Essay on Martin Luther King, Jr. - 591 Words

Martin Luther King, Jr. Martin Luther King, Jr. was born at home on Tuesday, January 15, 1929 in Atlanta, Georgia. His parents were Martin Luther, Sr. and Alberta King. He was born into a world where segregation was the law. Where his boyhood best friend, who was white, wasnt allowed to play with him once they started school. Where black people went to separate bathrooms, drank from separate water fountains, couldnt eat in whites only restaurants, and had to give up their seats on buses if a white person wanted it. Martin was a very intelligent boy. He was able to enter Morehouse College at 15 simply on the strength of his scores on the college entrance exam taken during his junior†¦show more content†¦D. in systematic theology. Upon graduating, he accepted a call to preach at the Dexter Avenue Baptist Church in Montgomery, Alabama. On December 1, 1955, Rosa Parks was arrested for not giving up her seat on the bus to a white man. The Montgomery Improvement Association (with King as their president) organized the boycott on the bus company that lasted 381 days and lost them 65% of their profits. In 1957, Martin helped found the Southern Christian Leadership Conference and was its first president. Martin was arrested 30 times and spent time in jail (where he wrote Letter From Birmingham Jail), had his house bombed, was arrested once for driving 30 in a 25 mph zone (havent we all done this at one time or another), was stabbed, and finally, was assasinated. In 1964, because of his work in the Civil Rights Movement, he was awarded the Nobel Peace Prize for being someone who had contributed the most to the furtherance of peace among men. In 1965, President Lyndon B. Johnson signed the Voters Rights Bill into law. This law guaranteed that No person in the United States shall, on the ground of race, colour, or national origin, be excluded from participation in, be denied the benefits of, or be subjected to discrimination. From March 16 - 21, 1965, Martin lead a group of 3200 people in a protest march from Selma toShow MoreRelatedMartin Luther King Jr.867 Words   |  4 Pagespeople, one of them is Martin Luther King Jr. He made the world a better place for black citizens by doing non-violence movements and marched the way to freedom. Martin Luther King Jr. was born on January 15, 1929, in Atlanta Georgia as Michael King Jr., but changed his name to Martin Luther King Jr. in honor of Protestant Martin Luther. Through his activism, King played a pivotal role in ending the legal discrimination of African American citizens. During his childhood, Martin Jr.’s father stronglyRead MoreMartin Luther King Jr1194 Words   |  5 Pagesï » ¿ Simmons 1 Gabrielle Simmons Mrs. Fitzgerald Social Studies 8A 4/27/10 Martin Luther King Jr. Martin Luther King Jr. is a well known and an inspiring man to all cultures of the world. King was and still is one of the most influential heroes. King s views and believes helped African Americans through the 50 s and 60 s to the rights and liberties that was their right. King faced many obstacles on his journey, things like jail and even assassination attempts. Despite these obstacles,Read MoreMartin Luther King Jr.1078 Words   |  5 PagesMartin Luther King, Jr., was a very strong person, constantly fighting for what he believed in, which was equality for African Americans. He was not scared to stand up and tell the world what he wanted for society. He was fearless and did everything in his power to prove a point. Martin Luther King, Jr., was the strongest individual of his time, for he fought until death, which proves how much he was willing to risk his life to make the world an equal place. Growing up, he had a very interestingRead MoreMartin Luther King, Jr Essay1153 Words   |  5 Pagesbe slaves, African-Americans saw a road trip to equality through the eyes of Martin Luther King, Jr. Even after being emancipated from slaves to citizens, African-Americans were not ready to wage the battle against segregation alone. The weight which African Americans carried on their back, was lightened when they began to see what Martin Luther King, Jr. brought to the table against segregation. Martin Luther King, Jr. was the single most important African-American leader of the Civil Rights MovementRead MoreBiography of Martin Luther King, Jr745 Words   |  3 PagesMartin Luther King, Jr. (January 15, 1929-April 4, 1968) was born on in his mothers parents large house on Auburn Avenue in Atlanta, Georgia. He was the second child, and was first named Michael, after his father. Both changed their names to Martin when the boy was still young. King JR was born into a financially secu re family middle class with that, They received better education in respect to most people of their race. King Jr, noticed this and this influenced him to live a life of social protestRead MoreMartin Luther King Jr.1144 Words   |  5 PagesMartin Luther King Jr. (January 15 1929-April 4, 1968) Brief Summary (of who MLK Jr. is): Martin Luther King Jr. was a Baptist minister and an activist who led the civil rights movement in the 1950. He was a fundamental force behind the civil rights movement that ended legal segregation. He was awarded the Nobel Peace Prize in 1964. But he was sadly assassinated in 1968 on a second floor balcony of Lorraine Motel in Memphis, Tennessee†¦ Childhood: Martin Luther was never poor. He lived with a middleRead MoreMartin Luther King Jr.2405 Words   |  10 PagesMartin Luther King Jr. was a Baptist minister and social activist, who led the Civil Rights Movement in the United States from the mid-1950s until his death by assassination in 1968. IN THESE GROUPS NOBEL PEACE PRIZE WINNERS FAMOUS PEOPLE WHO DIED IN 1968 FAMOUS PEOPLE WHO WENT TO PRISON FAMOUS CAPRICORNS Show All Groups 1 of 19  «  » QUOTES â€Å"But we come here tonight to be saved from that patience that makes us patient with anything less than freedom and justice.