Social Construction of Female Gangs

Social Construction of Female Gangs Introduction In the UK, there has been very little research on female gang problem which has led to the vast amount of research from the USA being applied to the UK situation. Female gangs have been in existence throughout history although very little has been said about its members beyond their role as sexual objects. Hallsworth and Young (2008):176) following a home office report in 2008 state that the gang was for the first time explicitly linked to the problem of urban violence and rising weapon use in the UK (2008:176) and according to Campbell (1990) girls have been a part of gangs since the earliest accounts from New York in the early 1800s (1990:166). Female gang activity has been on the increase in the latter half of the twentieth century and as such, these activities have increasingly become violent. In this essay, I will elaborate on the meaning of gangs and female gangs using various definitions given by key authors. My main interest in this paper will be to discuss the historical bac kground of female gangs and the key debates surrounding these gangs in relation to the literature written by authors of different calibers and also the myths as portrayed by the society. I will also be interested in discussing the media construction of female gangs giving examples which will lead me to explore the disconnection between what the media says about female gangs and what the reality is. The term gang according to Schneider and Tilley (2004) does not have a single definition even though it is used universally by researchers, police, social workers, media and the general public (2004: xviii). The US National Criminal Justice Reference Service have defined the term gang as a group of three or more people who have a common name or sign and have an aim of engaging in criminal activity. In the UK context, experts have found it difficult to reach a consensus on whether or not gangs exist and how they can be defined (Aldridge and Medina, 2008; Alexander, 2008; Broadhurst et al., 2009; Hallsworth and Silverstone, 2009; Her Majestys Inspectorate of Prisons, 2010; Pickles, 2009; Pitts, 2008). Websters Dictionary (1961) gives us another definition stating that a gang is a band or group of persons who involve themselves in criminal or socially unacceptable behavior (1961:74). Female gang is simply a girl group or individuals who are involved in criminal activities and share the same names, symbols and signs as their identity. Female gangs do not have a visible leader and according to research that they tend to be fairly informal and they do not often have a visible leader. Campbell for example in the Huffs book on Gangs in America (1990) observes that in Los Angeles some gangs have veterinas or godmothers but she goes on to say that typically the members insist there is no leader and that decisions are made democratically. Campbells observation suggests that some girls clearly have more clout than others, but that this usually is not formalized as a leadership role. (1990: 178). In this review, I will discuss about female gangs drawing upon American research but with more emphasis on the rising phenomenon of female gangs in Britain. In order to accomplish my aim for this literature review, I will use primary sources, some secondary sources and other policy documents or government publications to enable me make conclusions and recommendations, identifying gaps in knowledge which may inspire other researchers into ideas for further research and also enable me to give my general opinion of how I feel about the social construction of female gangs by the media much of which I tend to disagree with. Literature Review Historical Background Many researchers and journalists have for a long time assumed that girls and women did not take part in criminal behaviors and therefore the issue of female gang has often been ignored. Campbells (1990) review on girl gangs states that, girls were defined solely in terms of their relations to male gang members (1990:166). Men have always been the point of concentration in investigating gang crimes and until recently, female gang members were seen as sex objects or tomboys. Literature has shown that researchers describe female gangs as weapon carriers for the male counterparts in addition, Moore and Hagedorn (2001) argue that even when describing female gang members as tomboys, researchers emphasized that the females motivations were focused on males (2001: 2). Looking at the UK context of female gangs, literature on girls and gangs has not been well developed because researchers in Britain have not seen the need to concentrate on female gangs (Campbell and Muncer, 1989; Sanders, 2002 ). According to Downes (1966); Parker (1974) and Scott (1956), the UK tried to apply American gang theories to address the problem of street gangs but these attempts failed over time leading to lack of data on gangs. This explains why there is no sound evidence as in the case of USA, for the proliferation of violent street gangs (Hallsworth and Young, 2008: 177). Female Involvement is not a new occurrence universally. In fact, there has been a lot of concern on the rise of female involvement in gang business over the years. Early studies found that there was a 50 percent increase in serious crimes by teenage gins between 1968 and 1974, compared to a 10 percent increase for boys and arrests of girls under 18 for violent crimes rose 393 percent between 1960 and 1978, compared to 82 percent for boys (CASA Website) . Miller (2001) compared youth gang involvement in 1950, and found out that youth gangs of the 1980s and 1990s are more numerous, more prevalent, and more violent than in the 1950s, probably more than at any time in the countrys history (2001: 263). In the early 1980s, Anne Campbell (1981) became interested and had concerns about female offenders which led her to conduct an investigation about the occurrences of violence amongst girls in Britain. Campbell, (1984) also did an investigation on female gangs in America and this led to her conclusions that the problem of female gangs was socially constructed. She criticized Britain for only concentrating on male gangs and ignoring female gangs and illustrated that in New York, women were very unlikely to organize in to gangs in big numbers because the female groups were only known to follow male groups (Campbell, 1995). Recent studies on girls and violence also shows that there has been an increase in violent and aggressive behaviour by girls and this has been catalyzed by media attention. Earlier on, people knew very little about girls violence because there was a belief that violence was solely committed by men. The study findings show very little evidence suggesting that girls are physically violent. Membership Academic research on gang membership in the UK is very sparse as mentioned earlier on and there is little evidence showing that young women have existential experience in committing violence. It has been difficult to ascertain the numbers of female gangs although there is a significant existence of the members. On the other hand, in the US, feminist researchers have tried to provide a more nuanced portrayal of the complex gender experiences of girls in gangs (Miller, 2001: 16). They have demonstrated that girls involvement in female gangs meets their gender expectations and experience heightened risks for physical and sexual victimization and also ascertains that gang membership provides them with a sense of belonging, giving them confidence and refuge from their abusive families (Campbell, 1990; Joe and Chesney-Lind, 1995; Joe Laidler and Hunt, 2001; Miller, 2001, 2008; Moore, 1991; Nurge, 2003). Many gangs appear to be more highly structured than delinquent groups but that does not disqualify the fact that they may still be seen as loosely organized. Several factors such as age, neighborhoods and so on are considered as the basis of gaining entry to these gangs or becoming a member. The gang sizes range from a member group of four or five and can go beyond a thousand. There have been different classification of gang groups such as the leaders, associates of the regulars then there are the peripheral members and finally