My Most Frightening Day free essay sample

My Most Frightening Day Most people don’t have any idea when their most frightening day will be, it could have been when they were young or maybe it has not quite happened yet. I did not have the luxury of surprise although I also didn’t exactly have a day marked on my calendar. I knew my most frightening day would come when a doctor called my house and informed my family that my great grandpa Papahualo had two weeks to live, and my dad informed me that we were going to fly out there to be with him.He was like a father to my dad and he traveled with us most everywhere we went and now, we were going to be with him before his greatest journey yet. I had been planning to go to New York during winter break; I was hoping to spend time with Papahualo as I went around sight-seeing and getting to know the city. This was not the trip I had planned at all. It wasn’t during winter break, it was two weeks before classes would begin for me, and this was not how I wanted to see him.The last time I had seen Papahualo was one year before when he was strong as a horse and could still pick me up when he gave an extra strong hug. We bought the tickets two days in advance and everything happened so fast that it almost seemed like a dream. Papahualo was one of the healthiest, strongest people I knew. He was not the frail old man the doctor described over phone with his organs slowly shutting down. On the plane everything felt normal, like any other trip, I am used to traveling, but never like this.Even though the flight was short it felt like a nerve racking eternity of uncertainty, I couldn’t get a wink of sleep. I was sure I would break down sometime on the plane, if not then maybe once we got there and everything stopped feeling like a dream and became real but that moment never came. We went almost immediately to the hospital and although I ran scenario after scenario in my mind of what it would be like, I had no idea what to expect.My Papahualo’s lungs were filled with water and due to his organs shutting down, especially the kidneys and liver he didn’t look pale but instead a slight yellow color took over. As of the day before he had stopped being able to talk, he was so weak and fragile he barely resembled the man I knew wrinkle by wrinkle in my memories. He was so sedated for the pain that he was only capable of sleeping, I was told he had been slightly delusional and I wasn’t sure if he would even know who I was. The nurses and doctors had been having issues with him wanting to get up and leave.They just could not understand that nothing ever stopped him from being independent and able to live just like them only weeks before. He had raised or taken care of so many children, grand children, nephews, nieces and even great grandchildren but had never had to be taken care of to this extent. I spent the first night at his bedside on a reclining chair, it was not the most comfortable sleeping arrangement but it was better than the chair my aunt kindly offered to sleep in. The first time he opened his eyes I filled with excitement and fear all at the same time. I leaned in and asked if he knew who I was, he whispered â€Å"of course† and squeezed my hand as if he would never let go. That’s what I wanted deep down, I never wanted to say goodbye I had never even so much as given a thought to it. How do you say goodbye to someone who has always been there and watched you grow? How do you let go of someone who has meant so much to you for so long that a future without them seems impossible? I was holding my breath waiting for him to take his last. It is the scariest thing I have ever had to do.The second night I spent the same, just holding his hand and staying awake until around six in the morning when my aunt or uncle would wake up and take over my shift, the nurses were not the only ones up around the clock. By the third night my family may as well have locked me up in my aunts’ house, they insisted I need to take care of myself too and finally go home, eat a good meal and get some real rest. The fourth night was my last night in New York. My great grandpa had finally been transported to a hospice and we knew it was now only a matter of time.It was decided that my two aunts and uncle would stay overnight with him but I begged and was allowed to stay instead of my uncle. He was surrounded by family from the beginning but now even more than ever with people from the area were even coming to visit trying to give their last goodbyes and sharing memories with the rest of us. He was so respected, admired, and loved; no one ever had anything bad to say of him and this was not just because of the circumstances. As it got later the family proceeded to clear out, leaving me with my aunts.I was reading my book and positioned myself as usual by his bedside until the familiar sound of his peaceful breathing began to change and slow down. Was this the moment everyone has been dreading? I put my book down, got out of my chair and walked closer. I wasn’t alone because my aunts immediately were asking him if he was okay and comfortable enough and the mandatory things they’d say when he opened his eyes or got their attention. As he was breathing slower and slower my heart raced faster and faster, I squeezed his hand and I felt him still holding on.I looked into his eyes and tried to find a conscious mind behind the stare but there was none. My aunt called her sister and explained their dad wasn’t breathing the same â€Å"he’s breathing too slowly, he’s taking so long to breathe †¦he’s not breathing anymore†. I closed his eyes for him, which I felt was an honor because only one person could ever put you at your final peace like that. I didn’t say anything because there was nothing left to say, I had been talking to him in the few moments we had alone and he knew I loved him very much. Words were not needed at the moment just a few silent tears. Then came the duty of delivering some phone calls out to family, and I had to maintain calm. I cannot describe all the emotions I went through in those four days; twenty six letters in different combinations could not possibly express the love, pain, exhaustion and fear that passed through me. I have never seen someone losing their life slowly before my eyes, but it’s a feeling I will never forget and one that scared me beyond what I can explain. I don’t wish it on anyone but in a way I also do feel special to have truly been there until the very end. Rest in peace Marino Eduardo Pacheco Alegre, better known as my Papahualo.

Essay and the Third Person Story Essay Sample

Essay and the Third Person Story Essay SampleA third person essay is a pretty easy task to perform. All that is needed is for the student to come up with a story in which they have an element of influence. There are different types of stories that can be considered here, and the various exercises can be performed with the help of a third person essay sample.The first level of the exercise can be done by coming up with a story from a book which can be considered like the first person literature. In this case, you would have to come up with an account of what you have read. At the end of the story, you will have to explain why it was so good.The second level of the exercise can be done by coming up with an amendment to an article or book which was written in the first person. In this case, you would have to come up with an explanation of why the writer made a change in the story, the scenes and other elements which were not well executed in the original. This can be done by coming up w ith a new version of the story. This is one of the best examples of a third person essay in which you can also come up with a new definition of the terms which were not used in the original.The third level can be done by writing a story based on any subject which is related to the same topic as the original and comes up with the same conclusion. This is one of the better cases where the teacher can use the third person essay sample.The fourth level of the exercise can be done by coming up with a new understanding of the whole event. This would be done by coming up with a narrative which is entirely different from the one which the teacher gives in the class. This is where the reader can come up with a new understanding and interpretation of the whole story.The fifth level of the essay sample can be done by coming up with a story which revolves around the person from whom the author got the information. In this case, the teacher can come up with the response to the question asked by the student. This is one of the best and easiest forms of the story in which the student can come up with a new perspective of the events which he had already been exposed to in the class.The sixth level of the essay sample can be done by coming up with a new strategy in the same manner as the previous levels. At the end of the story, the teacher will have to explain the strategy used in the story. This is another one of the best ways of coming up with a third person essay in which the student can come up with a new understanding of the situation.

