proportion of its expenditure on education, health, water supply, sanitation, housing, slum development, social welfare, nutrient, rural employment# etc. This ensures the people living below the poverty line (over 30% of the urban population) will receive enough benefits for them to enjoy a reasonable living standard and the future generation is given many incentives to shift away from the poverty stricken areas to become financially stable.

The government has also ensured increased availability of health care which has lead to an improvement in the living standards (improved death rate, birth rate...etc).

Example: Infant mortality rate has improved from 129/1000 in 1971 to 80 in 1994.

Impact of Globalization

The significant decline in the GDP of a number of East Asian countries, continuing recession in Japan, lack of capital growth in developing countries, unsustainable fiscal weakness in South American countries and volatility of capital and Foreign exchange markets in developed nations were a number of causes in world economic down turn in the year of 1998-99. All these factors had major impacts on India, hence the name the impacts of Globalization on India. These impacts include:

Inflation rose sharply during 1998-99. It reached a height of 8.8 per cent in September 98 it dropped steeply in January 1999. This rise in inflation was caused by numerous problems; one of them was the dramatic increase in some agricultural commodities.

Deceleration in the growth of India-s exports continued, as growth was negative for the first 9 months of 1998.

??The current account deficit fell from 1.6per cent of the GDP in 1997-98 to 1.4 per cent of the GDP in 1998-99.

There has also been a deceleration in private inflows, which lead to a lower than expected net capital inflows between 1998-99.

Manufacturing growth as a part of the GDP fell to 7.7 per cent in 1996-97 from the previous year-s level of 15 per cent. And it fell slightly to 6.8 per cent in 1997-98.

The above impacts show how closely integrated India with the global economy, many production decisions and government policies must comply with the global market situation in order for India to continue as a fast growing economy.

Positive effects of Globalization

Prior to The 80s when the Indian government undertook major reforms to relax restrictions on foreign trade and investment it suffer from a very low GNP growth rate of below 3.5%, but as a result of opening up to the global market GNP growth is averaged at 5-6% per year.

Indian Businesses are able to find new markets overseas to sell their products to, they will have the advantage of cheap resources such as labor.

Entrepreneurs from foreign nations are also able to make efficient use of these resources when they set up business in India. This of course leading to greater employment levels, greater output and overall economic development and growth.

Average real wages of unskilled labour has increased, which will lead to an increase in the standard of living.

There have been signs of improvements in living standards in the general population a s a result of economic growth and globalization. Poverty ratio has declined dramatically from 56.4% of the rural population in 1973-74 to 37.3% in 1994. The urban poverty ratio has also fallen significantly form 49% in 73-74 to 32.4 in 1993-94. These are all results of job creation and developments undertaken by the government and private institutions.

Due to the reduction in barrier import competing businesses have become more competitive leading to greater efficiency and better-priced and quality goods.

Due to Globalization developing nations such as India become more 'modernized- as new technology and industries can quickly be adopted.

Due to Globalization exports have risen dramatically leading to economic growth.

An indirect result of Globalization is the improvement in infrastructure.

Additional employment opportunities of 29.74 million jobs were created between Jan 94 to March 97.

Negative effects of Globalization

Globalization has lead to environmental damage in India (as with many developing nations).Due to large-scale industrialization urban slums have formed, air and water pollution has dramatically increased. Multinational firms have exploited resources belonging to the country and lead to land degradation. Delhi for example is the 4Th most polluted city in the world.

Though foreign investment will promote economic development in the short term, the profits earned from the business venture move out of the country. There is also a possibility that at times of recession investors (in portfolio investment) may withdraw their funds causing further problems.

Domestic resources such as labor maybe exploited my large production based firms. These firms may also abuse natural resources and use them inefficiently.

Domestic producer being overpowered my overseas giants, who already have competitive advantages over the domestic producers, and have more funds to invest. This will lead to the closure of many domestic owner firms.

Statistics

These statistics reflect the impact of the Asian financial crises on India, and it-s overall performance between 1996-98.

Gross domestic product for example has fallen due to low aggregate demand, while Gross Domestic Investment has increased due to higher incentive to invest surplus funds.

1997, 1998, 1999

• GDP Growth (%) 8 6.1 6.2
• Exports (as % of GDP) 10.9 11 10.7
• Imports (as % of GDP) 14.1 13.8 14.2
• Gross Domestic Investment (% of GDP) 25.6 23.6 29
• Savings and investment 1996 - 97 1997 - 98
• Gross domestic savings 24.4 23.1
• Gross domestic investment 25.7 24.8
• The slump in savings and investment is once again due to the impacts of the Asian financial crises.

Sectors real growth rates 1997-98, 1998-99

• Agriculture -1.0 5.3
• Industry 5.9 4.7
• Manufacturing construction 6.8 5.7
• Mining 4.1 2
• Services 8.2 6.7
• Agriculture continues to be a major growth point as it is a major part of exports.

Inflation 2000, 2001, JAN

• 3.6% 8.2%