the recruits. Most studies have shown that the reasons why females join gangs are because of friendship influence, it is seen as a form of solidarity and self affirmation. Research has indicated that those kids who grow up in dysfunctional families and whose parents are in prison may find it appropriate to join gang groups. Many youth gang formation is as a result of the present deteriorating economic conditions which are characterized by poor housing, lack of school structures and facilities and lack of laws that regulate violation of youth gangs. Being in a female gang may be a refuge from physical and sexual abuse at home. Young et al.s (2007) was involved in a research which directly involved girls and young women who had association with female gang and this gave him a different picture of their involvement. UK studies of female gangs have indicated that girls and young women are just portrayed as girlfriends to their male gang members but Young et als involvement in interviewing some of the females indicated that their groups were mainly composed of peers whose main reason for being together was plain friendship and denied that their groups were gangs. However in the US, Miller (2001) states that young womens group formation was through friendships from school, their house neighborhoods and not through any initiation rites to join these groups. Evidence uncovered by Young et al. (2007) stated that all the female groups interviewed referred to each other as their mates. Seven young women belonged to all-female groups and although they would periodically hang about with the local young men, this was not because these relationships with males were considered to be important or necessary. Indeed, from their testimonies it was evident that these women did not consider the males around them as friends or even friendly, nor did this group enter into intimate relationships with the young men they associated with. These young women determined when they associated with the males in their social circle and were not significantly influenced by the actions of males or male-dominated groups (Young et al., 2007: 143). A study conducted by Pitts in 2007 considers female membership in gangs as Reluctant Gangsters: Youth Gangs in Waltham Forest (Pitts, 2007). According to Pitts (2007), young women in gangs are often sexually exploited, sometimes in exchange for drugs and the relationships (they have with male members) tend to be abusive; one of dominance and submission and also some senior gang members pass their girlfriends around to lower ranking members and sometimes to the whole group at the same time (2007: 39). Pitts (2007) study states that the reason why young women, or girlfriends, are attracted to the gangs is mainly because they believe they can be glamorous or become celebrities within the group. It is unclear how members of female gangs are able to maintain long term roles and specific position given that the core members decide on the primary roles of the gang groups. Some members join the groups for a short period and others may move on to other gang groups after a certain period of ti me but in all these groups, the core members still remain in charge of the criminal activities. Statistics The most widely used data on female gangs has been from the nationwide surveys of law enforcement agencies. Miller (1975) stated that a survey conducted in the mid-1970s indicated that 10 percent of all gang members were estimated to be female and according to Spergel (1995), a national survey found that in 1992 only 3.7 percent of all gang members were female. This was due to the fact that 32 percent of the surveyed jurisdictions did not, as a matter of policy, identify females as gang members (Curry and Decker, 1998: 98). Four years later in 1996 there was an estimate that 11 percent and then 1998, 8 percent of all gangs were female (Moore and Terrett, 1998; National Youth Gang Center, 2000). It is noted that it is in small cities and rural areas where female gangs are more likely to be found and their ethnicities vary by regions (National Youth Gang Center, 2000). In 2003 the Channel 4 documentary Dispatches emphasized that the gang problem was increasingly spreading in the UK and as many as 30,000 gangs were functional and 57 percent included female members (Thompson, 2003). The Metropolitan Police Service (MPS, 2005) released the most recent figures with findings that there were 174 street gangs in London. In 2006 the MPS figures showed that there was a 66.6 per cent increase in gang membership raising the number of UK gangs to 50,000 of which 2500 of the total number were young women (MPS, 2006). The United States gang numbers according to recent police estimates indicate that there are 27,000 gangs with approximately 788,000 members (National Youth Gang Survey, 2007). According to these reports, there was a 25% increase in the reported numbers of gang and gang problems since the year 2001 where there was a low report on gang problems (National Gang Center, 2009). Curry, Fox, Ball, Stone (1992) and National Gang Center (2009) reported that in 2007 there were gang problems in large cities, 86% more than what was reported in 1983 which was at 50% when the gang problem was just beginning to grow. Media construction of female gangs Media representations on gangs and more specifically female gangs have played a very big role in informing the social reality by a social constructionist perspective. In the past two decades, gang crime activities have dominated the crime news and the quality of life among rural and urban dwellers has been eroded also, violent young females have been presented as a new and growing social problem(Batchelor, 2009:408). According to Batchelor (2009) girls have been perceived to be the same as boys especially in fighting to defend themselves (2009:400). Batchelor continues to argue that young women who involve themselves in male gangs have been used as carriers of weapons and drugs and in some cases the girls have been exploited sexually. News in the media has claimed that young women have acted as the heads of anti-social youth groups who commit crimes like rape, murder and violent robbery (Young, 2009). Many newspapers produce stories with an aim of attracting peoples attention and informing them on what they think the public want to read about thus making a lot of sales on the papers. The medias main interest had been to enhance its economic aspect by manipulating the public way of thinking about crime and its social context (Potter and Kappeler 1998). The main contribution of the media has been according to Best (1993:119), a contextual constructionism of gangs where the media makes certain choices of what to cover in the news which contributes to the social construction of the reality. Crime narratives and representations are, and have always been, a prominent part of the content of all mass media( Reiner, 2007:305), with sources such as newspapers and television documentaries playing a central role in creating public perceptions of crime and therefore influencing their perceptions about the extent of crime and the risk of suffering it (Treadwell, 2006:77). Media reports especially in the UK have not been backed up by concrete evidence on the wider female gang problems. The Centre for Social Justice (2009) states that media coverage has, at times, been suggestive of an epidemic in gang-related youth violence (2009:19). In the UK, television headlines and documentaries relating to gang violence and the coming up of girl gangs has been dominant and that has not been different in the case of USA where it has been reported that gang groups are armed, dangerous and prepared to kill (Hallsworth and Young, 2008:176). Despite the fact that gangs and gang activity has been seen as a social problem to society and despite the regular convictions from the news that has shaped such problems, a comprehensive and systematic analysis of newspaper coverage of gangs and societys war on gangs has not been undertaken. There have been extraordinary cases of female violence reported. For example the reported case of a frenzied attack of eight strangers which was enacted by Chelsea OMahoney, who was the only female member of Sergeant Crew, in conjunction