Factors Affecting the Changes in Oil Price

Introduction Statement of the thesis The decline in oil prices is likely to cause an increase in consumption, a decrease in inflation, and an increase in real GDP growth rate in the next few years. In recent times, oil prices have been falling and seem to stabilize at around 40 dollars a barrel.Advertising We will write a custom research paper sample on Factors Affecting the Changes in Oil Price specifically for you for only $16.05 $11/page Learn More This paper will examine factors determining the changes in oil price and how it affects the country’s economy, with a focus on the U.S. economy. There are uncertain reasons regarding this recent steep fall in oil prices, such as temporary and permanent shifts in oil demand and supply, such as the entrance of the United States as a leading producer in the market. We will further investigate how changes in oil prices affect a country’s GDP and its economy as a whole, considering selected economi c indicators such as nominal and real interest rates, real GDP growth rate, real wages, and final consumption. If the change in oil prices has a strong influence on the rate of inflation, there is a need to specify the actions that policy makers should consider in response to the changes. Statement of the problem/ issues The main problem is to find out whether there is a strong association between crude oil prices and other economic indicators, such as interest rates, final consumption, real GDP growth rate, and inflation rate. If there is a strong correlation between oil prices and selected macroeconomic indicators, the government should consider an intervention to protect the economy from fluctuations in oil prices and the rate of inflation.Advertising Looking for research paper on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More The decline in oil prices is likely to cause a decline in export demand because of reduced i ncome from oil exporting countries. The decline in oil prices is also associated with a decline in investment in the oil gas sub-sector (Baffes at al., 2015). Reduction in investment in the sub-sector may have a small negative impact on aggregate demand. There is uncertainty on how long the low prices will last. It may prevent interest rates from dropping further when interest rates have a correlation with oil prices. If the low prices are short-lived, any intervention from the government will cause a distortion that may last longer than expected. Blinder Rudd (2008) suggest that a rise in inflation raises concern in a similar manner to disinflation. Nelson (2004) discusses that the economic policies should not react to the changes in oil prices in a similar manner it had reacted in the past oil shocks. Hypothesis There are multiple graphical presentations in existing literature that portray that inflation and oil prices follow the same trend line. This paper seeks to establish wh ether there is a strong correlation between changing oil prices and the selected macroeconomic indicators. It follows the first impression they give when one studies the graphical presentations. We state the following hypotheses to assist in finding a solution to the strength of the influence of oil price changes to the economy.Advertising We will write a custom research paper sample on Factors Affecting the Changes in Oil Price specifically for you for only $16.05 $11/page Learn More H0: There is no strong correlation between changes in oil prices and selected macroeconomic indicators. H1: There is a strong correlation between changes in oil prices and selected macroeconomic indicators. The hypotheses are derived from the perception that inflation rates respond quickly to oil supply shocks. When historical data is plotted on graphs, the trend lines indicate that key economic indicators follow the same trend as that of oil prices. However, some economic indicators tend to move in an opposite direction, such as real GDP and real interest rates. The periods of oil shocks have been followed by periods of recession. Proponents claim it is the U.S. government’s response that caused the recessions (Blinder Rudd, 2008). Opponents claim that the government’s response did not increase the intensity of the oil shocks. They blame the delayed policy in response to the oil shocks (Nelson, 2004). Policy makers can determine the level of intervention to similar oil shocks by finding the strength of the influence of changing oil prices to key economic indicators. A disproportionate application of policy may intensify the effects of oil price changes. Literature review and analysis of historical data Effects of the 1970s oil embargo and other oil shocks on the level of the GDP and employment. Oil prices are affected by the supply and demand of crude oil on the global market. In the 1970s, the supply of oil reduced when the OPEC coun tries reduced their oil production (Baffes et al., 2015). They also banned member states from selling oil to the U.S., and other countries that supported Israel in the Arab-Israel conflict.Advertising Looking for research paper on business economics? Let's see if we can help you! Get your first paper with 15% OFF Learn More It was labelled as OPEC I, which saw the oil prices quadruple within a short period (Blinder Rudd, 2008). OPEC II developed as a result of Iraq invading Iran in the late 1970s. At the time, the U.S. was more reliant on oil for energy than it is today. Figure 1, shown below, shows that a recession followed the periods of oil shocks. Figure 1 Data sources: World Bank (2015), BEA (2015), and EIA (2015a). Figure 1 shows that the real GDP annual growth rate and the trend of oil prices moved in opposite direction in the 1970s. According to the graph, there were recessions in 1970s, early 1980s, early 1990s, and towards 2010 (the 2008 financial crisis). The Real GDP dropped to touch the 0% growth rate line when the purchase price of oil increased. The percentage of those who were unemployed also increased side by side with the increase in oil prices (see Appendix A for tables). In the 1970s, the trend lines in the graph indicate that unemployment levels took similar turns as the trend li ne of oil prices. The graph also shows that the influence of the changes in oil prices weakened in the period that followed the mid 1990s. Annual oil consumption in the U.S. over the last four decades In the beginning of the study, we expected that the production of oil in the U.S. had increased while the consumption had declined. Figure 2 shows that the U.S. still needs to import crude oil. However, the size of oil import that needs to be imported has declined to levels that are similar to those in the mid 1970s and mid 1980s. By the end of 2013, oil production was on a steep upward trend. Figure 2 Data sources: EIA (2015b), and EIA (2015c) From Figure 2, it can be seen that oil production in 2013 rose above the level it was in the 1980s. The difference between oil production and consumption also approached zero, which indicates a reduced need to import crude oil (see Appendix A for tables). The reduced need to import reduces the demand for oil in the global oil market. It may als o result in a further strengthening of the dollar against foreign currencies, as it creates a less supply of ‘petrodollars’ to the global market. The effects of cost-push inflation and the phenomenon of stagflation arising from the oil shock of the 1970s Based on the graphs, there is a strong indication that inflation rates rose during periods of higher oil prices. Blinder Rudd (2008) discuss that the 1970s and 1980s experienced two periods of double-digit inflation rates, which were attributed to oil prices. Blinder Rudd (2008) mostly relied on trend lines to elaborate that the movement in oil shocks is similar to that derived from inflation rates. As it can be seen in Figure 3, inflation follows a similar trend to changes in oil prices. The periods with the highest inflation rate in the four decades include the 1973-1974 period and 1978-1980 period (Blinder Rudd, 2008). During the 1973-1974 period, inflation rate varied between 11.04% and 9.13%. During the 1978-198 0 period, it varied between 7.65% and 13.51% (World Bank, 2015, see Appendix A for tables). There is a strong indication that inflation rates are influenced by changes in oil prices. Inflation has never been higher than it was during the two periods over the forty-year period. Blinder Rudd (2008) link the high inflation rates in the early 1970s to the increase in food prices, oil prices, and the removal of price controls during Nixon’s administration. While higher food prices were linked to the shortage in food supply, it is visible that food prices are also affected by oil prices in the current oil supply shocks. Energy prices were the main source of inflation in the late 1970s (Blinder Rudd, 2008). Cashell Labonte (2008) explain that energy prices may affect the prices of other products because it is a key input in the production of many other products. Low inflation rate targets and low unemployment rates may be a challenging combination for policy makers (Nelson, 2004) . The 1970s’ economic condition was known as stagflation. It is a term used to describe rising inflation rates and high unemployment rates occurring at the same time. Cashell Labonte (2008) explain that the belief that policy makers had on Phillips curve made them experience a dilemma in dealing with rising inflation levels in the 1970s. The Phillips curve predicts that inflation will rise and unemployment will fall in an inverse relationship. An expansionary monetary policy increases demand, but it also stimulates inflation. The economy needs growth in demand to drive investment and economic growth. Nelson (2004) discusses that monetary policy was not viewed as an appropriate instrument to restore stability during the 1970s cost-push inflation. Cashell Labonte (2008) suggest that stagflation should not raise a lot of concern because the economy will return to its natural level of full employment, despite supply shocks. The periods of high oil prices are also known to be th e periods with the highest levels of inflation. However, in the last decade, the inflation rates appear not to respond with the same magnitude as the changes in oil prices. It may be an indication of an effective application of monetary and fiscal policies. In 2008, oil prices changed because of a decline in demand derived from the global recession. The increase in oil prices, after 2008, can be seen as a retraction of the lost upward trend. It may explain the reason for less volatility in inflation rates. In the last decade, there has been a decline in oil-intensity in energy production in the U.S. Figure 3 Data sources: BP (2015), EIA (2015a), and World Bank (2015) Figure 3 elaborates that the changes in the selected macroeconomic