Healthcare Marketing Essay Example | Topics and Well Written Essays - 1000 words

Healthcare Marketing - Essay Example The follow-up is not required and no effort is made to build customer relationship. The transactional marketing relies on its quality and delivers care at sight which meets its broader objectives and goals. The relationship marketing on the other hand, relies on building constructive relations with the patients. Through newsletters and feedbacks, the healthcare organizations build trust of the patients and improve and improvise their services and products to suit the requirements of the patients. Its main focus is on acknowledging customer value and building long-term relations with the customers. The six criteria vis-Ã  -vis goal, customer contact, organizational focus, customer responsiveness, quality concern and time perspectives play significant role in relationship marketing. They provide the basic framework of relationship marketing that strengthen customers’ confidence in the service and the organization. The organizational goal changes from profit to meeting the requirements of the patients. Getting feedback from customers and keeping in touch with them is reflected in the customers’ responsiveness and higher credibility of the organization. The doctor-oriented service mainly refers to the attitude and behaviour of doctors when they are meeting or treating them. The doctors’ indifference to the appointment schedule and their lack of accountability to their patients becomes important issue within customer service in healthcare area. It is one of the major sins in the healthcare industry. The hospitals that are not transparent in their wait-list, billing or the treatment of diseases tend to lose their credibility. Transparency in the operations of healthcare services considerably inculcates trust amongst the patients. Confidential information of patients cannot be divulged to third parties without the express consent of the patients. Hospitals which tend to either disclose confidential information to third parties like research

Strategic Human Resource Management Coursework Example | Topics and Well Written Essays - 1750 words

Strategic Human Resource Management - Coursework Example Training is concerned with improving the current task force performance whereas development aims to build up and it increases competence level of employees for the better future performances. Q. 2 Hiring employees who need training is advantageous when the organisation need to maintain a particular knowledge and skills up to date for competitive purpose. Technology keeps on changing rapidly; thus it becomes beneficial to the company when they hire employees whom they need to train. This is vital because it will enable the business to create significant changes that will enable them to achieve a competitive advantage. However, it becomes advantageous to the company when they hire already trained employees because they already have significant work experience; thus this reduces costs of training, time and other resources of training unskilled employees. They also add knowledge to already existing organisation team and they are less costly to the company since training is costly and tim e consuming. Q. 3 The organization can determine in case its training is effective through employing effective evaluation criteria. Varied models have been developed in order to determine in case the training is effective; thus performance indicator is one of the models employed in determining the training effectiveness. Another criteria used is the dependent measure for operationalizing the effectiveness of training but there are other new approaches and models that have been proposed by researchers on evaluating the effectiveness of training (Arthur, Bennett, Edens and Bell, 2003). Kirkpatrick’s model is one of the new frameworks that attempt to reveal the effectiveness of training; thus this model takes into consideration four significant steps or criteria for determining the effectiveness of training. One of the steps is reaction criteria, which employs self report measures and another one is learning criteria, which measure the learning outcomes. Behavioral criteria also measure the actual work performance and it identifies the effect of t raining on actual performance. Lastly, results criteria and this determines in case the quality or productivity of the work has been improved. Q. 4 Behavioral methods are designed performance appraisal, which is based on rating the task performance of workforce depending on their behaviors. This is vital because it enables managers to determine the effectiveness or ineffectiveness of working performance for employees. Behavioral method judges the actions of employees by using a rating scale to evaluate or measure their particular behaviors. On the other hand, personnel comparison method is used for measuring and comparing each labor force with others in a certain group. Personnel comparison is considered an effective and reliable method of performance appraisal in situations where only employee need to be promoted; thus it is vital for ranking an employee against others in a group on diverse factors until they fi nd the best employee. Q. 5 The performance appraisal refers to the technique employed by HR managers to assess the task performance of a workforce. It is purpose is to assess the task of workforce in regard to particular standards. It is employed in measuring work performance of employees in order to determine their strength and weaknesses. It is imperative because it helps managers to offer efficient training programs or remunerate workforce according to the task

European Union Environmental Business Law Essay Example for Free