with her male friends (Laville, 2005). This case signifies that there are existing modern girl gang members who offend the law. The press gave an impression that made the public perceive the girl involved as aggressive and one capable of extreme behaviour, a trouble maker who causes havoc in and out of her group and catalyses others to be involved in aggressive behaviour (Thompson ,2003). In the next section, I will analyze the literature review and the medias perception towards female gangs. I will explore the information given in order to see if there is a disconnect between what the media says and what the reality is about female gangs. This will aid me in making proper conclusion about the media construction of female gangs. Analysis It has been argued that reports on female gangs offending the law is very low compared to male offenders and noted that female violence is a relatively rare occurrence according to crime statistics. Various authors like Campbell (1995) have stated that Britain for many years had not developed any research on female gangs whereas in New York, female groups were only seen as followers of their male counterparts and could not possibly form gang groups to organize crimes. On the other hand, the press has had much to write on the papers and commentate in news about girl gangsters especially in the last ten years. According to Tara (2009) there have been news reports contending that young women are traditionally engaged in violent crimes. Reports have in excess claimed that many anti-social youth groups are now headed by young women and they commit crime such us rape, murder and robbery. Honigsbaum (2006) states that young women in the UK are cited to be amongst the most violent and aggres sive in the world. It is clear that there have been a few empirical studies on female gang membership especially in the UK although the media coverage of violent offences committed by young women has created a certain perception towards the girl gangsters. This construction of female gangs has also been through the statistical evidence that has been provided by officials from the law enforcement department. Comparing the literature on female gangs and what the media has had to say about this topic, it is evident that there have been gaps in research on female participation in gangs in the UK which is the same case as the American gang literature where else, the media has been successful in socially constructing the girl gangs even though its evidence is very scant. Over the years, most researchers have concentrated on investigating the male gangs, studying the criminal behaviour of men and ignoring the female counterparts. According to Pitts (2007), the female gangs have not been recognized or in some cases, research has been conducted in reference to the experience of men. In reality, female gangs have been in existence for decades but it has been difficult to come up with the true picture of the problem. In the case of UK, there have been claims that currently young women are more likely to engage in street gangs and these women are more likely to engage in serious violent crime. This information is not substantial because the media seems to exaggerate this kind of violent crime thus shaping the public perceptions of gangs. There is a problem of statistic as well. It has been noted that female gangs exist in larger cities but there is no evidence to suggest that female crime is a national problem, therefore the true problem cannot be identified. Unrealistic public attitudes towards girls gangs have been the order of the day because there has been misrepresentation of girls lives and this according to Batchelor (2001) has created a misdirected public policy. The media has been fond of relying on simple statistics and typical gang cases that have no evidence and this has complicated the discussions of complex socio-specific contexts of violence in girls lives (Batchelor, 2001). Young womens genuine problems continue to be marginalized and ignored as the media continues to give wrong information to the public thus making the girls become a problem. Batchelor (2005); Coy (2008) suggest that it is important that any steps taken to address problems of gang involvement by young women should be from the reality and should be able to acknowledge the yo ung women are active agents and victims. As I have discussed above ,most of the violence that is experienced by girls and young women, as both perpetrators and victims, takes place within either the family or their friendship group. This means that social work and probation practitioners need to give careful attention to the familial and peer contexts of young womens offending, putting in mind that both groups can be concurrently harmful and protective. (Batchelor, 2005) argues that if we are to working towards effecting change in young women offenders lives, we need to maximize on their involvement and participation in various positive activities. These activities should enable them relate well with their families and friends and also the social work teams in order to have positive relations. There is need for accessible and affordable leisure activities which can be effective in occupying the girls and young womens minds and address some specific needs like bullying and victimization. It could be argued that research in to the phenomena of the girl gang especially in the UK is barely adequate thus making it difficult to make quantifying conclusion of the girl gang problem. Much of this essay clearly states that crime statistics show that compared to male offending female violence is a relatively rare occurrence (Young, 2009:224), and any rise in female violence may not always be gang related. I will conclude this essay by indicating that a lot of information represented by the media is just assumptions with no evidence to back it and researchers can do more towards looking more into the problem. Conclusion There seems to be no concrete theory as to why girls of women get involved in violent crimes but there have been various factors that have been cited to have played a major role in influencing them to join gang activities. Parental negligence, poverty, teenage pregnancies, lack of education, ill health, early involvement in sexual activities and peer group influence are some of the factors that drive these girls and women into gangs. Researchers, the law enforcement system, school, community based programmes and families have ignored the fact that female gangs exist and have confined young female to victimization and this has resulted to the rise of female violence. This essay has considered the background information of female gangs, the definition of gang and female gang, the key debates surrounding these gangs in relation to literature written, also the media construction of female gangs and the myths as portrayed by the society. It is argued that many researchers have ignored females as gangs and the notion seems to be that female gangs and their members are pale imitations of male gangs (Spergel, 1995: 90). Due to lack of research, facts that have been written and reproduced in books about female gangs are based on journalists and probation officers reports and also the statements given by the male gang members. Looking at the past and current research on female gangs, it is clear that they do exist in the UK and the USA although the statistics given are socially constructed due to the fact that the gang related cases are underreported. Reliable statistics may show that the problem of female gangs is not as large as the media portrays it to be and with the media catalyzing the problem, it may have negative consequences such as labeling to girls and young women. Media reports fuelling a moral panic can also have an impact on how the community and the government responds to female gangs thus failing to tackle the needs of these female groups. I will conclude by saying that it would be important for researchers to further explore the problem of female gangs because I completely agree that they exist and need attention otherwise the problem will get out of hand if ignored. The media should stop exaggerating facts on female gangs and concentrate on finding out the true picture of these gangs.