indicators do not match the volatility of oil price changes in magnitude. Nominal lending rates and inflation rates were more volatile to changes in the 1970s and 1980s than they have become in the last decade. The figure elaborates that real GDP growth rate reduced each time there was an increase in oil prices. It is only in 2008 that real GDP growth rate fell, despite a fall in oil prices. The growth rate of final consumption also declined in a similar manner. In the 1970s, it was expected that the reduction in employment levels would reduce the demand for oil. Reduction in demand would reduce the level of inflation (Blinder Rudd, 2008). Different views held that the rising oil prices only accounted for about a third of the inflation experienced in the U.S. (Blinder Rudd, 2008). Figure 3, shown above, may contribute to the argument because there is a big difference between the size of the percentage change in oil prices and the percentage change in key macroeconomic indicators. The main reason for the low impact in the U.S. is that local production cushioned against the effect of oil supply shocks. The price of oil increased four times in the global markets, but the refiners’ acquisition cost increased by about 100% in the U.S. (Blinder Rudd, 2008). In the future, as the economy turns to renewable energy alternatives, the effect of oil shocks may be reduced further. Some authors blamed the government for the delay in using monetary policy to reduce demand for oil (Nelson, 2004). Blinder Rudd (2008) discuss that the government should not be blamed because the inflationary pressures did not originate from its monetary policy. Historical data also shows that the supply of money almost declined during the period (Nelson, 2004). Cashell Labonte (2008) discuss a research carried out by Bernanke and other authors that indicates that policy responses may make the effects of oil shocks to have a larger impact on prices. The change in oil prices has a small impact on overall price levels when there is no intervention. The government is expected to overlook the effect of oil shocks when proposing policies. In response to Bernanke’s findings, some authors propose that it is unreasonable to withdraw economic policy when the economy is experiencing higher inflation levels (Cashell Labonte, 2008). Bernanke and his colleagues separated the effects of oil shocks on the economy using a simulated model. Opponents suggest that it is problematic to separate the effects of oil shocks from the effects of monetary policy in reality. It requires the government to respond, even when oil prices fall. One of the limitations of using a contractionary monetary policy to contain inflation is that reducing the U.S. demand will not affect the demand of other countries. However, the U.S. contributes a lot to global demand, reducing its demand would have an impact on reducing global demand. Another weakness of monetary policy is that there is a lag between application and effects, which may take time before they affect aggregate demand (Cashell Labonte, 2008). The 1978-1980 oil supply shocks lasted a shorter period. Using monetary policy, in trying to stabilize the economy, would have effects occu rring in a period they are not needed. It is more appealing to allow the short-term market shocks to be restored through the market mechanism, back to the equilibrium price. Oil prices have an impact on inflation when they are changing. Once they have adjusted and are stable, Cashell Labonte (2008) explain that it should not be of concern to policy makers. Higher oil prices have no effect on inflation, provided they are stable. Market forces will take the economy back to the natural rate of employment. The only challenge is that there are different levels of the natural rate of employment in different periods and countries. The Current Oil Prices Causes There are a number of periods in which oil prices have fallen since the 1970s. Oil prices fell in 1985, 1990, 1998, 2001, and 2008 (Baffes et al., 2015). In 2008, the fall in oil prices was associated with the fall in demand as the world economy sank into recession (McCafferty, 2015). In 1997-98, it was caused by the Asian economic crisis (Baffes et al., 2015). In all the oil shocks, the market was affected by either the supply of oil or its demand. The current sharp decline in oil prices is caused by increased supply. The other causes act through their effect on demand and supply. In the historical periods, one of the causes of the fall in oil prices has been an increase in production. In 2014, the fall in oil prices responded to a similar cause. Prior to the fall in prices, there was an increase in oil supply, followed by an accumulation of oil reserves. There has been an increase in production in the U.S. as shown in Figure 2. There has been an increase in oil supply since 2010 (McCafferty, 2015). In the global market, disruptions in supply only occurred in 2013 through the political instability in Libya and Iraq. The difference between the falling prices in 2014-2015 and other periods is that the supply has not been cut by OPEC as it has been happening in similar situations. Saudi Arabia used to play a cru cial role of reducing supply, which allows prices to stabilize. In the recent period, Saudi Arabia intends to push back firms that supply oil from high production cost rigs into cutting their supply. Baffes et al. (2015) discusses the point as a change in OPEC objectives. They have shifted from using oil prices to keep their market share to keeping their current production levels and relying on their competitiveness. Saudi Arabia holds the advantage of producing oil using one of the lowest costs in the global market. In the U.S., some drilling firms have postponed production in high production cost rigs (McCafferty, 2015). The current increase in oil supply may last a longer period than previous oil shocks because of the presence of new producing countries that want to capture a larger market share. Another reason is that the non-OPEC producers account for 58% of the global oil production, which may reduce the influence of OPEC. Baffes et al. (2015) predict that the lower oil prices will stabilize before the end of 2016. The high prices that followed the 2008 recession were one of the drivers of an increase in investment in oil production. McCafferty (2015) explains that the high oil prices made high production cost oil rigs to become economically viable. An increase in oil rigs caused the supply of oil to increase. The introduction of new technology in the U.S. for the extraction of oil and gas also increased supply in the U.S. In the 1980s, the venture into deep sea drilling and harsh climate environments caused an increase in supply in a similar manner (McCafferty, 2015). The U.S. shale oil production has been able to increase global production levels by about 1% annually since 2011. The demand for oil declined in the global market fell by about 0.8 million barrels per day while the U.S. oil supply increased by 0.9 million barrels per day (Baffes et al., 2015). It has resulted in increased supply and reduced demand. The appreciation of the U.S. dollar again st major currencies is cited as one of the contributing factors to falling oil prices. Baffes et al. (2015) explain that simulations indicate that a 10% appreciation in the USD will cut oil prices by between 3% and 10%. The impact of an appreciating USD is felt through a loss in purchasing power from countries that use the dollar to engage in international trade. Baffes et al. (2015) discuss that there was about a 10% appreciation of the USD in the last half of 2014, which may contribute to falling oil prices. A stronger dollar reduces the demand for oil in the global market through the loss of purchasing power. Effects The downward trend in oil prices may increase global economic growth in the next two years. According to the IMF, the recent fall in oil prices may result in the world economy growing by about 3.5% in 2015 and 3.7% in 2016 (McCafferty, 2015). Baffes et al. (2015) discuss that models have been used to estimate that a 30% decrease in oil prices will result in about 0.4 % to 0.9% decline in global inflation. Oil prices affect the economy through three channels, which include input costs, changes in real income, and the response of policy makers (Baffes et al., 2015). These channels directly and indirectly affect other economic indicators. In the UK, lower oil prices have been associated with a fall of inflation below targeted levels. In 2015, the inflation rate was 0.5% in January and 0.3% in February (McCafferty, 2015). Cheaper oil increases the purchasing power of workers through real wages. As the prices of other products fall, workers will be able to purchase more commodities using the same level of nominal income (McCafferty, 2015). It may increase aggregate demand, which will stimulate increased production. There are also negative effects of higher real wages. Blinder Rudd (2008) discuss that higher real wages relative to productivity will put pressure on wage rates and reduce employment demand. In the medium-term, high real wages will incre ase unemployment. In recent years, wages are considered to have absorbed most of the prices changes derived from oil shocks than it was in 1970s (Blinder Rudd, 2008). McCafferty (2015) supports the notion that lower oil prices does not translate into higher capital accumulation and higher productivity. Other factors have to be used to increase income levels. According to McCafferty (2015), there is a lack of a model that elaborates how to set interest rates in response to sharply falling oil prices. The lack of a clear level of interest rates may cause policy makers to avoid using interest rates in response to the current fall in oil prices. An inappropriate level of response may have adverse long-term effects on the economy. The study by Bernanke and co-authors gives a finding almost similar to the simulation by the Bank of England, which suggests that lower oil prices have a very small impact on the level of GDP (McCafferty, 2015). Bernanke and co-authors estimated that GDP would rise by 1.3% and inflation by 0.13% when oil prices rose by 10%, if there was no intervention from monetary policies (Cashell Labonte, 2008). The Bank of England estimated that a 10-percent fall in oil prices would increase the GDP by 0.1% in two years (McCafferty, 2015). These studies tend to indicate that the effect on oil prices on the GDP is minimal without the interference of government policies. Cashell Labonte (2008), as well as Blinder Rudd (2008), highlight the notion that the government’s effort in trying to control inflation from oil prices has been the source of recessions in the past. Previously, Figure 3 has shown that the effect of oil prices fluctuations on economic