European Union Environmental Business Law Essay The Treaty of Rome which established the European Economic Community in 1958, did not originally included any provisions for the safeguard of the environment It was not until 1985 that the Single European Act inserted Title VII containing articles 130r to 130t in the Treaty of Rome that made environmental protection a lawful objective of the Commission and laid down the core principles upon which the environmental policy was based (Poostchi 83). The core principles as stated by Poostchi are â€Å"the principles that preventative action should be taken, that the polluter should pay and that environmental damage should be rectified at source. These legal principles as given by the Single European Act were further refined by The Maastricht Treaty which enhanced the scope of the environmental policy of the European Union. Today the European Union has over 200 directives (legal texts) with environmental policies under the broad classifications of Air, Biotechnology, Chemicals, Civil Protections and Environmental Accidents, Climate Change, Land Use, Noise, Ozone Layer Protection, Soil, Waste and Water as well as issues like public participation in environmental decision making and public access to environmental information. Development and Implementation of Environmental Law The EU has the option of adopting environmental legislation by way of three primary legal instruments: (i) directives, (ii) regulations, and (iii) decisions. Regulations and decisions are binding in their entirety and are directly applicable within Member States; directives, are binding as to the result to be achieved, but leave to the Member States the choice of form and method, which means that member states have the power to enact local legislation based on a directive to further the cause of initiating it in the first place (Goodrich). The branch of law dealing with the environment has the same system of development and enforcement as other laws developed by the commission. The primary responsibility of EU is to develop environmental laws, while the duty of implementation and enforcement rests in the hands of the 25 member states. Herein lays the strength and weakness of the system. The strength lays in the fact that member states have greater power of enforcement than a council of 25 states, but at the same time member states enjoy considerable flexibility in enforcement which often leads to delays or avoidance of implementation, thereby frustrating the purpose of the law itself. The Legislative Process The Commission is responsible for ensuring compliance with environmental laws. By undertaking its own assessments, through complaints by EU parliament and petitions by EU citizens, the commission monitors the degree of compliance. If after review there is evidence of a breach of law, the EU initiates the infringement proceedings against the violating state. There are three categories of breaches 1) Non-communication cases, in which a member state fails to, inform EU about the adoption of national legislation implementing a directive after the deadline for implementation has passed. 2) Non-conformity cases, in which a member state implements a directive incorrectly. 3) Bad-application cases, in which a member state has failing to correctly apply community law in a particular case. The infringement procedure contains several steps which are outlined in Article 226 of the Treaty. The Commission usually upon receiving a case, issues a formal notice to the government, after which it can issue a reasoned opinion. If the member state still refuses to comply the commission refers the case to the European Court of Justice, for a ruling. Non-compliance with a ruling can lead to the imposition of a fine or lump-sump penalty on the member state. In April 2004 environmental liability directive was issued by the EC with the aim of preventing and remedying environmental damage. According to the directive (which is to be adopted by member states over a period of 3 years) Environmental damage can be remedied in several ways depending on the type of damage: For damage affecting the land, the Directive requires that the land concerned be decontaminated until there is no longer any serious risk of negative impact on human health; For damage affecting water or protected species and natural habitats, the Directive is aimed at restoring the environment to how it was before it was damaged. Another development in the environmental law front is the possibility (proposal for a directive) of criminal action against serious negligence and intentional damage. According to a press release by the EC (Brussels, February 2007) the law would apply to both natural and legal persons. The proposal lays down the maximum penalty, and allows member states to impose more stringent measures. The motivation to introduce criminal action is because although EC Environmental law has existed for 30 years, there are still many cases of severe non- observance of Community environmental law. According the Seventh Annual Survey on the implementation and enforcement of Community environmental law 2005 (Commission Staff working paper Brussels, 2006) there has been a significant reduction in the number of open cases at the end of the year 2005 (798 cases) as opposed to 2004 (1220 cases). However the Environment sector, still accounts for one-fourth of all open cases concerning non-compliance with Community Law under investigation by the Commission. EU Environmental Law and International environmental law Over the past 30 years EU had made tremendous impact on environmental law legislation by enforcing very stringent environmental standards across its member nations. Environmental laws are