Examine the ways in which the relationship between the public and the police is presented in this extract and elsewhere in the play

In Murmuring Judges, the second play in Hare’s trilogy which examines institutions, Hare presents the relationship between the police and the public as one of mutual dislike. Interestingly, Hare never openly shows the public to dislike the lawyers, who act as the antagonist throughout the play due to their uncaring attitude towards client, but it is omnipresent towards the police, who are shown to be more in touch with people. Here, Hare is perhaps consciously suggesting that the people dislike the police as they are the ‘face of justice’ and thus perceived by the public to be the ‘enemy’. Although Hare does present the police to hold some racist and prejudiced views, showing they clearly aren’t perfect, he does largely present the police in both Murmuring Judges and his research book Asking Around as trying to do a hard job in difficult times. From our first introduction to the police, we see they are instantly disliked by the public. In Act 1 Scene 3, the first to involve the police, Keith states â€Å"you’re all bloody bastards† which immediately creates sympathy from the audience for the police. This sympathy is increased throughout the novel, where Hare generally presents the police as good people, an example of which is Sandra, who is shown as trying to enforce justice fairly in a corrupt system. The public dislike for the police is shown to be mutual though, â€Å"I’m not sure I care for the public that much†, which highlights the police frustration at the difficulty of their job, which is shown to be exacerbated by non-cooperative suspects, as shown through Keith’s repetition of â€Å"I’m not saying anything†. This furthers sympathy towards the police, as the public perception and the audience’s perception seem to be very different, as at this point in the play the police are presented as entirely honest. Dislike for the police is also shown later in the play, â€Å"I bloody hate the sodding police†, but here the police are shown to have grown more tired of the public and are more irritated, â€Å"do you have any idea, you stupid arsehole, how bloody boring it is for us? However, the public only further underlying frustration, as the Criminal Evidence Act of 1981 made policing more about paperwork, which created frustration amongst the police as for them it lowered their ability to do their jobs. In Asking Around, Hare states â€Å"[the police] are used to doing a great deal of good for the community and they’re used to having it thrown back in their face†. This could explain the police’s frustration at the public and also their seeming lack of interest in their jobs, as they no longer have the incentive to help those who hate them. Read also Intro to Public Relations Notes The police are shown to become more frustrated as the play progress, although the time period is unknown, could suggest that more and more acts were continually introduced. However, Hare continues to present the police as ‘the good guys’, as he shows Lester to be â€Å"only interested in protecting the public†, which reinforces the idea that police frustration largely stems from the public. Despite the public perception of the police as â€Å"tossers†, the police are wholly presented as the most in touch with people and the most realistic, â€Å"what we’re talking about here is reality†. This is best shown in the juxtaposition of the lawyers and the police’s view of public interest. Whereas Sir Peter believes â€Å"everyone listens to Desert Island Disks†, which the is obviously untrue, as this is a largely middle class radio station and shows the lawyers to be completely out of touch with the public, Lester states â€Å"I’d rather be in bed with Michelle Pfeiffer. † This is a much more relatable statement for the public, as it is likely that there is a larger proportion of people who would rather be in bed with Michelle than there is who listen to Desert Island Disks. Through this direct contrast, Hare shows the lawyers to be dated whereas the police are presented as realistic, and with the same manner and feelings as the public, which can be exemplified by the sarcastic tone from Lester towards the clients, â€Å"go and stand up there next to him, it makes no difference to me†. The extent of the police’s involvement with the public is shown starkly when Barry confronts Irina and asks â€Å"when was the last time anyone was sick on your wig? The mocking tone suggests is frustration at the public and the image of the public vomiting on the police shows them to be obviously more in touch with the public than the lawyers. Contextually, however, the public distrust of the police is understandable, as cases like the Guilford four and the Birmingham Six highlighted police corruption and showed the police to be immoral, as Barry is shown to be here. Perhaps the worst relationships presented between the police and the public are those which highlight the racist and generally prejudiced attitudes of the police at the time. Barry suggests that Gerard is more likely to be guilty as â€Å"he was kind of Irish†, which shows an innate prejudice, as he assumes that his nationality makes him more likely to commit crime. Significantly, Hare presents the public as aware of this racism through Jason, who is black, as he states â€Å"if you go through with this†¦I’m going to get a bobble hat and grow bloody dreadlocks. † Here, it is suggested that the police are inherently racist, as Jason implies that he was arrested simply because he was black, showing he too believes the police are racist. Although here it is a matter of justice, rather than racism, in the focus scene Hare does present the police as prejudiced. Through Lester’s statement, â€Å"I hate immigration†¦and bloody women†, Hare presents the police as prejudiced, which could arguably suggest why they are so disliked by the public as this shows them to be unjust. Just as the public are shown to be aware of racism within the police, sexism is also obvious as Sandra says â€Å"just ask the boys, all women are naggers†. However, I believe this may have been inherent and gone unnoticed by the police, as perfectly summed up in the line â€Å"they don’t know they’re prejudiced†, as the play was written in 1991, when racism and sexism were seen as everyday occurrences. Hare describes the police as â€Å"the people trying to keep their sense of humour in the face of massive contradictions†. This is evident in the relationship between the police and the public, as the police generally use a light tone and humorous phrases, which suggests the police would like to get along with the public, but they make this impossible. This is strengthened by Hare’s presentation of the public, as they are shown to be non-cooperative or â€Å"grovelling†. In contrast, Hare occasionally presents the police as prejudiced and disinterested in their jobs, which undermines the police-public relationship, but it is largely obvious that Hare blames the public for the poor public relations as the police are largely just attempting to do their job in difficult circumstances, which is only worsened by the public perception of them as unjust and prejudiced.