† —Martin Luther King Jr. Read MoreMartin Luther King Jr. Essay1862 Words   |  8 Pagesbut the content of the character,† (Martin Luther King Jr,1963) Martin Luther King Jr. was a smart child and had a good childhood. He learned values from his parents, and Martin Luther King Jr was a man of much wisdom during his time. He was a major contributor to the civil rights movement, and those contributions have profound effect even today. Michael Luther King was Martin Luther King Jr’s name when was born. His parents changed his name to Martin Luther King when he was just a young boy. TheyRead More Martin Luther King Jr. Essay637 Words   |  3 Pages Martin Luther King, Jr. was perhaps one of the most influential person of our time. As the father of modern civil rights movement, Dr.Martin Luther king, Jr., is recognized around the world as a symbol of freedom and peace. Born January 15, 1929, King was the son of an Atlanta pastor. King accomplished many achievements during his life. He graduated from Morehouse as a minister in 1948 and went on to Crozer Theological seminary in Chester, Pa., where he earned a divinity degree. After that KingRead MoreThe Legacy of Martin Luther King Jr.1123 Words   |  4 PagesMartin Luther King Jr. (January 15, 1929 - April 4, 1968) was known as an activist and a remarkable leader for African Americans throughout the Civil Rights Movement. He was put in jail for his non-violent civil rights campaigns, spoke out for racial justice, and tried to find an end to racial discrimination. King’s legacy is still known present day, and continues to be one of the most well known leaders. Throughout Martin Luther King Jr.’s lifetime and the Civil Rights Movement, King was devoted

Vertical Boundaries Free Essays

Chapter 10: Vertical boundaries Chapter 10: Vertical boundaries Aim of the chapter To understand the factors that influence the ways in which transactions on a vertical chain (value chain) should be/are located on the market–organisation continuum. Learning objectives On completion of this chapter and the essential reading, you should have a good understanding of the following terms and concepts: †¢ transaction cost economics †¢ strategic calculation. Essential reading Buchanan, D. We will write a custom essay sample on Vertical Boundaries or any similar topic only for you Order Now and A. Huczynski Organizational behaviour: an introductory text. (London: Prentice Hall, 2008) Chapter 18. Douma, S. nd H. Schreuder Economic approaches to organisations. (London: Prentice Hall, 2008). Further reading Besanko, D. , D. Dranove and M. Shanley Economics of strategy. (New York: Wiley, 1996). Coase, R. H. ‘The problem of social cost’, Journal of Law and Economics 3 1960, pp. 1–44. Grossman, S. and O. Hart ‘The costs and benefits of ownership: a theory of vertical and lateral integration’, Journal of Political Economy 94(4) 1986, pp. 691–719. Williamson, O. E. ‘The economics of organization: the transaction cost approach’, American Journal of Sociology 87(3) 1981, pp. 548–77. 10. 1 Introduction As noted in Chapter 1, we may regard the basic unit in organisational analysis as an exchange or transaction generated in the division of labour. The division of labour (exogenous/endogenous – Chapter 3) creates value or vertical chains; for example as shown in Figure 10. 1(a) running from crude oil extraction to the retailing of petroleum products. We now operate at the level of organisations or firms (recognising that at a greater level of disaggregation the points in the chain are also based on chains of the division of labour) and pose the question as to where their boundaries should be located on the value chain. In fact the picture is usually more complex than the one depicted in Figure 10. 1(a). Activities usually depend on inputs at all points down the vertical chain, as depicted in Figure 10. 1(b). So organisations or market exchanges could control and coordinate each of these transactions. Furthermore, some of these inputs may be common to the points on the main chain (see Appendix 1. 2 in this guide), like accounting services, in which case the picture looks more like Figure 10. 1(c). Note the use of di-graphs once again. 91 Organisation theory: an interdisciplinary approach a) Oil extraction Refining Retailing †¢ (b) Shipping or pipe †¢ †¢ †¢ Distribution †¢ †¢ †¢ †¢ (c) †¢ †¢ †¢ Accounting †¢ Figure 10. 1 †¢ †¢ †¢ In general we are asking the question as to whether a particular transaction should be internalised (make) or left in the market (buy), as depicted in Figure 10. 2; that is, whether a point on the cha in should be a department/ function or division or remain independent. For the moment we restrict our attention to this simple choice rather than the more elaborate positioning on the market–organisation continuum. We shall return to the more elaborate issue later on. †¢ †¢ Market (Price mechanism) Figure 10. 2 Start by asking what the benefits and costs of using the market might be. The benefits could include the following: †¢ Independent firms may be able to reap the benefits of economies of scale (i. e. operate at an output that minimises unit costs) whereas internal departments may not. Unless the firm itself can absorb all the efficient output of the department, it must either operate below the optimal output level or sell on to another firm. This might compromise any information advantages of the purchasing firm (see below). †¢ Independent firms are more subject to market disciplines than departments and may hold down costs they can control more effectively. Costs may be difficult to identify in departments. Firms might, though, attempt to replicate market incentives inside organisations. Tapered integration refers to a situation where a firm is supplied partially by an independent firm and partially by its own department. This allows their relative cost structures to be compared. Independent firms (i. e. their managers) may have stronger incentives to innovate when compared with managers of departments. †¢ †¢ Organisation †¢ 92 Chapter 10: Vertical boundaries The costs of using the market might include the following: †¢ Private information may be leaked to independent firms – particularly if there is a need to share technical information. †¢ The focal firm becomes to a degree depende nt upon an independent supplier (depending upon switching costs). Thus the latter has a power resource (see Chapter 6) and may use it to hold up the focal firm. It may prove difficult to control and co-ordinate flows of goods and services down a vertical chain of independent firms. This may be particularly so where there is a need to fit the products closely. ‘Just-intime’ methods seek to overcome this problem and permit independent firms often with long-term relational contracts (see below). The way most economists (following Coase and Williamson) think about the choice between a market and organisational exchange/transaction is entirely predictable – choose the arrangement that minimises costs. The innovation here is to ntroduce the idea of transaction costs – the costs involved in making (controlling and co-ordinating) the transaction. They are sometimes referred to as agency costs, and agency efficiency is found where they are minimised. So, if both production costs (which relate to technical efficiency) and transaction costs vary between organisational transactions and market transactions, then the total costs should be minimised. Activity Now read Sections 8. 1 and 8. 2 in D and S. If you would like to read a slightly more comprehensive economic approach to vertical integration, then read Besanko et al. 1996). In a world of fully informed, rational actors where contracting is complete, there are no transaction costs and the choice between market and organisational exchange is of no consequence (at least as conceived within this framework) unless production costs vary (which, again, they should not under the same assumptions). It is because we relax both the assumptions of full rationality and full information in the context of ‘real markets’ that transaction costs arise and the choice between market and organisational transaction is pertinent. Transaction costs theory is used both in a normative and positive sense. The new assumptions are as follows: †¢ Individual bounded rationality: people are intentionally rational but limitedly so. Individuals are neither able to make very complex calculations nor to assimilate large amounts of information. As you might expect, sociologists tend to like this assumption; they see it as more realistic than the full assumptions of rationality. †¢ Opportunism: individuals are not only self-interested but behave with guile. For example, in the context of game theory, individuals will issue promises which are not credible, make use of asymmetric information and they cannot be trusted. †¢ Contracting about transactions is incomplete because of inherent uncertainty and incomplete information. †¢ Contracting can thus lead to ex ante opportunism (namely, adverse selection) and ex post opportunism (namely, moral hazard). †¢ These hazards will be exacerbated to the degree that there is little choice of transacting partners and therefore reputations (see Chapter 7) in respect of third parties will not constrain opportunism – small numbers exchange. 3 Organisation theory: an interdisciplinary approach †¢ Anticipated repeated interaction will make reputations important to both parties but if in the process there is learning by doing, it is then costly to later switch exchange partner. Williamson (1981) calls this the ‘fundamental transformation’ – it ties the parties into the relationship. †¢ Williamson also observes that parties to a transaction might have a preference for a certain type of transaction in addition to the costs and benefits. He calls this ‘atmosphere’. In effect Williamson is introducing wider motives/utilities. Although the vocabulary introduced by Williamson is rather daunting at first sight, it has the advantage that it should link your thoughts into many of the ideas you have already encountered. Activity Think of transactions as a prisoner’s dilemma or trust game. Both parties would like to contract to achieve Pareto efficiency but each is wary of the other and in the absence of some mechanism to offset this wariness, the exchange does not materialise – the Nash equilibrium. So what mechanisms are available? You should be able to list the mechanisms. They can be derived as follows. Competitive market – the price as a sufficient statistic; here the prisoner’s dilemma does not model the situation. Organisation – three possible mechanisms which can produce the Pareto-efficient outcome rather than the Nash equilibrium are: 1. Authority and power. 2. Trust (cultural mechanisms). 3. Repeated transaction and reputation effects. As we have seen in earlier chapters, alongside monitoring and employment contracts (incentives), we expect organisations to avail themselves of a mixture of these mechanisms. But note, if we think in terms of ‘real markets’ rather than the ideal type of perfect markets, then the price mechanism is not sufficient and perhaps these mechanisms might also apply at different positions on the market–organisation continuum. We shall return to these matters later. Transaction cost economics embraces not only an unorthodox model of the individual but characterises aspects (‘dimensions’, to use D and S’s terminology) of transactions that impact upon the transaction costs. Activity Now read Section 8. 3 in D and S. The argument is that asset specificity (sometimes called ‘relation-specific assets’), uncertainty/complexity and frequency of exchange all increase the likelihood that a transaction will be placed (governed) inside an organisation (that is, make) rather than left to the market (that is, buy). Asset specificity comes in different forms: †¢ site specificity – adjacent sites, usually to economise on transport and communication costs †¢ physical asset specificity – e. g. pipeline delivering crude oil †¢ dedicated assets – assets of a particular buyer dedicated to a particular relationship †¢ human asset specificity – skills dedicated to a particular relationship which would be less valuable elsewhere. 