indicators was small and is becoming smaller. It shows that government intervention should be minimal in response to oil shocks. One of the reasons that the U.S. has become less sensitive to oil shocks is that the economy has become less oil-intensive than it was in the 1970s (Blinder Rudd, 20 08). The U.S. has also reduced its reliance on imported oil through the years. Figure 4, shown below, shows that the reliance on oil for energy production has reduced as a percentage of energy needs. Figure 4 Source of data: World Bank (2015) A less percentage of the U.S.’s energy consumption is derived from oil. Baffes et al. (2015) discuss that the impact of falling oil prices may have an impact of varying magnitude on different countries depending on the intensity of oil consumption in a country. In Asian countries, the fall in oil prices is weakening their currencies and causing an increase in capital outflows (Baffes et al., 2015). It is one of the ways oil shocks may affect financial markets. Policy in response The effect of the oil shocks has grown weaker in the last decade. According to Baffes et al. (2015), the effect of oil prices may end in 2016. Central banks do not need to respond to the fall in oil prices through a monetary policy because the phenomenon will be short-lived. However, in the European countries, the rate of inflation was maintained at low levels, an expansionary monetary policy may be needed to maintain inflation closer to the targeted levels. Disinflation may not be preferred. In countries such as Egypt, the lower oil prices provide countries, which usually support oil consumption through subsidies, to withdraw subsidies if it is part of their long-term goals (Baffes et al., 2015). In response to lower oil prices, the U.S. does not need to respond with a cut in the government expenditure. Methodology Explanation of theoretical model The paper starts with an examination of the literature review of the causes and effects of oil shocks to the economy. There was examination of policies in response to changes in oil prices. In line with existing literature, the paper has used graphs for analysis. The graphs were developed from historical data, which covers four decades on economic indicators. Percentages are used for most indica tors because they allow a better comparison of effects than the use of absolute values. Spearman’s rank correlation has been applied in trying to find out whether there is a strong association between oil prices and other macroeconomic indicators. One of the reasons for applying the rank correlation is that the curves are non-linear. There is the presence of outliers. Rank correlation has been used by Blinder Rudd (2008) to analyze the effects of oil shocks to the U.S. economy. Pearson product moment correlation has been used by Baffes et al. (2015) in describing the association between changes in oil prices and macroeconomic indicators. In this paper, the product moment correlation has been used to compare results from the rank correlation. Correlation is preferred because it is difficult to separate the effects of oil shocks from the effects of government policy. Baffes et al. (2015) analyze trends in oil prices using correlation and finds out that only the core inflation rate may have a negative correlation with oil prices. Inflation derived from the CPI should have a positive correlation with changes in oil prices. In line with the literature review, changes in oil prices should be used instead of oil prices to assess their impact on the economy. The results show that using absolute values in oil prices results in findings that are contradictory to existing literature. Statistical analysis In the results, the Spearman’s rank correlation indicates that there is a weak positive correlation between inflation and changes in oil prices over the forty-year period. However, the Pearson product moment correlation indicates that there is a strong relationship between changes in oil prices and the inflation rate. The results conform with existing studies that inflation responds to changes in oil prices rather than higher oil prices. Cashell Labonte (2008) and Baffes et al. (2015) suggest that once prices have stabilized, high oil prices have no impac t on inflation. Table 1 There are a few reasons for contradictory results when absolute prices are used. The reason for negative correlation is evident from the fact that the forty-year period is a long period, the highest inflation rates are in the 1970s and the highest oil prices appear after 2009. It causes the rank correlation to be negative. Another reason for the negative correlation is the nominal oil prices. Result would be different if oil prices were chained to a base year. There is an accumulative inflation rate that makes oil prices in recent years higher than in the 1970s. The result leads to the acceptance of the null hypothesis (H0) that there is no strong association between changes in oil prices and selected macroeconomic indicators. However, inflation rates show a strong positive correlation with changes in oil prices under the Pearson product moment correlation. There is a weak negative correlation between changes in oil prices and real GDP growth rate, final con sumption, and real interest rates. Changes in oil prices have a weak positive correlation with nominal lending rates. Data collection Data used in the paper was collected from government agencies’ databases and corporate databases. The World Bank (2015) database provided a large group of data, in Excel format, from which data on real GDP growth rate, nominal lending rates, real interest rates, inflation rates, and annual growth rate of final consumption was obtained. The EIA (2015a) provided data on the first purchase price of crude oil from 1970 to 2014. The EIA (2015b) and EIA (2015c) provided data on consumption and production of oil from 1980 to 2013. The BP (2015) database filled the gap by providing data for oil production and consumption from 1970 to 1979. There was a negligible difference between data provided by EIA and BP databases on oil production and consumption. The BP database worksheet also included data on oil prices, though it was not used in the analysis. P reference was given to the EIA historical data on oil prices. BEA (2015) provided data on the level of GDP. Conclusion Summary of the results There is a weak relationship between changes in oil prices and key economic indicators. The weak correlation may be explained by the reduced impact of oil shocks in the last decade. In 2008 recession, changes in oil prices and changes in key economic indicators moved in a different direction than it was expected. The effect is also reduced by the fact that the government has implemented policies that keep the nominal interest rates at a fixed lower level. It has also used an expansionary monetary policy that may overshadow the effects of increasing oil prices since 2009. Existing theories indicate that only about a third of the effect of changing oil prices may be reflected on the macroeconomic indicators. One of the limitations of the study is that it is difficult to separate the effects of changing oil prices from the effect of government po licy using historical data. They are applied simultaneously and the effects are spread across different macroeconomic indicators, which have a second-wave of effects. As a matter of fact, the correlation results only measure the extent to which macroeconomic indicators have a similar trend to changes in oil prices. Inflation rate is the macroeconomic indicator that appears to be greatly influenced by changes in oil prices. Recommendations Policy makers do not need to respond to current changes in oil prices. One of the reasons is that the falling oil prices are expected to stabilize by the end of 2016. It makes the oil shock to be considered a short-term phenomenon. Monetary policy has time lags between application and effect, which may cause an unwanted effect in the long run. The literature review indicates that government policies may intensify the effect of an oil shock. It is an opportunity to implement fiscal policies that cut expenditure on oil subsidies in countries that re lied on them. The contraction of fiscal policy should only be used when it is regarded as a long-term objective. The fall in oil prices may be followed by an increase in unemployment when there are higher real wages relative to productivity (Blinder Rudd, 2008). It may cause a decline in the demand for labor. The government can ease its monetary policy by a small margin to contain rising real wages. It should be done in a timely manner to prevent the lagging effects. References Baffes, J., Kose, A., Ohnsorge, F., Stocker, M., Chen, D., Cosic, D., Gong, X., Huidrom, R., Vashakmadze, E., Zhang, J., Zhao, T. (2015, January). Understanding the plunge in oil prices: Sources and implications. Global Economic Prospects. Retrieved from http://www.worldbank.org/content/dam/Worldbank/GEP/GEP2015a/pdfs/GEP201 5a_chapter4_report_oil.pdf BEA. (2015). National data: gross domestic product. Retrieved from www.bea.gov/national/xls/gdplev.xls Blinder, A., Rudd, J. (2008). The supply shock explan ation of the great stagflation revisited. Retrieved from http://www.princeton.edu/ceps/workingpapers/176blinder.pdf BP. (2015). BP statistical review of world energy June 2013. Retrieved from http://www.bp.com/statisticalreview Cashell, B., Labonte, M. (2008). Understanding stagflation and the risk of its recurrence. Retrieved from http://assets.opencrs.com/rpts/RL34428_20080331.pdf EIA. (2015a). Petroleum and other liquids: U.S. crude oil first purchase price (dollars per barrel). Retrieved from http://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PETs=F000000__3f=A EIA. (2015b). Total petroleum consumption. Retrieved from http://www.eia.gov/cfapps/ipdbproject/iedindex3.cfm?tid=5pid=5aid=2cid=r1, syid=1980eyid=2013unit=TBPD EIA. (2015c). Total petroleum consumption. Retrieved from http://www.eia.gov/cfapps/ipdbproject/iedindex3.cfm?tid=5pid=5aid=2cid=r1, syid=1980eyid=2013unit=TBPD McCafferty, I. (2015). Oil price falls – what consequences for monetary policy? Retrieved from http://www.bankofengland.co.uk/publications/Documents/speeches/2015/speech 806.pdf Nelson, E. (2004). The great inflation of the seventies: What really happened? Retrieved from https://research.stlouisfed.org/wp/2004/2004-001.pdf World Bank. (2015). United States: World development indicators. Retrieved from http://data.worldbank.org/country/united-states This research paper on Factors Affecting the Changes in Oil Price was written and submitted by user Charity Beasley to help you with your own studies. You are free to use it for research and reference purposes in order to write your own paper; however, you must cite it accordingly. You can donate your paper here.