discriminatory by nature, as they favor countries with developed infrastructures, wealthy industries and higher per capita incomes. For EU to expect all its trading partners (irrespective of their national income and stage of development) to comply with its strict Environmental laws, means that it will seek to eliminate any advantage that they might have in terms of lower prices. Environmental laws can serve as a form of non-tariff trade barrier. As in the case if Shrimp-Turtle case (USA banned the import of shrimp from countries which in the process of shrimp trawling accidentally caused the death of sea turtles. These countries were expected to install US made Turtle Excluder Devices (TEDs), so that the shrimp trawling would become environmentally friendly again) (Schaffer et al. 628). The net effect was to increase the sales of a US industry (the industry making TEDs), and possibly raise the price of imported shrimp products. (Schaffer et al. 623) United States ran into trouble with the WTO on the ban on shrimp products, because it was declared uncompetitive and unfair. Subsequently USA had to redefine its guidelines, so that exporting countries which employed a programme similar to that of the USA for turtle protection were given a certification to export again. Impact on FDI and International Businesses EU’s has emerged as the leading incubator for environmental rules and regulations, and this has major implications for all businesses hoping to work with the European market. This includes businesses within and outside the European Union. This is mainly because of two reasons. Businesses must comply with EU regulations if they wish to continue supply and demand to the region. Secondly like all highest forms of legislation (and constructive action in general) the EU legislation set the benchmark for environmental regulation and there may come a time when they will be followed and implemented across the globe. Recently the Commission enacted 3 new laws, which will have a significant effect on businesses trading in EU. The three regulations are REACH (Registration, Evaluation, and Assessment of Chemical Hazards); RoHS (Restriction of Hazardous Substances); and WEEE (the directive on Waste Electronic and Electric Equipment). All three are complex pieces of legislation that will affect a vast range of products, chiefly electronics that are made, sold, used, and disposed of across 25 EU member countries. (Elkington) The first legislation will make mandatory testing of over 30,000 chemical substances for human safety. This will put the fate of several chemical companies in jeopardy. RoHS seeks to ban six substances out of the E. U. economy: lead, mercury, cadmium, hexavalent chromium, polybrominated biphenyls (PBBs), and polybrominated diphenyl ethers (PBDEs). This will make it nearly impossible to manufacture semiconductors for electronic items. The third legislation (WEEE) will affect manufacturers of products like TVs, refrigerators, or cars. This take-back legislation will force companies to take the responsibility of recycling packaging material of their product and also ensure recycling of discarded products (end of life accountability). This legislation takes root from the concept of recycling all waste material so that some of it can be re-absorbed (re-claimed) in the productive process, instead of going unutilized into landfills. These legislations will have a number of implications for local and foreign countries in Europe. Firstly they will have to invest in take-back and recycling infrastructure. It is generally observed that big companies adopt the law, in fear of retaliation from NGO’s, and because they refused to be driven out of markets because of these de-facto trade barriers. Korean and Japanese countries demonstrated this when they took a lead in adopting the ISO 14000 standards, so that they cannot be discriminated in the European Market. The rate of adoption of companies from these countries was faster than that of EU companies themselves. The possible impact of stringent environmental laws is felt on domestic companies as well. During a period of economic downturn and business slowdown, most businesses are reluctant to enforce environmental legislation. Also the cost of monitoring the legal environment for businesses increases. EU is actively taking notice of breach in compliance with environmental laws and the process of pursuing legislative action at the European court is a time wasting and expensive affair. According to the OECD report on FDI, the 2003 FDI inflows to European countries were 23 per cent lower than in 2002. But according to data available with UNCTAD, for the period 2004-2006 FDI picked up again and the EU countries recorded a growth of 30% . Thus it cannot be determined to a conclusive level whether the changes in FDI have resulted because of the enactment and enforcement of environmental laws. It may be noted that European Union’s proactive behavior in enacting environmental legislation could be because they had a smaller land mass and learned the importance of conservation before other bigger countries like US. Whatever the case maybe, it remains to be seen whether the extensive array of laws will improve the environment to any noticeable degree. Given the number of years it takes for degradation to become noticeable any fruits of improvement will take time to manifest themselves. Till then both foreign and domestic businesses will find themselves facing a host of challenges, ranging from legislative action, forced compliance, rising environmental compliance cost and the like. However it will also open opportunities for businesses to develop eco-friendly products, and maintain a positive image in the minds of consumers.