94 Chapter 10: Vertical boundaries So we now have a predictive theory about vertical integration and, incidentally, contracting out. By and large, empirical evidence has supported transac tion cost theory – particularly the impact of complexity in the context of uncertainty – though one should bear in mind what Williamson terms ‘atmosphere’. If there are widespread specific preferences – for instance, managers might prefer the power implied by organisation – this would complicate the picture. Furthermore, other factors might influence the choice between market and organisation. Regulation and taxation can confer advantages in deciding where profits are generated. For instance, taxation might favour small firms, and firms operating across different national tax regimes may find it an advantage to contract out. An organisation might vertically integrate to gain a monopoly or acquire information or to limit the flow of information to competitors (see below). Given all these possibilities, it is perhaps surprising that such strong empirical support for transaction cost theory is found. Appendix 10. 1 in this guide gives a slightly more formal approach to Williamson’s reasoning. The transaction costs approach still leaves open two questions: 1. Will the integration, if appropriate, be backwards or forwards? 2. What type of organisation – e. g. centralised or decentralised hierarchy? (I leave an answer to this question to Chapter 12. ) An extension of transaction costs theory called property rights theory (which is not covered in D and S) provides an answer to the first question. When a transaction is internalised within an organisation, then ownership should (note the normative word) go to the party with the greatest impact upon the post-contractual rents. Activity Although this theory falls beyond this course, you might like to read Grossman and Hart (1986). Property rights theory is essentially a theory of bargaining power. Incomplete contracts mean that residual extra-contractual control of assets is important. Ownership confers bargaining power over operational decisions when enforceable contracts break down. Anticipation of post-contractual hazards determines earlier investment decisions. We now need to complicate the picture by reintroducing the market–organisation continuum, as in Figure 10. 3. I use the term ‘continuum’ with a certain amount of licence as the alternative positions on it vary in a number of respects and could be reordered. The continuum runs from perfect competition, at one end, to integration or organisation, at the other. The question now is: where should a transaction be placed on the continuum? Before answering this, let us look at what B and H have to say about the issues we have been discussing. 95 Organisation theory: an interdisciplinary approach Spot markets (perfect competition) Real markets Bargaining Franchising Long term contracts (network organisations) Tapered organisations Virtual organisations Alliances Joint venture Monopoly (small numbers) Externalities Asymmetric information Fixed cost (risk to supplier) Risk sharing Cost plus (risk to buyer) Decentralised Integration (up/down) organisation Figure 10. Activity Now read Chapter 18 in B and H. Again, this chapter in B and H is extremely detailed; you need to master the main ideas running down the left-hand margin. None of them is inconsistent with anything you have learned from D and S; though note that the definition of vertical integration is in fact backwards vertical integration. Table 16. 3 in B and H gives a good overview of what I have termed the organisation–market continuum. So let us now retur n to the continuum – see Figure 10. 3 – keeping the rich descriptions in B and H’s chapter in mind. First, look at what I have termed ‘real markets’. Here we recognise that in the real world the market environment is often far from perfectly competitive. If the transaction is left to the price mechanism, then various market distortions may undermine the price as a sufficient statistic. If, for instance, a supplier holds a monopoly, then backwards vertical integration may look attractive to a buyer. Likewise, a buyer might be tempted to vertically integrate backwards in order to acquire information or to reap benefits of vertical synergies (externalities). Long-term contracts (which will inevitably be incomplete) enable organisations to engage in a protracted relationship. They often occur between buyers and suppliers in a vertical chain. D and S introduced the idea of ‘relational contracting’ (an equivalent term). Remember, whenever you think in terms of contracts you need to think of the incentive, risksharing and information aspects. Fixed-term contracts put the risk of, say, increases in input prices to the supplier on the supplier’s back. Cost plus contracts reverse the situation. Between these two extremes, risk-sharing contracts can be designed. If the buyer and supplier have differing risk preferences then, other things being equal, an optimal contract can be found. Network and virtual organisations (see B and H) are usually based upon long-term relational contracts, as are alliances. Joint ventures imply equity contribution from both the supplier and buyer. Centralised 96 Chapter 10: Vertical boundaries So the question now is: where should a particular exogenously generated (by the division of labour) transaction be placed on the market–organisation continuum? (The normative question. Alternatively, where is it placed and why? (The positive questions. ) Transaction cost economics claims to be both normative and positive and answers both questions – minimise transaction and production costs! But as we have seen, this is only part of the story. Activity Now read Section 9. 8 in D and S. In summary, the choice of the position of any vertical transaction on the market–organisation continuum may be shaped b y: †¢ economies of scale †¢ anticipated information leakage †¢ acquiring information †¢ transaction costs †¢ residual property rights †¢ market imperfections †¢ regulation. But how are these various strands to be woven together? Unfortunately there is, as far as I am aware, no embracing theory. B and H introduce you to the concept of corporate strategy and to what many organisation theorists term strategic choice. Although the idea that organisational arrangements designed to control and co-ordinate activities are a matter of choice was first introduced by sociologists in reaction to an earlier tradition that spoke of ‘determinism’ – often technological determinism – we can now see this as an unhelpful distinction. Economists will always speak of choice where changing technology might either enhance or restrict the opportunity set which rational decision-takers face. We might then like to think of technological determinism when for whatever reason, the opportunity comprises a single option. I encourage you to think in these terms even if you want to question the restrictive notion of rationality (see Chapter 1). Activity Now read Chapter 9, particularly Sections 9. 1–9. 7, in D and S. Sections 9. 1 to 9. 6 of D and S cover issues of strategic planning that impinge upon organisation theory but are more often encountered in courses on management theory. You will benefit from reading them but they are not central to this unit. The central idea in management theory concerns the sources of what is termed sustained competitive advantage (SCA). Why do some firms/organisations manage to sustain a better performance than their competitors, while operating in the same markets? Statistics tend to suggest that this is a common experience in many markets. Firms often earn above-average returns (loosely rents) on their assets over relatively extended periods of time. The assumption is that they have some characteristics (but which? that their competitors find it difficult to replicate or improve upon, at least during the time in which the advantage is sustained. From an organisational theory point of view the question to ask is – are there ways of organising which can confer SCA? Notice that when an organisation possesses a competitive advantage, for whatever reason, then this implies that perfect competition is not operating. In so far as those running organisations seek SCA, they are trying to undermine 97 Organisation theory: an interdisciplinary approach competitive forces. The early sections of D and S’s chapter show how game theory is an indispensable tool in studying competitive strategies. 10. 2 Vertical contracting and strategic choice Consider a transaction between B and S, as in Figure 10. 4. The problem is to design a contractual relationship to gain any possible rents. In terms of competitive advantage this amounts to placing the transaction on the market–organisation continuum more effectively than the competition. Assume that there is need for relation-specific assets and a complete contract cannot be signed because of inherent uncertainties. Suppose now that B would like to persuade S to make the relation-specific investment. S’s ex ante problem is that in the absence of trust and credible promises, s/he anticipates that, once the investment is made, B will take advantage of the situation. S anticipates that B will always be able, once the contract is entered into, to find contingencies not covered by the contract. By making the investment, S in effect confers bargaining power upon B – who may even use this power to renegotiate the original contract (attempt to reduce the price of the good or service exchanged). S will then anticipate these moral hazards and accordingly not invest; the transaction will fail and both S and B will be less well off than they could be. Thinking in terms of the (for the moment, one-shot) prisoner’s dilemma, S and B find a Nash equilibrium rather than the Pareto-efficient outcome. So what can be done to achieve the Pareto superior outcome? S Figure 10. 4 B Some possibilities (neither exclusive nor exhaustive) are: †¢ B makes the relation-specific investment (but then B confers bargaining power to S) †¢ B nd S make a joint investment – an alliance or joint venture †¢ S continues to make the investment but enters into a long-term contract with B (note that relation-specific investments tend to imply long-term relationships in the first place) †¢ forward or backward integration (here non-market incentives/ monitoring/authority/power/culture achieve the move from the Nash equilibrium to the Pareto outcome). But let us continue to assu me that B wants to find a non-integration solution and still to encourage S to make the costly upfront relation-specific investment. S/he might do this in the recognition that S, as an independent organisation, may be relatively small, flexible and focused. S, furthermore, may be driven by a more entrepreneurial spirit than if it were to be a division or department in B’s ‘bureaucracy’. An independent S may be more innovative. Also small organisations tend to have lower labour costs (production costs). If so, then both S and B can benefit. The strategic problem is whether or not the transaction costs (ex ante and ex post) can be kept down while reaping these potential advantages. To offset S’s anticipated moral hazard problems, B needs to search for ways of reducing her/his own and increasing S’s relative bargaining power. To the degree that this proves possible, the strategy will offset S’s anticipated moral hazards. B needs to make her/himself more dependent upon S before the contract is signed. One notable way s/he can secure this is to decentralise some design and innovation responsibilities to S. B now becomes partially dependent 98 Chapter 10: Vertical boundaries upon S. Furthermore, B can commit not only to a