Question Bank International Business Essay

Chapter 07 Foreign Direct Investment True / False Questions 1. (p. 242) A firm becomes a multinational enterprise when it undertakes foreign direct investment. TRUE 2. (p. 242) Licensing involves the establishment of a new operation in a foreign country. FALSE 3. (p. 242) If a firm that makes bicycles in Germany acquires a French bicycle producer, Greenfield investment has taken place. FALSE 4. (p. 242) The amount of FDI undertaken over a given time period is known as the flow of FDI. TRUE 5. (p. 242) The total accumulated value of foreign-owned assets at a given time is the inflow of FDI. FALSE 6. (p. 242) FDI is seen by executives as a means of circumventing future trade barriers. TRUE 7. (p. 244) Historically, most FDI has been directed at the developed nations of the world as firms based in advanced countries invested in the others’ markets. TRUE 8. (p. 246) The total amount of capital invested in factories, stores, office buildings and the like is referred to as the stock of FDI. FALSE 9. (p. 246) The largest source country for FDI has been China. FALSE 10. (p. 247) About 27 percent of the world’s largest 100 nonfinancial multinationals in 2004 were American companies. TRUE 11. (p. 247) In developing countries, about one third of FDI is in the form of mergers and acquisitions. TRUE 12. (p. 248) In 2004, about two thirds of FDI stock was in service industries. TRUE 13. (p. 249) As compared to exporting and licensing, FDI is the more expensive and risky. TRUE 14. (p. 250) Internalization theory is also known as the market imperfections approach. TRUE 15. (p. 250) One of the problems of licensing is that it may result in a firm’s giving away valuable technological know-how to a potential foreign competitor. TRUE 16. (p. 251) An oligopoly is an industry composed of a limited number of large firms. TRUE 17. (p. 252) When two or more enterprises encounter each other in different regional markets, national markets or industries regional competition occurs. FALSE 18. (p. 252) According to Vernon, location specific advantages can help explain the nature and direction of FDI. FALSE 19. (p. 253) Dunning, in the eclectic paradigm theory, suggests that a firm must establish production facilities where foreign assets or resource endowments necessary to the production of the product exist. TRUE 20. (p. 254) Pragmatic nationalism traces its roots to Marxist political and economic theory. FALSE 21. (p. 254) Classical economics and the international trade theories of Adam Smith and David Ricardo form the basis for the free market view. TRUE 22. (p. 255) The free market view argues that FDI is a benefit to both the source country and to the host country. TRUE 23. (p. 255) Countries adopting a pragmatic stance pursue policies designed to maximize the national benefits and minimize the national costs. TRUE 24. (p. 256) An aspect of pragmatic nationalism is the tendency to aggressively court FDI believed to be in the national interest by, for example, offering subsidies to foreign MNEs in the form of tax breaks or grants. TRUE 25. (p. 257) Foreign direct investment can make a positive contribution to a host economy by supplying capital, technology and management resources that would otherwise not be available and thus boost that country’s economic growth rate. TRUE 26. (p. 258) There is research supporting the view that multinational firms often transfer significant technology when they invest in a foreign country. TRUE 27. (p. 258) Jobs created in local suppliers as a result of the MNE’s investment and jobs created because of increased local spending by employees of the MNE are examples of direct employment effects of FDI. FALSE 28. (p. 258) Host country citizens that are employed by an MNE following an FDI are an example of an indirect effect of FDI. FALSE 29. (p. 259) A country’s balance of payments accounts keep track of both its payments to and its receipts from other countries. TRUE 30. (p. 259) A current account deficit exists when a country imports more than it exports. TRUE 31. (p. 259) In recent years, the U.S. has run a persistent balance of payments surplus. FALSE 32. (p. 260) Host governments sometimes worry that the subsidiaries of foreign MNEs may have greater economic power than indigenous competitors. TRUE 33. (p. 261) FDI does not benefit the host country’s balance of payments if the foreign subsidiary creates demand for home-country exports of capital equipment, intermediate goods or complementary products. FALSE 34. (p. 262) The term offshore production refers to FDI undertaken to serve the home market. TRUE 35. (p. 263) Countries cannot prohibit national firms from investing in certain countries for political reasons. FALSE 36. (p. 264) The two most common methods of restricting inward FDI are ownership restraints and performance requirements. TRUE 37. (p. 265) The WTO has been very successful in efforts to initiate talks aimed at establishing a universal set of rules designed to promote the liberalization of FDI. FALSE 38. (p. 266) Licensing is a good option for firms in high-tech industries where protecting firm-specific expertise is of paramount importance. FALSE 39. (p. 266-267) Typically licensing will be a common strategy in oligopolies where competitive interdependence requires that multinational firms maintain tight control over foreign operations so that they have the ability to launch coordinated attacks against their global competitors. FALSE 40. (p. 267) Licensing is more common in fragmented, low-tech industries in which globally dispersed manufacturing is not an option. TRUE Multiple Choice Questions 41. (p. 242) FDI occurs when a A. Domestic firm imports products and services from another country B. Firm ships its product from one country to another C. Firm invests in the stock of another company D. Firm invests directly in facilities to produce and/or market a product in a foreign country 42. (p. 242) A Greenfield investment A. Is a form of FDI that involves the establishment of a new operation in a foreign country B. Involves a 7 percent stock in an acquired foreign business entity C. Involves a merger with a foreign business D. Occurs when a firm acquires another company in a foreign countr 43. (p. 242) If General Electric, a U.S. based corporation, purchased a 50% interest in a company in Italy, that purchase would be an example of a(n) A. Minority acquisition B. Outright stake C. Majority acquisition D. Greenfield investment 44. (p. 242) The amount of FDI undertaken over a given time period is A. The flow of FDI B. The stock of FDI C. The FDI outflow D. The FDI inflow 45. (p. 242) The stock of FDI is A. The amount of FDI undertaken over a given period of time B. The total accumulated value of foreign owned assets at a given time C. The flow of FDI out of a country D. The flow of FDI into a country 46. (p. 242) FDI has been rising for all of the following reasons, except A. The globalization of the world economy B. The general increase in trade barriers over the past 30 years C. Firms are trying to circumvent trade barriers D. There is a shift toward democratic political institutions and free market economies 47. (p. 244) Historically, most FDI has been directed at the _____ nations of the world as firms based in advanced countries invested in A. Underdeveloped, underdeveloped countries B. Developed, underdeveloped countries C. Developed, each other’s markets D. Underdeveloped, each other’s markets 48. (p. 244) The U.S. has been an attractive target for FDI because of all of the following reasons, except A. Its small and wealthy domestic markets B. Its dynamic and stable economy C. Its favorable political environment D. Its openness to FDI 49. (p. 244) Identify the incorrect statement regarding the direction of FDI. A. Historically, most FDI has been directed at the developing nations of the world B. During the 1980s and 1990s, the United States was often the favorite target for FDI inflows C. The developed nations of the EU have received significant FDI inflows D. Recent inflows into developing nations have been targeted at the emerging economies of South, East and Southeast Asia 50. (p. 246) Africa is not a popular