Profitability and Corporate Leverage Policy of Firms

Profitability and Corporate Leverage Policy of Firms Abstract This study attempts to determine the relationship between the profitability and leverage policy of firms of Fuel and Energy sector of Pakistan. The analysis was implemented on 27 firms in the Fuel and energy sector listed at the Karachi Stock Exchange for the period 2003-2008. Regression was used to find out the relationship between the independent variable (Profitability) and dependent variable (Leverage). We expect the negative relationship between the Profitability and the Leverage Policy of firms in the Fuel and Energy sector of Pakistan, confirming the pecking order theory of capital structure. The results found in our study were not as expected. The results showed that there is inverse relationship between profitability and leverage but our results were not that much significant to accept our hypothesis. So we rejected our pecking order theory hypothesis. Therefore we conclude that because of certain factors such as economic situation of the Pakistan, rising prices of oil all a round the world, interests rates and reliance of firms financing needs mostly on bank financing, pecking order theory model becomes insignificant in the Energy and Fuel sector of Pakistan. Chapter-1 Introduction Capital structure involves different decisions taken by a firm in financing its assets. Generally, a firm can solve this issue through different mixes of debts, equity, or other financial arrangements. It can also combine bonds, TFCs, lease financing, bank loans or many other options with equity in order to boost the market value of the firm. 1.1 Importance of the topic: Optimal capital structure plays a vital role in the overall value maximization of a firm. The strategic management of capital structure ensures access to the capital needed to fund future growth and enhance financial performance. Our focus in this study is to correlate the profit of the firm with its leverage. Importance of the study is to find out that which source of funds either retained earnings, debt or equity, a firm in the Fuel and Energy sector should prefer in order to optimize the profit and the value of the firm. In Pakistan, firms usually prefer short-term borrowing, because commercial banks are the major lenders and they do not encourage long-term loans. Up to 1994 firms did not rely on market based debt; in mid 1994 the government amended the Company Law to help companies to raise debt directly from the market in the form of TFCs (Term Finance Certificates). 1.2 Background of the study: Various capital structure theories had been discussed by many authors to explain the variation of capital structure of different firms. So many researches had also been taken place in order to solve the mystery of optimal capital structure in Pakistani firms. A thorough research study relating to the capital structure was carried by two Pakistani professors Shah and Tahir (2004) which attempted to answer the question of what determines the capital structure of Pakistani Listed firms other than those in financial sector. Booth, et. Al (2001) had also worked on the determinants of capital structures of 10 developing countries including Pakistan, but their data analyzed the firms that were included in the KSE-100 Index from 1980 to 1987. Shah and Tahir (2004) analyzed the data of non-financial firms for the period of 1997-2001 while our study differs from theirs on grounds of different sector, variables and period. 1.3 Objective of the study: The objective of this study is to find out the relationship between the profitability and the corporate leverage policy of firms in the Fuel and Energy sector of Pakistan. We are trying to figure out that the firms that have more profits in the Fuel and Energy sector have lower leverage. Our main focus in this study is to correlate the profit of the firm with its leverage in the context of pecking order theory. According to pecking order hypothesis firms tend to use internally generated funds first and than resort to external financing. This implies that profitable firms will have less amount of leverage. Therefore we expect a negative relationship between profitability and debt of a firm i.e. higher the profits of a firm, the lesser will be its debt. 1.4 Scope of the study: This study is limited on the Fuel and Energy sector of Pakistan. There are 27 firms of that sector which are listed on the Karachi Stock Exchange. But after screening the firms with incomplete data, we have selected 22 firms having complete data for six years from 2003-2008 as the study covers the period from 2003 to 2008. 1.5 Disposition of the study: This study is organized into five stages. In first stage we have described the background of our topic. In second stage review of literature has been done. In next stage we have explained our data and variables used in our analysis. At fourth stage we have discussed the model and the statistical test to be used. While the last stage concludes the results of the test. Chapter 2 Literature Review In this chapter we have gone through the various research studies regarding the leverage and well known capital structure theories. Capital structure refers to specific mixture of debt and equity a firm needs to finance its operations and optimal capital structure plays a vital role in the overall value maximization of a firm. This has given birth to different capital structure theories that attempt to explain the variation in capital structures of firms. The Miller Modigliani theorem showed that the market value of a firm is determined by the risk of its underlying assets and its earning power and is independent of the choices to finance its investments i.e the value of the firm is independent of the capital structure it takes on. But Myers suggested the contemporary thinking on capital structure in form of Static Tradeoff Theory. This explained that a firm initially following a target debt-equity ratio behaves accordingly. The costs and benefits related to the debt option make this target ratio. The costs and benefits are cost of financial distress, tax shields and agency cost. There are different theories that are used to explain the capital structure decisions which are based n the asymmetric information, tax benefits associated with the debt, bankruptcy cost and agency cost. The