long-term contract but also to relatively unconditional contract renewal. These strategies do of course put B at some risk. But since we are thinking in terms of incentives to transact, you should by now recognise that risk-sharing is another aspect of the possible contracts between S and B that can be subjected to strategic reasoning. Not unreasonably, I think, assume that S is risk-averse and B is risk-neutral. So S will accept a reduction in rent in order to reduce his/her risk and, relatively speaking, B will be prepared to shoulder more risk. So, a risksharing, long-term contract can conceivably lead to a Pareto improvement. Think in terms of post-contractual price negotiation. With a fixed-cost contract any increase in S’s costs will have to be borne by S. S will be reluctant to sign such a contract. With a cost-plus contract, on the other hand, B will bear all the risks of S’s cost increases. Furthermore, S will have no incentives to hold costs down nor, perhaps more importantly, to innovate in order to reduce costs. Clearly, B wants S both to innovate and, where possible, to hold down costs. It is not in B’s interests to take the risk from S and undermine these incentives. How can s/he provide appropriate incentives while reducing S’s risks and in so doing make the contract interesting to S? What B needs to do is to accept those risks of cost increases which S cannot control while making S responsible for those s/he can control – a tricky business. B needs to know the nature of S’s cost structure (an information problem – no problem with full information but with information asymmetry it is another story) before s/he can achieve this. Of course, integration might dispel this problem but then we encounter the bureaucratic losses mentioned above. What can B do? Go back to your principal–agent model (see Chapter 4). We can regard B as a principal and S as an agent. P (B) can acquire information by having more than one agent (S) operating in the same environment (in practice this is not easy). This is called multiple sourcing. It could be achieved by either multiple external sourcing or having an in-house comparator (tapered sourcing). But, of course, one needs to ask whether B’s sourcing requirements are of sufficient magnitude to reap any economies of scale across the multiple sources. If not, would it be sensible – from an information leakage point of view – to allow the sourcing organisation to sell to other organisations on the open market? If B has decentralised design to S then this might prove hazardous. As we have observed, long-term relationships (see Chapter 8) can invoke trust and reputation effects. Traditionally it was assumed that one of the advantages of integration into an organisation derives from the repeated interaction effects. B and S being in the same organisation, they repeatedly interact and, indeed, they will assume that there is a high enough probability that they will once again interact in the future. Thus prudent calculation can overcome the moral hazards in incomplete contracting. In game-theoretic terms B and S may play TFT (the folk theorem). B may also wish to protect her/his reputation for fair play. In short, an organisation can control and co-ordinate vertical relations by cultural means. However, long-term contracts with a continuation clause also produce repeated interaction (the Japanese were largely responsible, in the 1980s, for recognising this) and, thus, reputation and trust can be generated at other points on the market–organisation continuum. Cultural mechanisms can operate outside formal organisations. If B and S can trust each other not to behave opportunistically, then the advantages of S’s independence and reduced transaction costs can be realised. 99 Organisation theory: an interdisciplinary approach Finally, reverting to an extended value chain where S’s suppliers are also brought into the picture, we obtain the situation as in Figure 10. 5. †¢ †¢ R S B Price and market gt; †¢ gt; †¢ †¢ R S B Long-term contracts gt; †¢ gt; †¢ †¢ R S B Organisation span of co-ordination = 3 gt; †¢ gt; †¢ Figure 10. Should the whole chain be co-ordinated by integration (span of coordination) or perhaps co-ordinated by long-term contracts, etc.? If the latter, should B contract with S and R or should B contract with S and S with R? In either case we have examples of network organisation and even virtual organisation if the relationships are mediated by modern information technology. The strategic complexion of these sorts of organisa tion is little understood. Why don’t you have a go! I hope this section has given you some appreciation of how to analyse organisation choices from a genuinely strategic point of view. Much of the above reasoning can be underpinned from a game-theoretic standpoint. This further supports my earlier contention that modern organisation theory often requires a knowledge of strategic thinking and game theory. A reminder of your learning outcomes On completion of this chapter and the essential reading, you should have a good understanding of the following terms and concepts: transaction cost economics strategic calculation. Sample examination question 1. Explain why a transaction should be placed in a market or an organisation. 100 How to cite Vertical Boundaries, Papers

Effect of Urbanization on Obesity and Diabetes in India - Sample