destination for FDI because of all of the following reasons, except A. Political unrest in the region B. Armed conflict in the region C. Liberalization of FDI regulations D. Frequent policy changes in the region 51. (p. 246) The total amount of capital invested in factories, stores, office buildings and the like is summarized by A. Gross fixed capital formation B. Total investment capital C. Total tangible investment D. Gross depreciable investments 52. (p. 246) The largest source country for FDI since World War II has been A. Japan B. China C. The United States D. The United Kingdom 53. (p. 247) Most cross-border investment is A. In the form of Greenfield investments B. Made via mergers and acquisitions C. Between American and Japanese companies D. Involved in building new facilities 54. (p. 247) Which of the following is not a reason why firms prefer to acquire existing assets rather than undertake green-field investments? A. Foreign firms are acquired because those firms have valuable strategic assets B. Firms make acquisitions because they believe they can increase the efficiency of the acquired unit by transferring capital, technology or management skills C. Even though Greenfield investments are comparatively less risky for a firm acquisitions always yield higher profits D. Mergers and acquisitions are quicker to execute than green-field investments 55. (p. 247) In developing nations most FDI inflows are in the form of A. Mergers B. Greenfield investments C. Acquisitions D. Non-profit organizations 56. (p. 248) The sector composition of FDI shows that by 2004 approximately _____ of FDI stock was in service industries. A. One fourth B. One third C. Two third D. Half 57. (p. 248) The rise in FDI in the services sector is a result of all of the following, except A. The general move in many developed countries away from manufacturing and toward services B. Accelerating regulations of services C. Many services cannot be traded internationally D. Many countries have liberalized their regimes governing FDI in services 58. (p. 248) When strategic assets such as brand loyalty, customer relationships or distribution systems are important, _____ investments are more appropriate. A. Merger and acquisition B. Greenfield C. Portfolio D. New construction 59. (p. 249) _____ involves granting a foreign entity the right to produce and sell the firm’s product in return for a royalty fee on every unit sold. A. Horizontal FDI B. Licensing C. Vertical FDI D. Greenfield investment 60. (p. 249) In a licensing arrangement, the _____ bears the risk and cost of opening a foreign market. A. Licensee B. Licensor C. Acquiring firm D. Greenfield investor 61. (p. 250) Identify the theory that seeks to explain why firms often prefer foreign direct investment over licensing as a strategy for entering foreign markets. A. Internalization theory B. Internationalization theory C. Perfect markets theory D. Small markets theory 62. (p. 250) According to the internalization theory, all of the following are drawbacks of licensing as a strategy for exploiting foreign market opportunities, except A. Licensing does not grant control over manufacturing, marketing and to a licensee in return for a royalty fee B. Licensing may result in a firm’s giving away its know-how to a potential foreign competitor C. Licensing does not give the firm the tight control over manufacturing, marketing and strategy that may be required to profitably exploit its advantage D. A firms capabilities such as the management, marketing and manufacturing are often not amenable to licensing 63. (p. 250) ______ is also known as market imperfections theory. A. Internationalization theory B. Internalization theory C. Perfect markets theory D. Small markets theory 64. (p. 251) If four firms control 80 percent of a domestic market, then ______ exists. A. An oligopoly B. A monopoly C. An oligarchy D. Vertical integration 65. (p. 251) According to Knickerbocker A. The firms that pioneer a product in their home markets undertake FDI to produce a product for consumption in a foreign market B. When a firm that is part of an oligopolistic industry expands into a foreign market, other firms in the industry will be compelled to make similar investments C. Combining location-specific assets or resource endowments and the firm’s own unique assets often requires FDI D. Impediments to the sale of know-how increase the profitability of FDI relative to licensing 66. (p. 252) The eclectic paradigm was developed by A. F. T. Knickerbocker B. Adam Smith C. Raymond Vernon D. John Dunning 67. (p. 252) When two or more enterprises encounter each other in different regional markets, national markets or industries, there is A. Vertical integration B. Horizontal integration C. Multipoint competition D. Monopolistic competition 68. (p. 252) The product life cycle suggests that A. Often the same firms that pioneer a product in their home markets undertake FDI to produce a product for consumption in foreign markets B. When a firm that is part of an oligopolistic industry expands into a foreign market, other firms in the industry will be compelled to make similar investments C. Combining location-specific assets or resource endowments and the firm’s own unique assets often requires FDI D. Impediments to the sale of know-how increase the profitability of FDI relative to licensing 69. (p. 253) The _____ suggests that a firm will establish production facilities where foreign assets or resource endowments that are important to the firm are located. A. Product life cycle B. Strategic behavior theory C. Multipoint competition theory D. Eclectic paradigm 70. (p. 253) Advantages that arise from using resource endowments or assets that are tied to a particular location and that a firm finds valuable to combine with its own unique assets are known as A. Location specific advantages B. Resource specific advantages C. Competitive advantages D. Directional advantages 71. (p. 253) John Dunning, a champion of the eclectic paradigm, argues that A. The firms that pioneer a product in their home markets undertake FDI to produce a product for consumption in a foreign market B. When a firm that is part of an oligopolistic industry expands into a foreign market, other firms in the industry will be compelled to make similar investments C. Combining location-specific assets or resource endowments and the firm’s own unique assets often requires FDI D. Impediments to the sale of know-how increase the profitability of FDI relative to licensing 72. (p. 254) According to the _____ view of FDI, MNEs extract profits from the host country and take them to their home country, giving nothing of value to the host country in exchange. A. Imperialist B. Conservative C. Free market D. Radical 73. (p. 254) Which of the following is not a reason that the radical position of MNEs was in retreat by the end of the 1980s? A. The strong economic performance of those developing countries that embraced capitalism rather than radical ideology B. The collapse of communism in Eastern Europe C. The generally abysmal economic performance of those countries that embraced the radical position D. A growing belief in many capitalist countries that MNE’s tightly controls key technology and that important jobs in the MNEs’ foreign subsidiaries go to home-country nationals 74. (p. 255) According to _____ international production should be distributed among countries according to the theory of comparative advantage. A. The radical view B. The eclectic view C. Pragmatic nationalism D. The free market view 75. (p. 256) A distinctive aspect of _____ is the tendency to aggressively court FDI believed to be in the national interest by, for example, offering subsidies to foreign MNEs in the form of tax breaks or grants. A. The dogmatic view B. Pragmatic nationalism C. The radical view D. The conservative view 76. (p. 257) When a company brings capital and/or technology to a host country, the host country benefits from the A. Competitive effect of FDI B. The resource transfer effect of FDI C. The balance of payments effect of FDI D. The effect on competition and economic growth 77. (p. 258) When jobs are created in local suppliers as a result of the FDI