asymmetric information is related with pecking order framework and the other three are rooted in static trade-off choice. Under the trade off theory firms tried to equate the marginal benefits of an additional unit of debt with the related marginal cost, while holding the firms assets and investments plans. Under this model the key benefits are debt tax deductibility and the mitigation of agency cost while the main cost of additional debt is bankruptcy. Green, Murinde and Suppakitjarak (2002) observed that the tax policy also effect the capital structure decision of firms. Firm are allowed to deduct interest on debt in computing taxable profit under tax ordinance while the payments associated with the equity such as dividends are not tax deductible. Therefore, the tax effect encourages the debt usage by the firm if the rates are higher and more debt increases cash savings in form of after tax proceeds to the owner. Usage of debt in the capital structure of the firm also leads to agency cost which arises as a result of relationship between the share holder and manager while the firms management is the agent and the share holder being the principal. Agent may not choose to maximize their principals wealth. The conflict arises as the managers have less than 100% of the residual claim. Thus, managers may invest in projects that reduce the value of the firm while enhancing their control over its resources. Additional cash flow is the prime source of the agency cost. Debt helps to mitigate this agency cost as the firm is committed to pay out excess cash in the form of interest payments. The probability of bankruptcy increases with the increase in the level of the debt. If the firm goes beyond the optimum level of debt, then it is more likely that the firm will default on the repayment of the loan. As a result of that, the control of the firm will be shifted from share holders to the bond holders or the creditors who will liquidate the firm in order to recover their investment. There are also direct and indirect costs associated with the bankruptcy. Direct cost includes administrative costs of bankruptcy and costs of reorganization in the event of insolvency. While the indirect cost arises when the firm gets into financial distress. It may arise because of the change in the investment policies of the firm if firm foresees possible bankruptcy. In order to avoid the possible financial distress it will cut down the expenditure on certain departments like research and development, training of employees and advertisements etc. Therefore, if a firm is perceived to be close d to bankruptcy customers may be less willing to buy its goods because of low perceived quality of goods and the risk that the firm will not be able to meet its warranty obligation. Employees may also be less interested to work for the firm and creditors are less inclined to extend trade credit. Hence under the static trade off theory the optimal capital structure represents a level of leverage that balances the bankruptcy and the benefits of tax deductibility and mitigation of the agency costs. While The Pecking Order Theory of Myers (1984) and Myers and Majluf (1984), stated that firm while establishing its capital structure follow a hierarchy of financial decisions. First of all firm uses its internal financing i.e. retained earnings in order to finances its projects. In case of need of external financing, they prefer a bank loan first then go for the public debt. Thus in accordance with the Pecking Order Theory, profitable firms while having the available internal funds prefers not to incur debt for new projects. A study was carried by Benito, (2002) which considered the two most influential approaches, the trade off and packing order theories, in understanding capital structure decisions of firms of Spain and United Kingdom. This study made a valuable contribution to our study because of the same objective of testing Pecking Order Theory with reference to capital structure of firms. The resulting data included 6417 Spanish companies over period of 1985-2000 and 1784 British quoted non-financial companies over period of 1973-2000. The results provided significance in favor of pecking order theory, concluding debt ratios found to be significantly inversely related to cash flow and profitability of the firm and vary positively with its investment. In order to find the best empirical explanation for the capital structure of Brazilian firms Medeiros and Cecilio (2004) tested a model to represent the Static Trade-off Theory and Peking Order theory. This theory is helpful for our study because of the same independent variables that is profitability. Profitability all the STT streams sustain that a positive relationship must exist between profitability and debt. The stream based on bankruptcy costs states that these costs increase when earnings fall so that leverage tends to be lower for less profitable firms or those with higher earnings volatility. For the stream focusing on tax benefits, the more profitable the firm the more it benefits from the tax shield provided by interest payments. The agency stream believes that large amounts of free cash flows build up the dispute between shareholders and managers, which make those firms to issue more debt in order to diminish the problem (Fama and French, 2003). According to the POT, retained earnings are the firms best financing option. This type of resource does not produce information asymmetries and can be used promptly for new projects. The information asymmetry caused by equity issues or by more complex securities that require a higher degree of communication with the market is the basis of the POT. It is exactly to dodge the adverse selection premium brought by the information asymmetry that firms opt for internal financing as their major source of resources (Myers, 1984). The relationship between these two variables must be therefore negative. Medeiros and Cecilio (2004) The sample of their study included 371 non-financial firms with shares listed in the Brazilian stock exchanges from 1995 to 2002. The analysis of results of the study led to the conclusion that the pecking order theory provides the best explanation for the capital structure of those firms Another study on the capital structure was carried by Abor, (2008) comparing the capital structure of large un-quoted firms, small and