Question: Discuss about the Effect of Urbanization on Obesity and Diabetes in India. Answer: Introduction India like any other nations in the world is experiencing high mortality rates due to the prevalence of obesity and diabetes (Bowen et al., 2011). A person is considered obese when his body mass index abbreviated as BMI is above 30kg/m2, with a range of 25 to 30kg/m2 defined as overweight. As it is evident, diabetes is a chronic disease in which the bodys ability to respond or produce insulin (a hormone) is impaired, hence resulting in unusual metabolism of Carbs (CHOs) plus elevated levels of sugar in the body, especially urine and the blood. Over the decades the prevalence of diabetes has been witnessed in India especially in the urban centers. In the early 1980s only 5% of Indian adults living in urban centers had diabetes, but in 2004 the figure had already risen to 15% (Ebrahim et al., 2010). In the suburban areas of India, diabetes is less common, with a rate of 6% which is almost a third of the prevalence in urban areas. Obesity has also been a contributing factor to the wides pread of diabetes. Studies show that urban areas have registered high rates of obesity compared to rural areas, especially the case of India. Ebrahim et al. in their study used a cross- sectional study to investigate the effect of urbanization on obesity and diabetes in India. The hypothesis that rural-urban migrants had greater risks of being obese as well as developing diabetes was analyzed and compared with the rural dwellers Methods Used. Using a framework of CVD hazard ratio, the study was conducted in four companies in the cities of Lucknow, Nagpur, Hyderabad, and Bangalore in the urban center of India. Out of these factories, the workers were recruited using an employer record as a sampling frame. In the recruitment, it was ensured that the workers were rural to urban migrants. Each of the recruited employees was asked to invite a non-migrant of their next kin of their age living in rural areas. When recruiting, the invitees were given priority in regard to gender and where the sex was the same the person close to the age of the worker was considered. Out of this exercise,' the rural dwellers recruited were from 20 states compared to the 29 Indian states, hence showing a migratory trend of the four factories labor force. Out of the invited non-migrants, 25% of them were randomly selected to participate in the study. However, the study commenced on March 2005 and lasted for 31 months. In the study, standing height w as taken using a stadiometer and the weight measured with shoes off and on light clothing. They were also examined for blood pressure and interviewed to obtain any data regarding alcohol consumption or tobacco use such as smoking of cigarettes. Obesity and diabetes-related outcomes were also assessed where the diagnosis of diabetes was made using a WHO fasting plasma sugar criteria of 7.0 millimoles per liter. Homeostasis model assessment scores (HOMA) for estimating insulin impairment were also established using a standard formula of blood glucose on the aspect of the initial approach. In the study, a dietary assessment was done using a food frequency questionnaire. To check for the worthiness of the questionnaire, sub-samples were pledged to fill questionnaires (n=185) and (n=305) following the completion of the survey in an initial data collection. Other 530 participants were subjected to the reference technique of 24-hour dietary recalls that were used to authentify the food frequency questionnaire. Besides, their fat intake was measured. Another method that was used in the study was physical activity where the interviewer-administered questionnaire was used to check the physical activity plus other usual daily occurrences. The validation of the questionnaire was done in 45 urban as well as 49 rural participants via making comparisons with the 24-hour activity diary plus uniaxial accelerometer. Moreover participants were urged to attend fasting where the period of the final meal was noted. Their blood samples with an exclusion of sugar assays was alienated and then stored. Lastly, men and women were analyzed each differently as it were foreseen that gender sensitivity might bring differences in the migration effects hence the cause of obesity and diabetes. Since the participants were from different factories and of different age, adjustments were made regarding such. As the rural group was expected to have fewer risks of obesity and diabetes compared to their counterparts in the urban group as postulates in the hypoth esis, a trend test was done scoring the groups 1 up to 3 as well as using R .T or likelihood ratio tests. Another hypothesis of whether the effect in migrant plus rural group was the same was also conducted and the analysis made using STATA 10. Findings Workers records showed that 21, 663 employees in the four cities/factories were available for the study. About 72% that is 15, 595 of those people were contacted of whom 88% about 13, 696 finished the assessment of eligibility for the study. Out of the 88%, 55% that is around 7, 595 were eligible for the inclusion reason being they were among the 25% who were randomly selected from the urban non-migrants. About 94% that is 7, 101 people conformed to complete the clinical examinations. Besides, factory employees living in suburban places and who traveled to their workplace every day were retracted from the analysis. There was no difference found in the mean age, migrant status, distance from the suburban area of origin as well as the marital status of the participants. Besides, self-reported widespread of CVD was 14.8% in non-responders a less percentage compared to the 21.0% of non-consenters and 19.4 % in responders. Ideally, there was also a difference in the smoking between respon ders as well as other groups. Out of the 6510 participants who were in the analyses about 42% that is 2723 were females. In general, 2112 were rural to urban migrants, 2111 no-migrant suburban residents and 2287 were non-migrant city dwellers. Urban males were a bit older relative to the suburban men but of the same age bracket to those of migrant males. Most importantly, the majority of migrants had spent a considerable amount of time in the urban areas with men having a median of 26 years and females 21years. Moreover, comparison of the risk factors as well as health issues between rural groups, migrants and urban has also been presented throughout the study. There was significant evidence in females and males of differences in body mass index between the