and when jobs are created because of increased local spending by employees of the MNE, the MNE has a _____ effect on employment. A. Direct B. Indirect C. Inward D. Outward 78. (p. 259) A _____ keeps track of a country’s payments to and its receipts from other countries. A. Federal payments ledger B. Current accounting system C. Checks and balances account D. Balance of payments account 79. (p. 259) The _____ tracks the export and import of goods and services. A current account deficit or trade deficit as it is often called, arises when a country is importing more goods and services than it is exporting. A. Current account B. Debit account C. Surplus account D. Capital account 80. (p. 261) Three costs of FDI concerns of host countries arise from all of the following except A. Adverse effects on competition within the host nation B. Adverse effects on the balance of payments C. The perceived loss of national sovereignty and autonomy D. Debit on the current account of the home country’s balance of payments 81. (p. 262) FDI undertaken to serve the home market is known as A. Greenfield investment B. FDI substitution C. Offshore production D. Home market FDI 82. (p. 263) Double taxation is A. Charging double taxes in the home country B. Charging double taxes in the host country C. Taxation of income in both home and host country D. Paying income taxes at twice the normal rate 83. (p. 264) _____ are controls over the behavior of the MNE’s local subsidiary. A. Performance requirements B. Ownership restraints C. Double taxation laws D. Greenfield restrictions 84. (p. 267) Licensing would be a good option for firms in which of the following industries? A. High-technology industries in which protecting firm-specific expertise is of paramount importance and licensing is hazardous B. Global oligopolies, in which competitive interdependence requires that multinational firms maintain tight control over foreign operations C. Industries in which intense cost pressures require that multinational firms maintain tight control over foreign operations D. In fragmented, low technology industries in which globally dispersed manufacturing is not an option 85. (p. 267) _____ is essentially the service industry version of licensing, although it normally involves much longer term commitments. A. Franchising B. Subsidizing C. Greenfield investment D. Patenting Essay Questions 86. (p. 242) Discuss the connection between foreign direct investment and multinational enterprises? Foreign direct investment (FDI) occurs when a firm invests directly in new facilities to produce and/or market a product in a foreign country. The U.S. Department of Commerce states that FDI occurs whenever a U.S. citizen, organization or affiliated group takes an interest of 10 percent or more in a foreign business entity. Once affirm undertakes FDI, it becomes a multinational enterprise. 87. (p. 242) What are the two forms of foreign direct investment? The two forms of FDI are Greenfield investment or establishing a new operation in a foreign country and mergers and acquisitions whereby a company expands internationally through an existing firm. Acquisitions can be minority, majority or a 100% ownership position. 88. (p. 242) Discuss the trends in FDI over the last 30 years. Be sure to differentiate between the stock of FDI and the flow if FDI. The flow of FDI refers to the amount of FDI undertaken over a given period, while the stock of FDI refers to the total accumulated value of foreign-owned assets at a given time. Over the last 30 years there has been a marked increase in both the flow and the stock of FDI in the world economy. Over this period, the flow of FDI accelerated faster than the growth in world trade and world output. 89. (p. 242) Discuss the reasons for the growth in FDI over the last 30 years. FDI has grown more rapidly than world trade and world output for several reasons. First, many companies see FDI as a means of circumventing potential trade barriers. Second, political and economic changes in many of the world developing nations has been encouraging FDI. Finally, the globalization of the world economy is having a positive impact on the volume of FDI as firms now see the whole world as their market. 90. (p. 242-248) What is a Greenfield investment? How does it compare to an acquisition? Which form of FDI is a firm more likely choose? Explain your answer. FDI can take the form of a Greenfield investment in a new facility or an acquisition of or a merger with an existing local firm. Research show s that most FDI takes the form of mergers and acquisitions rather than Greenfield investment. Mergers and acquisitions are more popular for three reasons. First, mergers and acquisitions are quicker to execute than Greenfield investments. Second, foreign firms are acquired because those firms have valuable strategic assets. Third, firms make acquisitions because they believe they can increase the efficiency of the acquired firm by transferring capital, technology or management skills. 91. (p. 248) Discuss the shift in FDI from manufacturing to services. What is driving the trend? Over the last twenty years, the sector composition of FDI has shifted from extractive industries and manufacturing toward services. By 2004, some 66 percent of the stock of FDI was in services. Four factors are driving the shift to services. First, the shift reflects the general move in many developed economies away from manufacturing and toward service industries. Second, many services cannot be traded internationally and FDI is a principal was to bring services to foreign markets. Third, many count ries have liberalized their regimes governing FDI in services making the option more attractive to firms. Finally, the rise of Internet-based global telecommunications networks has allowed some service enterprises to relocate some of their value creation activities to different nations to take advantage of favorable factor costs. 92. (p. 249) Consider why firms selling products with low value-to-weight ratios choose FDI over exporting. Products with low value-to-weight ratios such as soft drinks or cement are frequently produced in the market where they are consumed. When transportation costs are added to production costs, it becomes unprofitable to shift such products over a long distance. For firms that can produce low value-to-weight products at almost any location the attractiveness of exporting decreases and FDI or licensing becomes more appealing. 93. (p. 250) Discuss the market imperfections explanation of FDI. What is its relationship with internalization theory? Market imperfections or factors that inhibit markets from working perfectly, provide a major explanation of why firms prefer FDI to either exporting or licensing. In the international business literature, the marketing imperfections approach is referred to as internalization theory. According to the theory, FDI will be preferred when there are impediments that make both exporting and the sale of know-how difficult and/or expensive. 94. (p. 250) What is licensing? How does it work? Licensing occurs when a domestic firm, the licensor, licenses to a foreign firm, the licensee, the right to produce its product, to use its production processes or to use its brand name or trademark. In return, the licensor collects royalty fees on every unit the licensee sells or on total licensee revenues. The licensor also benefits from the arrangement in that the licensee bears the cost and risk of expanding into a foreign market. 95. (p. 250) Compare and contrast the advantages of foreign direct investment over exporting and licensing. A firm will favor foreign direct investment over exporting as an entry strategy when transportation costs or trade barriers make exporting unattractive. Furthermore, the firm will favor foreign direct investment over licensing (or franchising) when it wishes to maintain control over its technological know-how or over its operations and business strategy or when the firm’s capabilities are simply not amenable to licensing, as may often be th e case. 96. (p. 251) Consider the notion that FDI flows are a reflection of strategic rivalry between firms in the global marketplace. What is the main limitation of the theory? The strategic behavior approach to explain FDI was initially expounded by Knickerbockers who argued that in an oliogopolistic industry, a â€Å"follow the leader† mentality will prompt firms to pursue FDI when another firm in the industry  has already done so. However, the theory fails to explain why the first firm decided to undertake FDI, rather than export or license. 