medium enterprises (SMEs) and publicly quoted firms in Ghana using a panel regression model. On the grounds of the similar independent variable this study made a useful contribution to our review literature. The results showed insignificant difference between the capital structures of large unquoted firms and publicly quoted firms. The results of all sample groups showed that the total debt has relatively a high proportion of short-term debt. The results of the regression test indicated that age and size of the firm, profitability, risk, asset structure and managerial ownership are significant influencers in decisions regarding the capital structure of Ghanaian firms. Chiarella et.al (1991) conducted a study in Australia on the determinants of corporate capital structure by seeking to provide evidence on the significance of capital structure determinants in Australian context. This study provided a great support for writing review literature of our study. The analysis was carried on a sample of 226 Australian firms from 1977-1985. The results showed that company non-debt tax shields display a negative relationship with debt ratios. The results also supported the pecking order hypothesis of Myers and Majluf (1984) showing significant negative relationship of profitability with debt ratios and indicating that firms prefer to finance investments with internally retained earnings before issuing debts. The results provided some evidence of size effect indicating that the larger firms tend to employ more debts in their capital structure. Results showed positive but insignificant relationship between cash holdings and debt ratios while confirming the fre e cash flow hypothesis of Jensen (1986). Simultaneously results did not provide any support for growth opportunity and collateral value attributes as determinants of debt ratios. A study on the Malaysian companies regarding the capital structure and the firm characteristics was carried by an Indian professor Pandey (2000). This study is useful for our study because of one of the same independent variable i.e. profitability. The study was carried on Malaysian companies in order to examine their determinants of capital structure using data from 1984 to 1999 while classifying the data into four periods that relates to different stages of capital market of Malaysia. Results of the regression clarified that profitability, size; growth, risk tangible variables have significant impact on all debt types. Results showed persistent and consistent negative relationship of profitability with all debt ratios in all periods, thus accepting the prediction capital structure according to the pecking order theory. A research relating to the capital structure was carried by two Pakistani professors Shah and Tahir (2004) which attempted to answer the question of what determines the capital structure of Pakistani Listed firms other than those in financial sector. Because this study was also carried in Pakistan so it provided a support to a great extent in order to understand the capital structure according to Pakistans environment. A sample of 445 listed firms on KSE were taken and their five year data from 1997-2001 were taken into consideration. Pooled regression results indicated that assets tangibility is positively correlated with debt, concluding that asset structure does not matter in determination of capital structure of Pakistani firms. Size was positively correlated with leverage suggesting that large firms would employ more debt. Growth was found to be negatively correlated with leverage that supports the simple version of pecking order theory that growing firms finance their investmen t opportunities first by their internally generated funds. There was strong relationship between profitability and leverage. Profitability was negatively correlated with leverage that supports the pecking order theory. A study in Hong Kong was carried by Hung, et.al (2002) examing the inter-relationship between profitability, cost of capital and capital structure among property developers and contractors in Hong Kong. The results showed that capital gearing is positively related with assets but negatively with profit margins. Bartholdy and Cesario (2006) analysed the decisions regarding the capital structure of Portuguese non-listed bank financed firms. Primary purpose of the research was to find out the impact of debt tax shield on the decisions regarding capital structure of small non-listed firms. The secondary purpose was to find out that whether the determinants of capital structure of larger listed firms were also same as in case of smaller non-listed firms. The research explained that the solution of two big problems (agency and asymmetric information) for large firms are apparent on the balance sheet as restriction on debt. On the other hand it is less apparent on the balance sheet of smaller firms. This provided the smaller firms with the benefit of tax shield due to more debt. This research has provided a great support in writing our review literature and understanding the relationship between profitability and debt to a great extent. The sample of their research consisted 998 firms with 7765 fi rm years observations. The results concluded that the tax provisions regarding the carry forward of tax losses and debt tax shield play a vital role in determining the capital structure of small non-listed firms. It was also concluded that in order to solve agency problem traditional balance sheet variables were significant in large listed firms but were insignificant for the small non-listed firms with the exception of variables required to solve bankruptcy risk. A research study was conducted in Greece by Eriotis, et.al (2007) aiming to isolate the firm characteristics that effect capital structure. The investigation was performed using panel data for a sample of 129 Greek companies listed on Athens Stock Exchange during 1997-2001. The findings justified a negative relationship between the debt ratio of the firms and their growth, and size appeared to have a positive relation. Gropp and Florian (2008) conducted research study regarding the determinants of the capital structure of banks by examining the capital structure of banks from the prospective of empirical capital structure literature for non-financial firms. The sample of the study includes 200 largest listed banks (100 