United States Transforming International Institutions

United States Transforming International Institutions United States Transforming International Institutions On thÐ µ onÐ µ hand, thÐ µ US has bÐ µÃ µn thÐ µ grÐ µatÐ µst champion in transforming intÐ µrnational institutions in thÐ µ twÐ µntiÐ µth cÐ µntury, urging on thÐ µ world various sorts of nÐ µw organizational crÐ µations. On thÐ µ othÐ µr hand, AmÐ µrica has also tÐ µndÐ µd to rÐ µsist tying itsÐ µlf in institutional commitmÐ µnts and obligations. Across thÐ µ cÐ µnturyand in particular at thÐ µ major post-war turning points of 1919, 1945, and 1989thÐ µ UnitÐ µd StatÐ µs pursuÐ µd ambitious stratÐ µgiÐ µs that includÐ µd thÐ µ usÐ µ of a rangÐ µ of tools to rÐ µmakÐ µ intÐ µrnational ordÐ µr. No othÐ µr country has advancÐ µd such far-rÐ µaching and Ð µlaboratÐ µ idÐ µas about how institutions might bÐ µ Ð µmployÐ µd to organizÐ µ and managÐ µ thÐ µ rÐ µlations bÐ µtwÐ µÃ µn statÐ µs. But dÐ µspitÐ µ this Ð µnthusiasm for crÐ µating institutions and a rulÐ µ-basÐ µd intÐ µrnational ordÐ µr, thÐ µ UnitÐ µd StatÐ µs bÐ µÃ µn rÐ µluctant to connÐ µct itsÐ µlf to thÐ µsÐ µ institutions and rulÐ µs. An obvious hypothÐ µsis is that thÐ µ UnitÐ µd StatÐ µs organizÐ µs and opÐ µratÐ µs within intÐ µrnational institutions whÐ µn it can dominatÐ µ thÐ µm and rÐ µsists doing so whÐ µn it cannot. But a slightly morÐ µ complÐ µx sÐ µt of calculations sÐ µÃ µm to bÐ µ involvÐ µd. This papÐ µr, by rÐ µfÐ µrring to thÐ µ concÐ µpts analyzÐ µd by Brooks and Wohlforth (2009), arguÐ µs that AmÐ µrica should activÐ µly strÐ µngthÐ µn and promotÐ µ its position in transforming intÐ µrnational institutions and variations in its institutional rÐ µlations with Ð µuropÐ µ in ordÐ µr to sÐ µcurÐ µ its influÐ µncÐ µ on thÐ µ global lÐ µvÐ µl (Durch, 2003). ThÐ µ attraction of institutional agrÐ µÃ µmÐ µnts for AmÐ µrica is that it potÐ µntially locks othÐ µr statÐ µs into stablÐ µ and prÐ µdictablÐ µ policy oriÐ µntations, thÐ µrÐ µby rÐ µducing its nÐ µÃ µd to usÐ µ forcÐ µ. But thÐ µ pricÐ µ that thÐ µ UnitÐ µd StatÐ µs must pay for this institutionalizÐ µd coopÐ µration is a rÐ µduction in its own policy autonomy and its rÐ µducÐ µd ability to Ð µxÐ µrcisÐ µ powÐ µr. ThÐ µ cÐ µntral quÐ µstion that AmÐ µrican policy-makÐ µrs havÐ µ confrontÐ µd ovÐ µr thÐ µ dÐ µcadÐ µs aftÐ µr 1945 in rÐ µgard to its Ð µconomic and sÐ µcurity tiÐ µs with Ð µuropÐ µ, and Ð µlsÐ µwhÐ µrÐ µ around thÐ µ world as wÐ µll, is: how much policy lock is worth rÐ µduction in AmÐ µrican policy autonomy and rÐ µstraints on its powÐ µr? ThÐ µ answÐ µr liÐ µs in thÐ µ hÐ µart of thÐ µ concÐ µpt that institutional agrÐ µÃ µmÐ µnts can lock othÐ µr statÐ µs into a rÐ µlativÐ µly stablÐ µ ordÐ µr (RÐ µisman, 2000). ThÐ µ institutions hÐ µlp crÐ µatÐ µ a morÐ µ favorablÐ µ and cÐ µrtain political Ð µnvironmÐ µnt in which thÐ µ lÐ µading statÐ µ pursuÐ µs its intÐ µrÐ µsts. This is possiblÐ µ bÐ µcausÐ µ institutions can opÐ µratÐ µ as mÐ µchanisms of political control. WhÐ µn a statÐ µ agrÐ µÃ µs to tiÐ µ itsÐ µlf to thÐ µ commitmÐ µnts and obligations of an intÐ µr-statÐ µ institution, it is agrÐ µÃ µing to rÐ µducÐ µ its policy autonomy. A lÐ µading statÐ µ that has crÐ µatÐ µd an institutionalizÐ µd ordÐ µr that works to its long-tÐ µrm bÐ µnÐ µfit is bÐ µttÐ µr off than a lÐ µading statÐ µ opÐ µrating in a frÐ µÃ µ-floating ordÐ µr rÐ µquiring thÐ µ constant and costly Ð µxÐ µrcisÐ µ of powÐ µr to gÐ µt its way (RÐ µisman, 2000). Institutions can sÐ µrvÐ µ at lÐ µast two purposÐ µs in intÐ µrnational rÐ µlations. First, as somÐ µ critics arguÐ µ, institutions can hÐ µlp solvÐ µ intÐ µrnational problÐ µms by rÐ µducing thÐ µ commitmÐ µnt problÐ µms and transaction costs that stand in thÐ µ way of Ð µfficiÐ µnt and mutually bÐ µnÐ µficial political Ð µxchangÐ µ (Litan, 2000). But institutions arÐ µ also instrumÐ µnts of political control. As TÐ µrry MoÐ µ (1990, p. 213) arguÐ µs, political institutions arÐ µ also wÐ µapons of coÐ µrcion and rÐ µdistribution. ThÐ µy arÐ µ thÐ µ structural mÐ µans by which political winnÐ µrs pursuÐ µ thÐ µir own intÐ µrÐ µsts, oftÐ µn at thÐ µ Ð µxpÐ µnsÐ µ of political losÐ µrs. A winning political party in CongrÐ µss will try to writÐ µ thÐ µ committÐ µÃ µ voting rulÐ µs to favor its intÐ µrÐ µsts. Similarly, in intÐ µrnational rÐ µlations, a powÐ µrful statÐ µ will want to makÐ µ its advantagÐ µs as systÐ µmatic an d durablÐ µ as possiblÐ µ by trying to tiÐ µ wÐ µakÐ µr statÐ µs into favorablÐ µ institutional arrangÐ µmÐ µnts (OstrowÐ µr, 1998). ThÐ µ attraction of institutional agrÐ µÃ µmÐ µnts for thÐ µ UnitÐ µd StatÐ µs is twofold. First, if AmÐ µrica can gÐ µt othÐ µr statÐ µs to tiÐ µ thÐ µmsÐ µlvÐ µs to a multilatÐ µral institution that dirÐ µctly or indirÐ µctly sÐ µrvÐ µs its long-tÐ µrm intÐ µrÐ µsts, it will not nÐ µÃ µd to spÐ µnd its rÐ µsourcÐ µs to constantly forcÐ µ othÐ µr statÐ µs. It is thÐ µ most powÐ µrful statÐ µ, hÐ µncÐ µ, it is likÐ µly that it would win many or most of thÐ µ Ð µndlÐ µss distributivÐ µ battlÐ µs with subordinatÐ µ statÐ µs, but locking thÐ µsÐ µ lÐ µssÐ µr statÐ µs into institutional agrÐ µÃ µmÐ µnts rÐ µducÐ µs thÐ µsÐ µ costs of Ð µnforcÐ µmÐ µnt (Litan, 2000). SÐ µcond, if thÐ µ institutional agrÐ µÃ µmÐ µnt has somÐ µ dÐ µgrÐ µÃ µ of connÐ µction, thÐ µ institution may continuÐ µ to providÐ µ favorablÐ µ outcomÐ µs for thÐ µ lÐ µading statÐ µ Ð µvÐ µn aftÐ µr its powÐ µr capacitiÐ µs havÐ µ dÐ µcli nÐ µd in rÐ µlativÐ µ tÐ µrms. Institutions can both consÐ µrvÐ µ and prolong thÐ µ powÐ µr advantagÐ µs of thÐ µ lÐ µading statÐ µ (Litan, 2000). But why would wÐ µakÐ µr statÐ µs agrÐ µÃ µ to bÐ µ tiÐ µd in? WÐ µakÐ µr statÐ µs havÐ µ two potÐ µntial incÐ µntivÐ µs to buy into thÐ µ lÐ µading statÐ µ's institutional agrÐ µÃ µmÐ µnt. First, if thÐ µ institutional agrÐ µÃ µmÐ µnt also puts limits and rÐ µstraints on thÐ µ bÐ µhavior of thÐ µ lÐ µading statÐ µ, this would bÐ µ wÐ µlcomÐ µ. In intÐ µrnational rÐ µlationships, thÐ µsÐ µ lÐ µssÐ µr statÐ µs arÐ µ subjÐ µct to thÐ µ unrÐ µstrainÐ µd and unprÐ µdictablÐ µ domination of thÐ µ lÐ µading statÐ µ. If thÐ µy bÐ µliÐ µvÐ µd that crÐ µdiblÐ µ limits could bÐ µ placÐ µd on thÐ µ indiscriminatÐ µ actions of thÐ µ lÐ µading statÐ µ, this might bÐ µ Ð µnough of an attraction to justify an institutional agrÐ µÃ µmÐ µnt. SÐ µcond, whÐ µn thÐ µ lÐ µading statÐ µ doÐ µs in fact control its bÐ µhavior it is giving up somÐ µ opportunitiÐ µs to usÐ µ its powÐ µr to gain immÐ µdiatÐ µ rÐ µturns on its pow Ð µr (Durch, 2003). At thÐ µ samÐ µ timÐ µ, wÐ µakÐ µr statÐ µs may havÐ µ rÐ µason to gain soonÐ µr rathÐ µr than latÐ µr. ThÐ µ discount ratÐ µ for futurÐ µ gains is potÐ µntially diffÐ µrÐ µnt for thÐ µ lÐ µading and thÐ µ lÐ µssÐ µr statÐ µs, and this makÐ µs an institutional bargain potÐ µntially morÐ µ mutually dÐ µsirablÐ µ. SÐ µvÐ µral hypothÐ µsÐ µs follow immÐ µdiatÐ µly from this modÐ µl of statÐ µ powÐ µr and institutions. First, AmÐ µrica should try to lock othÐ µr statÐ µs into institutionalizÐ µd policy oriÐ µntations whilÐ µ trying to minimizÐ µ its own limitations on policy autonomy and discrÐ µtionary powÐ µr (Durch, 2003). In othÐ µr words, Ð µach individual within a complÐ µx organizational hiÐ µrarchy is continually Ð µngagÐ µd in a dual strugglÐ µ: to tiÐ µ his collÐ µaguÐ µs to prÐ µcisÐ µ rulÐ µ-basÐ µd bÐ µhavior, thÐ µrÐ µby crÐ µating a morÐ µ stablÐ µ and cÐ µrtain Ð µnvironmÐ µnt in which to opÐ µratÐ µ, whilÐ µ also trying to rÐ µtain as much autonomy and discrÐ µtion as possiblÐ µ for himsÐ µlf (OstrowÐ µr, 1998, p. 67). Similarly, lÐ µading statÐ µs will try to lock othÐ µr statÐ µs in as much as possiblÐ µ whilÐ µ also trying to rÐ µmain as dÐ µtachÐ µd as possiblÐ µ from institutional rulÐ µs and obligations. SÐ µcond , thÐ µ lÐ µading statÐ µ will makÐ µ usÐ µ of its ability to limit its capacity to Ð µxÐ µrcisÐ µ powÐ µr in indiscriminatÐ µ and arbitrary ways as mÐ µans to buy thÐ µ institutional coopÐ µration of othÐ µr statÐ µs. TakÐ µn togÐ µthÐ µr, thÐ µsÐ µ considÐ µrations allow onÐ µ to sÐ µÃ µ how AmÐ µrica and wÐ µakÐ µr statÐ µs might makÐ µ tradÐ µ-offs about binding thÐ µmsÐ µlvÐ µs togÐ µthÐ µr through intÐ µrnational institutions. ThÐ µ morÐ µ thÐ µ lÐ µading statÐ µ is capablÐ µ of dominating and abandoning wÐ µakÐ µr statÐ µs, thÐ µ morÐ µ wÐ µakÐ µr statÐ µs will carÐ µ about rÐ µstraints on thÐ µ lÐ µading statÐ µ's Ð µxÐ µrcisÐ µ of powÐ µr. Similarly, thÐ µ morÐ µ a potÐ µntially dominating statÐ µ can in fact crÐ µdibly rÐ µstrain and commit itsÐ µlf, thÐ µ morÐ µ wÐ µakÐ µr statÐ µs will bÐ µ intÐ µrÐ µstÐ µd in pursuing an institutional bargain. WhÐ µn both thÐ µsÐ µ conditions hold, AmÐ µrica will bÐ µ particularly willing and ablÐ µ to pursuÐ µ an institutional bargain.

Pick one all info is there Essay Example | Topics and Well Written Essays - 1000 words

Pick one all info is there - Essay Example They feel oppressed, disconnected, machine-like, and very much out of control with being forced to perform in some manner in order to regain those freedoms. How can this be? First of all, in order to determine what freedom is and what it isn't, we must clarify and accept the definition of the word freedom. The Free Dictionary defines freedom as the condition of being free from restraints. It also includes political independence, lack of slavery, detention or oppression, exemption from authority in performing a certain task or action, liberty, exemption from an onerous or unpleasant condition, the ability to choose for oneself, and move about without restriction, lack of reserve or modesty, full access, all the rights of citizenship or membership, and the power to perform certain actions without interference or control. This is a very broad definition containing many implications and directions for freedom to go. II. Point One By considering freedom in the broadest of terms, it's easy to see how one may think it would be the most wonderful concept on the planet; everyone should be free. Life would have the greatest meaning for the largest number of people if only there was more freedom. The suffering and oppression of Third World countries would be alleviated and more people would rise from the ashes to take their places if only there was more freedom in the world. All people would be free to live a life of their own choosing; finding success and peace within themselves, lacking nothing of comfort and convenience necessary for daily living. While this may be a very broad goal, not easily attainable; it is neither logical nor practical. The systems created to serve life on planet Earth cannot operate within this framework. Most economic systems require there to be supply and demand; which also requires there to be people who consume as well as those who produce. This, in turn, requires there to be managers, as well as workers have no ability to move around withou t restrictions or to perform certain actions without interference or control; the haves and the have nots. III. Point Two Perhaps freedom just means freedom from an onerous and unpleasant condition. Well, if that were the case, then freedom from hunger, pain, illness, or even a bad relationship or boring career would bring immediate relief for millions of people across the globe. Yet, the systems they were born into dictate for them what they’re entitled to for daily living; including the choice to marry and with whom they will marry, what career they will have, if they will work, and who they will work for. Maybe political independence is necessary in order to remove the suffering from the world. By gaining full access to all the rights of citizenship within a geographical area, having the power to move around with exemption of authority as well as the ability to make decisions without interference or control would create a world where all the needs of the people are met and the human family is happy and satisfied. As long as there is only one person in this utopian society, things would be fine. The problem exists when people, who are uniquely different in their growth and development, as well as in their needs, beyond the basics, try to live together in small spaces, called communities. Then, the concept of freedom becomes moderately distorted. My freedom

Transition Economy of Brazil Research Paper Example | Topics and Well Written Essays - 2250 words

Transition Economy of Brazil - Research Paper Example The success story of Hungary, Russia, Poland and China shows that former communist countries can create growth from the ruins and limitations of socialism. In Poland, a decentralized and comprehensive approach to the twin problems of bank and enterprise restructuring proved effective in transforming its economy and establishing the foundations for sustained economic growth. During the 1991-97 period, nonperforming loans declined and the number of creditworthy enterprises rose substantially. As for Russia, the largest post-communist transition economy of them all, it endeavored to establish strong fiscal and monetary controls as its bedrock of macroeconomic stability. These served as levers to check imbalances in public sector financing. Russia learned its lesson well from an earlier financial crisis when the unwieldy growth of soft loans skewed its market (Dunn, 2006). The non-collateralized loans had been liberally granted to state-owned enterprises that could not afford to pay them back. All the transition economies realized early the importance of privatization to dismantle the state monopolies that characterized the former communist countries. In Brazil, vital industries and services like oil, gas, telecommunications and postal service used to be under state monopolies. A series of constitutional amendments were taken up in 1995 and 1996 to do away with the distinctions in nationalized and foreign companies, thus effectively lifting the government stranglehold on these industries.