suburban, urban and migrant people. Obesity was highly prevalent in urban women at a rate of 53% at 95% confidence interval and lowest in suburban men at 18% with the migrants in the intermediate position. Moreover, the occupation, age as well as the factory adjustment odds of obesity lied in the range of 3 4 fold higher in migrant compared to the suburban women and men. The urban plus migrant groups were equal concerning the MET h/d of physical activity while the suburban group had a greater MET h/.' Alcohol consumption and smoking were limited among women, however, among the migrant men, they registered the least chances of smoking while the suburban men the most. Odds of hypersensitivity in urban as well as migrant men was almost double that of suburban men. Besides, increased odds were evident in women. In both women as well as men, fasting blood sugar levels were the same in migrant plus urban groups and lowest in the suburban groups. HOMA scores registered a hierarchical trend from urban, migrant to suburban. The widespread of the disease was high in urban groups, followed by migrants and rural group the least. However, both migrant and urban males and females had over two-fold increased odds of obesity disease relative to the suburban participants. Discussion and conclusion A hypothesis that urbanization had higher prevalence of obesity and diabetes compared to the suburban non-migrants was highly supported by the findings (Ebrahim et al., 2010). On the other hand, the other hypothesis which migrants had intermediate prevalence relative to city residents was not upheld. However rural-urban migration was connected with less physical activity and increased fat consumption in males females relative to the rural residents, and this probably led to the greater obesity levels diabetes as it was witnessed in migrants. The gender difference witnessed in the study was not expected with the migration-linked differences in fasting blood sugar, hypertension, insulin, and lipids only observed in males. Also, adjustments for the body mass index in the analysis resulted in the weakening of the area of origin effect in males for lipids as well as blood pressure showing that rise in such factors among the migrants might be caused by being obese (Hernandez et al., 2012). Besides, the migration study does not separate the effect of age during the migration starting from the period of stay in the host demography. Among the Mexicans, it had been witnessed that the first generation immigrants had a good health irrespective of the low socioeconomic status compared to their counterparts, white Americans. However, such advantage decreases with the length of stay in America. Such findings imply that there might e latency of the effect of health behavior plus outcome. From the results of the study, theres evidence that influence of migration on being obese is fast, happening in the initial years of migration. This confirms findings from migrants to America. Hence, given a small number of migrant s in the research that had lived in city centers for a short while, the results needs to be viewed with keenness plus needs replication (Kaveeshwar and Cornwall, 2014). However, the aspect of access to better heath care might also play a significant role in the diagnosis of high blood pressure as well as diabetes. Besides, the subject of migration studies is not clear since the change in the health outcome might show the impact of an area of origin, the effect of the migration process itself, selection of the individuals who migrate as well as exposure to the new environmental factors such as climate. Mbanya et al., (2010) accounts that migration as an exposure is sophisticated since it entails a wide spectrum of environmental, behavioral and socioeconomic shifts. Despite the fact that data was collected using the sibling pair method, the aim of the current analysis was to compare between the urban, rural and migrant groups. Of the three groups only the migrant is paired with the rural groups while the urban group remains to be independent. However, a recent study on India gave an adult prevalence of being obese among people in the labor force of 20% in the urban centers as well as 6% in the suburban areas. This is much lower compared to the prevalence of over 20% and 40% in rural and urban ce nters respectively. Besides, in the larger survey of six major towns, the age-adjusted diabetes prevalence of 11% was registered in 2000 (Ebrahim et al., 2010). This figure is far way low relative to the urban diabetic prevalence of 15%. In a different study in India, a diabetic prevalence of 15 % was reported. Findings from this study confirm an earlier finding of high levels of insulin in cities relative to the suburban participants. This shows that a few of the impacts of rural to urban migration might be due to biological factors which lead to an increased (Yajnik, 2004). Insulin secretion in the body because of the cells resistance. The findings presented in this study conforms to other findings on migrants from other studies where greater level of insulin have been witnessed in Indians living overseas,' in demographics from other developed nations going through swift rural to urban migration as well as in migrant demographics elsewhere(Millet et al., 2013). The response rates presented in this study might have been lower compared to the anticipated large due to the logistic complexities of the sibling pair method. But in some of the instances, they involved say a day to reach the study station plus another day to commute back to the suburban sibling. Also, a difference in the smoking prevalence between the non-consenters, non-responders, and responders was persistent with a play of chance. To sum it up, urbanization is connected with increased prevalence in being obese that drives other risks such as cardiovascular diseases and diabetes to mention just a few (Misra and Ganda, 2007). 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