from US and 100 from EU) from the sixteen different countries (US and 15 EU members) from 1991 to 2004. The results suggest that the capital requirements may only be of second importance for banks capital structures and confirm the robustness of corporate finance findings in a holdout sample of banks. In order to examine the capital structure across countries a study was carried by Rajan and Luigi (1994). The primary objective of the study was to establish whether the choice of capital structure in other countries is based on the factors similar to those influencing capital structure of US firms. Study was on the 8000 non-financial corporations of G-7 countries (USA, Germany, Japan, France, UK, Italy and Canada) for the period of 1987-1991. After correcting the differences ranging from accounting practices to legal and institutional environments between the countries. results of the study showed extent to which firms are levered is fairly similar across the G-7 countries except UK and Germany being relatively less levered. Sakuragawa (2001) conducted another study regarding the capital structure of banks under non-diversifiable risk. The purpose of the research was to study the design of optimal capital structure of a large financial corporation when it faces a non-diversifiable risk. When there is a non-diversifiable risk the intermediary finds it profitable to issue equity because by issuing equity it can reduce the cost and the probability of banks failure. The intermediary designs the optimal capital structure by balancing the marginal benefit of reducing probability of banks failure against the marginal cost of debt-equity swap. Results showed that a large corporation under weaker conditions realizes more efficient allocation by issuing both debt and equity than by issuing only debt. An African study was conducted by cole-man (2007) whose aim was to examine the impact of capital structure on the performance of microfinance institutions. Panel data covering the ten-year period 1995-2004 were analyzed within the framework of fixed- and random-effects techniques. Results showed that the most of the microfinance institutions employ high leverage and finance their operations with long-term as against short-term debt. Results also revealed that the highly leveraged microfinance institutions perform better by reaching out to more clientele, enjoy scale economies, and therefore are better able to deal with moral hazard and adverse selection, enhancing their ability to deal with risk. Fernandez (2003) analyzed the driving forces of capital structure in Chile for the period 1990-2002. The purpose of the research was to study aggregate leverage and interest-bearing liabilities in isolation for all firms, and firms segmented by economic sector. Their sample of the study consisted of 64 firms having the complete information for the whole sample period of 1990-2002. Results while supporting the trade-off theory revealed that the firms favored equity over debt issues to cover their financing deficit because of the Chiles tax and monetary policies. In order to find out the determinants of very small firms financial leverage Barbosa and Cristiana (2003) carried a research. They described the relationship between profitability and financial leverage as: As far as profitability is concerned, the most common expectation in the financial structure literature is for a negative relationship with financial leverage. Toy and others (1974 p.877), Marsh (1982 p.126 footnote 22), Friend and Lang (1988 p.277), Titman and Wessels (1988 p.6) and Barton and others (1989 p.40) all say that in different words. According to them, a firm with a high profit rate, ceteris paribus, would maintain a relatively lower debt ratio because of its ability to finance itself from internally generated funds. The preference for raising capital first from retained earnings may be due, according to Titman and Wessels (1988 p.6), to the costs of issuing new equity or debt that arise because of asymmetric information or transaction costs. Marsh (1982 p.126 footnote 22) raises the possibility that the impact may be due to the tendency of firms to issue new equity immediately after periods of abnormally good performance. Hall and Weiss (1967 p.328) assert that relativel y profitable firms take some of their exceptional returns in the form of reduced risk, through retaining earnings, and, therefore, show lower debt to assets ratios. Rajan and Zingales (1995 p.1451) cite Jensen (1986) who predicts that, if the market for corporate control is ineffective, managers of profitable firms prefer to avoid the disciplinary role of debt. This preference would lead to a negative correlation between profitability and debt. Gupta (1969 p.522) speaks of a theory that extends the first belief above mentioned from the firm level to the industry level. Accordingly, profitable industries, because of the greater availability of internally generated funds related to their high profitability; tend to have lower debt in their financial structure. Last, Gale (1972 p.417-8) interprets leverage as representing the degree of risk or otherwise in the industries in which the firm competes and hypothesizes that leverage should then be negatively related to profitability. This a uthor himself acknowledges that his reasoning is somewhat at odds with previous discussions and theory, though. According to him, low debt to total capital ratios would reflect high industry risk because of two aspects. First, the corresponding capital structures would be the result of higher investment on the part of entrepreneurs, who, differently from lenders, place a lower value on security relative to rewards. Second, high-risk industries are, at least theoretically, associated with higher profitability. Barbosa and Cristiana (2003) Results of their research concluded that the growth, entrepreneurs risk tolerance, size and operational cycle were positively correlated with the financial leverage whereas asset composition, inflation, profitability and business risk are negatively correlated with financial leverage of very small firms. Chapter-3 Methodology In this section, we have explained the source of data, sample size, explanation and measurement of the variables, and the regression model. 