97. (p. 252) What is multipoint competition? How do firms respond to multipoint competition? Multipoint competition arises when two or more enterprises encounter each other in different regional markets, national markets or industries. Economic theory suggests that firms will try to match each other’s moves in different markets to try to hold each other in check. If a firm is successful with this strategy, the firm will ensure that a rival does not take a commanding position in one market and then use the profits generated in that market to underwrite competitive attacks in other markets. 98. (p. 252) Explain the product life cycle theory and its connection with FDI. The product life cycle theory, developed by Ray Vernon, suggests that the same firms that pioneer a product in their home country will undertake FDI to produce a product for consumption in foreign markets. According to the theory, firms will invest in industrialized countries when demand in those countries is sufficient to sup port local production. They subsequently shift production to developing countries when product standardization and market saturation give rise to price competition and cost pressures. Investment in developing countries, where labor costs are lower is seen as the best way to reduce costs. 99. (p. 252-253) What are location-specific advantages? How do they help explain FDI? Location specific advantages are advantages that arise from using resource endowments or assets that are tied to a particular foreign location and that a firm finds valuable to combine with its own unique assets. Natural resources such as oil and minerals for example, are specific to certain locations. Firms must undertake FDI to exploit such foreign resources. 100. (p. 253) Explain John Dunning’s position on FDI. What is the eclectic paradigm? John Dunning has argued that to fully understand FDI it is important to consider the role of location specific advantages. According to Dunning, a firm will be prompted to undertake FDI in an effort to exploit assets that are specific to a particular location. Dunning’s theory, the eclectic paradigm, combines the arguments of internalization theory with the notion of location-specific advantages to suggest that combining location-specific assets or resource endowments and the firm’s own unique capabilities often requires the firm to establish production facilities where the foreign assets or resource endowments are  located. 101. (p. 254-256) Discuss the various political ideologies and their impact on foreign direct investment. The radical view writers argue that the multinational enterprise (MNE) is an instrument of imperialist domination. The free market view argues that international production should be distributed among countries according to the theory of comparative advantage. The pragmatic nationalist view is that FDI has both benefits and costs. The radical view has a dogmatic radical stance that is hostile to all inward FDI The free market view is at the other extreme and based on noninterventionist principle of free market economics. Between these two extremes is an approach called pragmatic nationalism. 102. (p. 257-262) Discuss the benefits and costs of FDI from the perspective of a host country and from the perspective of the home country. The main benefits of inward FDI for a host country arise from resource-transfer effects, employment effects, balance-of-payments effects and effects on competition and economic growth. Three costs of FDI concern host countries. They arise from possible adverse effects on competition within the host nation, adverse effects on the balance of payments and the perceived loss of national sovereignty and autonomy. The benefits of FDI to the home (source) country arise from three sources. First, the home country’s balance of payments benefits from the inward flow of foreign earnings. Second, benefits to the home country from outward FDI arise from employment effects. Third, benefits arise when the home-country MNE learns valuable skills from its exposure to foreign markets that can subsequently be transferred back to the home country. The most important cost/concern of FDI for the home country centers on the balance-of-payments and employment effects of outward FDI. 103. (p. 266-267) Describe the situations when licensing is not a good option for a firm. Licensing is not a good option in three situations. First, licensing is hazardous in high-tech industries where protecting firm-specific expertise is very important. Second, licensing is not attractive in global oligopolies where tight control is necessary so that firms have the ability to launch coordinated attacks against global competitors. Finally, in industries where intense cost pressures require that MNEs maintain tight control over foreign operations, licensing is not the best option. 104. (p. 267) What is franchising? What type of firm uses franchising as a means of expanding into foreign markets? Franchising is essentially the service-industry version of licensing. With franchising, the firm licenses its brand name to a foreign firm in return for a percentage of the franchisee’s profits. The franchising contract specifies the conditions that the franchisee must fulfill if it is to use the franchisor’s brand name. Franchise agreements usually have a longer time commitment than do licensing arrangements. Franchising is common in the fast food industry because fast food cannot be exported, because franchising minimizes the costs and risks associated with opening a foreign market, because brand names are relatively easy to protect, because there is no compelling reason for a firm to have tight control over franchisees and because fast food know-how is easily transferred. 105. (p. 267) How useful are the product life cycle theory and Knickerbocker’s theory of horizontal FDI to business? The product life cycle theory and Knickerbocker’s theory of horizontal FDI to business are not particularly useful from a business perspective because the theories are descriptive rather than analytical. The theories are useful for explaining historical patterns of FDI, but they do a poor job of identifying the factors that influence the relative probability of FDI, licensing and exporting.

The Book That Caught My Eye Was Freakonomics A Rogue...

Economics has never been a class I had interest in or felt that I excelled in. Since attending Boise State I have realized that I really enjoy economics and have been learning to understand more about how economics works. In taking this class, we were told to choose a book and do a bibliography. The book that caught my eye was Freakonomics: A Rogue Economist Explores the Hidden Side of Everything by Steven Lewitt and Stephen J. Dubner. I chose this book because after looking through multiple books, I decided this one was the most interesting. I read the back of the book and was intrigued by Steven Lewitt and how he studies riddles of everyday life. I am going to assess the 6 chapters and give an overall summary and my evaluations of the novel. Freakonomics has three main concepts relating to economics: winner takes all labor market, supply demand and equilibrium price and incentives matter. Chapter 1 starts out with a study on ten day-care centers in Haifa, Isreal. This study lasted twenty weeks. The first four weeks of the study economists kept track of parents who arrived late picking up their child. As a result of these findings, a fine was instilled. This fine was $3 fee for any parent arriving ten minutes late. Economists were thinking that with this fee, the number of child pick ups would drop, but instead the number of late pickups actually increased. Economics found that the incentive had backfired. Here we see one of the concepts found in the book, incentives