‘Fair Dealing’ Defences in UK Copyright Law: An Analysis

‘Fair Dealing’ Defences in UK Copyright Law: An Analysis â€Å"The ‘fair dealing’ defences occupy a pivotal position in copyright law. They ensure a balance between the interest of the copyright owner in securing a just return on creative work and the public interest in ensuring that intellectual property does not impede the flow of ideas and information.† J Griffiths Preserving Judicial Freedom of Movement –Interpreting Fair Dealing In Copyright Law IPQ 2000, 2,2 164-186. To what extent do you consider that the fair dealing provisions and the supporting case law provide a desirable and consistent balance between these interests? This paper will criticize the restrictive approach of ‘fair dealing’ defences in UK copyright law. American copyright law will be examined in comparison to discuss the alternative attitudes towards ‘fair dealing’ defences in infringement disputes. Changes to the rule will be proposed and discussed to demonstrate how the current copyright defence can be improved to maintain the balance of protecting intellectual property and freedom of information. Fair Dealing defences which are used against copyright infringement cases raise important philosophical issues at the heart of Intellectual Property. There is a need for society to share and build on existing knowledge for progress. For example it can be argued the need to allow freedom of expression, is ‘more than necessary to incentivise creative expression in the first place.’[1] Fair dealing defences attempt to mediate between the fine line of the commercial proprietary rights granted through copyright and the legitimate public use of material in good faith, to teach, educate and share cultural works. Thus there is a fundamental dichotomy between the free expression of ideas in the public domain and the rightful protection of creative works which use such knowledge and information. This is termed the ‘idea-expression divide.’[2] Kretschmer [3] argues against the concept of copyright, due to its capacity to act as an ‘artificial barrier’[4] i mpeding the exchange of ideas in society. One explanation behind such divisions can be suggested to lie in the historical Lockean conceptualization of property. This is defined negatively creating ‘rights to exclude access.’[5] This ‘absolutist conception of property rights’[6] allows the creators to exploit and monopolize economic, cultural production at the expense of fair uses in the public interest and freedom of expression. But there are those who support the rights of the author. For example the French system of droit d’auteur enables an artist to control how their work is distributed in the market. While concerned about economic exploitation of work, moral rights also ensure the author has rights to protect the integrity of a work. Thus the British concept of fair dealing defences must balance these conflicting tensions. British copyright law protects the manner of expression or form of the idea, not the idea itself. A book can be protected but not the actual underlying ideas and themes conveyed in the written text. This was stated in the case of Donoghue[7] where the judge held ‘the person who has clothed the idea in form, whether by means of a picture, a play or book’ will enjoy the benefits of copyright protection. Fair Dealing in UK copyright law is a defence under Sections 28-76 of the CDPA 1988[8]. The legislation provides for a set of prescribed circumstances, where reproductions of copyright material will not be considered an infringement. Fair dealing is outlined in sections 20-30. There are three categories where copying can be considered a fair action to take when using copyright protected material. They are 1) for research and private study under section 29; 2) for criticism and review in section 30; and 3) reporting current events under section 31. It must be noted that the legislation provides no clear definition of what constitutes fair use of material which attracts copyright. Thus the act restricts the defence to the non exclusive purposes as stated above. One reason for restricting fair use to a number of permitted acts enables the judge to consider other factors which are unique to the case itself. Fair dealing in this sense is shaped in the UK by judges as a ‘matter of im pression’[9] on a case by case basis. The scope of fair dealing was clarified by Lord Denning in Hubbard v. Vosper. [10] This case suggested certain criteria to be considered by the judge in order to determine whether fair use can be permitted in different situations involving the use of copyrighted material. Denning outlined considerations, such as the frequency and extent of quotations, and subsequently the nature of using quotations. Denning states in response to this test, ‘If they are used as a basis of comment, criticism or review that may be fair dealing. If they are used to convey the same information for a rival purpose, they may be unfair.’ Another rule of thumb is the extent of the quotation within copyrighted work. This considers the size of the actual quote used and its justified proportions in fair use. For example Denning suggests ‘to take long extracts and attach short commentary maybe unfair.’ Each case of infringement is judged by objective standards, through the eyes of an hon est person as to whether they would have dealt with the protected material in the same way as the infringer has acted. Existing fair dealing case law, only serves to highlight the ambiguity of the defence under English law. It is difficult to provide a desirable balance which protects the exclusive rights of the copyright holder but maintain a consistent approach which provides certainty to use material which is permitted in law. For example the purposes of legitimate research, the courts will not allow commercial research if it is used to produce a competing product or work. This was highlighted in the case of Time Out.[11] It can be suggested large amounts of copying will be allowed for private research and study in the eyes of the law. Academics argue in this context fair dealing functions to enable freedom of individual research and study. To require and enforce protective measures to prevent the use of copyrighted material is impractical and uneconomic. It is argued copyright should not be used as a bar to those who wish to use the work in their own studies. Torremans argues copyright property rhetoric should not be allowed to supersede important value of free ideas. For example ‘copyright should not become a financial and practical obstructing barrier. There needs to be a balance between the interests of the copyright owners and society in the good functioning of the copyright system and the inter est of society for its development.’[12] It can be suggested this same line of reasoning underpins the fair dealing doctrine for educational purposes. Copying is permitted for intellectual property in dramatic, literary, artistic or musical work for purposes of instruction. Thus a student would be allowed to copy a part of an academic article in order to support their research or point of view in an essay. Under the category of infringing material for the purposes of criticism and review, it has been established that infringement will not occur if there is adequate acknowledgement of the author, the title or description of work is made available, as held in the case of Sillitoe.[13] Fair dealing was extended in the case of Pro Sieben Media AG [14] which held criticism of work can be fair, even if including the ideas in a work to discuss its ethical implications. The case stated that the ‘defence is limited to criticizing or reviewing that or another work or a performance of a work.’ The function of the defence is to allow a critic a sensible degree of leeway to conduct a review of the work. The courts stated the use of infringing material in a documentary was ‘a genuine piece of criticism and review rather than an attempt to dress ordinary copyright infringement up as criticism.’[15] This case suggests it is fair to critically treat copyrighted material using the ideas within the work. But crucially ‘the defence does not cover those cases where only ideas, doctrine, philosophy and events are criticized.’ [16] Therefore the fair dealing doctrine is narrow in scope, restricted only to the fair use for the purposes of critical review. This case been criticized by Torremans who has argued it is not sufficient to rely on the infringers ‘sincere belief’ they are conducting fair criticism. There is an imbalance for those to wishing to exploit the fine line and cynically infringe work and simply claim the fair dealing defence for the purpose of criticism and review. It can be suggested in comparison to US legal ‘multi – purpose’[17] concept of fair use, the UK fair dealing doctrine is too restrictive in scope and interpretation. The UK is restrictive because the CDPA legislates three categories of permitted copying under the fair dealing defences, which are determined on a case by case basis of the judge. Thus anything else will be uncovered by the doctrine. The American legal system in contrast uses four standard ‘balancing’[18] tests to determine the extent of copying protected material which is covered under the fair use doctrine. The fair use doctrine is a wider and more flexible legal concept to balance the ‘idea-expression’ division in intellectual property. Under the American Copyright Act 1976 17 U.S.C Section 107 states: ‘In determining whether the use made of a work in any particular case is a fair use the factors to be considered shall include- 1.the purpose and character of the use, including whether such use is of a commercial nature or it is for non profit educational purposes; 2.the nature of the copyrighted work; 3.the amount and substantiality of the portion used in relation to the copyrighted work as a whole, and 4.the effect of the use upon the potential market for or value of the copyrighted work.’ The fair use doctrine is not defined within the statute, it is left open to broad interpretation by judicial opinion. This ensures a degree of flexibility for the continued transmission of ideas in society. This for example can be seen when analyzing the primary factor of purpose and character. The concept of fair use rests on the idea of limited ‘transformative use’[19] for similar purposes of educating, parody or comment. The standard allows the courts to asses whether the use is fair and justified. It also requires the burden of proof on the infringer to ‘demonstrate how the consideration is the extent to which the use is interpreted as transformative as opposed to merely derivative.’[20] This point of law was considered in cases such as Mattel Inc.[21] The toy company lost the claim against an artist who parodied the iconic â€Å"Barbie† doll figure in a non derivative manner. The doll was used in an entirely different context which defeated the c opyright infringement claim. Secondly the benefits of American fair use can be seen when considering the nature of the work. The standard allows for the distinction between created work and factual information which serves the public through its dissemination into the open arena. It is argued there is more ‘leeway’[22] to copy factual material. This provision directly allows the courts to ‘prevent the private ownership of work that rightfully belongs in the public domain, as facts and ideas are separate from copyright.’[23] This was held to be the case in Time Inc [24]concerning the public interest of the film depicting the assignation of President Kennedy. The social need to keep this in the public domain was greater than the commercial need to uphold the copyright in the film footage. The third factor assessing the amount and substantiality of the original copied work is a more troublesome standard to determine in the courts. For example the issue of sampling in hip hop music, which reclaims existing music and uses it to create a new track, was litigated. Here the courts have been unusually strict seen in the decision Grand.[25] The case enforced the copyright of a Gilbert O’Sullivan song and lead to the restrictive requirement of licensing samples of music from the copyright owner, if the sample if substantially recognizable. The fourth factor of investigating the effect upon the work’s value attempts to quantify the commercial impact infringement has had on the protected material. The ‘Betamax’[26] case involved the copyright owner Universal loosing the infringement claim as it could not prove with any reliable evidence that the Betamax technology had dented the commercial broadcaster’s profits. Such an approach allows the courts to factor in alleged market harm to copyrighted material, and give equal consideration to economic concerns of the rights holder to make a fully informed assessment of the situation. These four non exclusive factors provide enough flexibility for judicial opinion to consider other important considerations in relation to each individual case of infringement. In addition flexibility is encouraged as the fair use doctrine is a positive ‘defense to copyright, which means if the defendants actions do not constitute and infringements of the plaintiffs rights, fair use does not even arise as an issue.’[27] Thus a broader view is established in the US system. You do not need the consent of the copyright owner under American law to engage in fair use of material which attracts copyright. However further criticism of the UK approach to fair dealing arises in the wider context of digital copying technology and file sharing. The doctrine is made to look ineffective, mainly through the botched nature of the UK implementation of the EU Directives on the Information Society. This paper believes it is necessary to resolve these problems and rethink the traditional approach to copyright infringement in a digital environment. The aim to balance the conflicting factors of the author’s rights and the need to allow the free exchange of knowledge in society is harder to perform with widespread digital copying. But it is possible through Digital Management Systems, to distribute copyrighted content through technology which limits the capacity to duplicate files by the consumer. Despite DMS, this paper believes the frequency and simplicity of replication facilitated through digital technology far outweighs such content managed systems that use inbuilt licensing restrictions. For example peer 2 peer file sharing and online digital content has facilitated the exchange of copyrighted music in huge numbers among users of a globalised network on the internet. It can be suggested that the UK’s implementation of the EU Information and Society Directive (2001) shows how outdated the present conception of fair dealing defences are. Article 5 deals with the exceptions and limitations to the use of copyright, in order to harmonize European policy. Under Article 5(5) a ‘draconian’[28] three step test is used to assess any infringement exceptions in special cases. This section is to be ‘applied if they do not conflict with normal exploitation of the work and if the exception does not unreasonably prejudice the legitimate interests of the rights holder.’[29]Critics suggest this is an even stricter standard providing no fair use for ‘copy protected on demand services.’[30] Critics view the directive to mistakenly allow principles of freedom of expression to be ‘handed over to the rights owner.’[31] For example under article 6(4) availability of research material through on-demand services c an be contractually blocked by the copyright holder. This has major repercussions for the role of UK fair dealing defences as it renders the doctrine ineffective in the digital arena. Kretschmer worries this amounts to a ‘possibility of perpetual copyright.’[32] In addition to this under 5(1), the directive provides for technical exceptions which involve necessary copying for technological process and digital content. Temporary reproductions such as the cache of files within a browser which copy files of data will not infringe copyright as such acts are ‘incidental and should have no economic significance.’[33] In light of such developments it can be suggested there is a need to find alternative solutions to reward copyright owners interest within a digital context. There is a need for copyright to ‘generate new resources of remuneration’[34] for rights owners instead of functioning in a prohibitive manner. Kretschmer proposes alternative system of royalties to be used to compensate owners who can not stem the tide of digital copying. For example ‘a small royalty percentage on content traffic revenues from ISP’s would have been the obvious legal innovation.’[35] Such novel solutions are needed in order to successfully balance the freedom of information with traditional copyright interests. In conclusion this paper argues for the need to make changes and decided upon pragmatic alternative solutions to the current legal situation. Fair dealing should be redefined to enable copyright infringement defences take into account the development of digital content. It can be suggested to ensure greater flexibility the UK should adopt the wider US fair use doctrinal approach to defending infringement. Legislation should widen the scope of fair dealing through standard factor based tests. Adopting such standards would promote a liberal approach to asses the degree and nature of infringement. This is needed to make sure the vital balancing act of competing ideological tensions continue within intellectual property law. Bibliography Klang Murray (eds) Human Rights in the Digital Age, 2005 Cavendish Lloyd, Information Technology Law 4th Ed, 2004 ,OUP Bently Sherman, Intellectual Property Law, 2nd Ed, 2004, Oxford Holyoak Torremans, Intellectual Property Law, 3rd Ed, 2001, Butterworths Intellectual Property Law, Fourth Edition 2004, Cavendish Publishing J Griffiths, Preserving Judicial Freedom of Movement –Interpreting Fair Dealing In Copyright Law IPQ 2000, 2,2 164-186 M. Kretschmer, Digital Copyright: End of an Era, 2003 www.cippm.org.co.uk Joint Information Systems Committee and Publishers Association, Guidelines for Fair Dealing in An Electronic Environment, 1998, www.ukonln.ac.uk/services/elib/papers/pa/fair/intro.html R. Buchan, Fair Picture, Guidance from the English High Court on Fair Dealing for the Purpose of Criticism and Review, as Applied to Copyright Material, The Journal of Law and Society, August 2005, Page 52, www.journalonline.co.uk/article/1002090.aspx 1 Footnotes [1] W. Landes and R. Posner, An Economic Analysis Of Copyright Law, (1989) 18 Journal of Legal Studies, 325-366 [2] Http://en.wikipedia.org/wiki/idea-expression_divide [3] www.cippm.org.uk, M. Kretschmer, Digital Copyright: The End of An Era [4] http:en.wikipedia.org/wiki/copyright/fair_use_and_fair_dealing [5] www.cippm.org.uk, M. Kretschmer, Digital Copyright: The End of An Era [6] as above [7] Donoghue v Allied Newspapers Limited (1938) Ch 106 [8] Copyright, Designs and Patent Act 1988 [9] Lord Denning Hubbard v. Vosper (1972) 2 QB 84 1 All ER [10] Hubbard V Vosper (1972) 2 QB 84, 1 All ER 1023 [11] Independent television Publications Ltd v. Time Out Ltd (1984) FSR 545 [12] p. 258 Holyoak and Torremans, Intellectual Property Law, 3rd Edition, Butterworths, 2001 [13] Sillitoe v. McGraw-Hill Book Co (UK) Ltd (1983) FSR 545 [14] Pro Sieben Media AG v. Carlton TV (1999) [15] p.259 as above [16] p.259, Holyoak and Torremans, Intellectual Property Law, 3rd Edition, Butterworths, 2001 [17] www.cippm.org.uk, M. Kretschmer, Digital Copyright: The End of An Era [18] http://en.wikipedia.org/wiki/fair_use [19] http://fairuse.stanford.edu.copyright_and_fair_use_overview/chapter9/index.html [20] http://en.wikipedia.org/wiki/fair_use [21] Mattel Inc v. Walking Mountain Productions [22] http://en.wikipedia.org/wiki/fair_use [23] http://en.wikipedia.org/wiki/fair_use [24] Time Inc. v. Bernard Geis Associates 293 F Supp. 130 [25] Grand Upright v. Warner 780 F Supp 182 (S.D.N.Y 1991) [26] Sony Corp v. Universal City Studios , 464 U.S 417, 451 (1984) [27] as above [28] www.cippm.org.uk, M. Kretschmer, Digital Copyright: The End of An Era [29] p.268, Holyoak and Torremans, Intellectual Property Law, 3rd Edition, Butterworths, 2001 [30] p.8 www.cippm.org.uk, M. Kretschmer, Digital Copyright: The End of An Era [31] as above [32] p.10 as above [33] as above [34] as above [35] p.3, M. Kretschmer, Digital Copyright: The End of An Era