3.1 Source of Data In this study financial data of firms listed on the Karachi Stock Exchange under Fuel and Energy sector of Pakistan is taken from the State Bank of Pakistan Publications Balance Sheet Analysis of Joint Stock Companies Listed on the Karachi Stock Exchange 2003-2008. 3.2 Sample size This study is carried on the Fuel and Energy sector of Pakistan. There are 27 firms of that sector which are listed on the Karachi Stock Exchange. But after screening the firms with incomplete data, we have selected 22 firms having complete data for six years from 2003-2008 as our study covers the period from 2003-2008. So we have 132 firm years for the panel data analysis. 3.3 Explanation and Measurement of the variables Basically our study follows the framework of Shah and Tahir (2005). We include only two variables in our study. First variable is leverage (dependent variable) and another is profitability (Independent variable). In this section we describe these two variables and explain how they are measured. 3.3.1 Leverage (Dependent variable) Leverage is explained as percentage of assets financed by debts. Different researchers have measured leverage differently. Frank and Goyal (2003) differentiated between two debt ratios, one based on market value while the other on book value. Debt ratio based on market value relates with the firms future situation whereas on the other hand debt ratio based on book value tends to reflect the past situation. While in our study measuring leverage through book value, we have mainly two reasons in our mind. First, one of the main benefits of debt is tax shield that is the interest payments are tax deductible expense, resulting in cash savings. Once the debt is issued these tax shield advantages do not vary by the market value of the debt. Second point in our mind while measuring leverage through book value is the relationship of debt with bankruptcy risk. The probability of bankruptcy increases with the increase in the debt. Moreover, in case of bankruptcy of a firm, the value of the debt through the book value of the debt is more relevant than the market value of debt. While measuring the financial leverage we faced a problem of choosing either total debt or only long term debt as percentage of total assets. Interestingly many capital structure theories favor long term debt but we have used total debt because the average firm size in Pakistan is small which limits their access to capital market because of technical difficulties and cost involved. So the firms in Pakistan prefer short term borrowing because of the fact that the major lenders in Pakistan are commercial banks and they discourage long term borrowing. Firms in Pakistan did not rely on the market based debt upto 1994, but in the mid of 1994 Government while amending Company Law, allowed firms to raise debt directly in the form of TFCs (Term Finance Certificates) from the market. Thus in our study we have measured the leverage through total debt to total asset ratio. 3.3.2 Profitability (Independent Variable) Profitability has been the main point of distinction between the Static Trade-off Theory and the Pecking Order Theory. Static Trade-off Theory explains that the firm with higher profitability has more reasons to issue more debt while taking tax shield benefit. While on the other hand, Pecking Order Theory presupposes that firms with larger earnings tend to use its internally generated funds i.e. retained earnings initially to fulfill their financial needs then they go for debt. Thus, Static Trade-off Theory expects a positive and direct relationship between profitability and leverage of a firm while Pecking Order Theory suggests negative relationship between the two above said variables. We have measured the profitability as the ratio of Net Income before Tax divided by the total assets. 3.4 Research hypothesis This research study supports the Pecking Order Theory hypothesis and our proposed research hypothesis is There is significant negative relationship between profitability and leverage of a firm. Ho: There is significant negative relationship between profitability and leverage of a firm 3.5 Regression Model Linear Regression analysis has been used in this study. Basically we have used pooled regression type of panel data analysis. By saying this we mean that the companys financial data and time series data are pooled together in a column. The equation for our regression model will be LG= ÃŽ ²0 + ÃŽ ²1 (PF) + ÃŽ µ. Where LG= Leverage ÃŽ ²0= Constant PF= Profitability ÃŽ µ= Error term Chapter 4 Results of the test and interpretation. This chapter contains the results of the descriptive statistics and linear regression test. There are 27 firms in Energy and fuel sector which are listed on the Karachi Stock Exchange. But after screening the firms with incomplete data, we have selected 22 firms having complete data for the six years from 2003-2008 as our study covers that specified period. So we have 132 firm years for the panel data analysis. 4.1 Data Consideration: For data consideration to be suitable for linear regression we graph the P-P plot of dependent and independent variable in order to check that the data is normally distributed. The P-P plots of profitability and leverage are as follows. Above Normal P-P Plot of Independent variable (Profitability) shows that the variable follows a normal distribution. On the other hand dependent variable (leverage) is also said to be fairly normally distributed. In order to show the linear regression model is appropriate for the data or not we graph a scatter plot between profitability and leverage which is as follows: Scatter plot shows that whether linear regression model is appropriate for the data or not. However above scatter plot appears to be suitable for linear regression. 4.2 Results of the test: After running the linear regression test on SPSS we have the following results. Table-1 Descriptive Statistics Total No: Minimum Maximum Mean Standard Deviation Profitability (PF) 132 -0.22 0.43 0.0515 0.12441 Leverage (LV) 132 .00 1.27 0.5588 0.27425 Valid No: (list wise) 132 Table-1 contains the descriptive

Racism :: Canadian History, Politics, The Indian Law

The two earlier existing schools, industrial schools and boarding schools, were united into residential schools by the Canadian Government in 1864 (Reimer, 2010:36). Miller (1996) has explained â€Å"the governing of the schools had the form of joint venture between state and church (Roman , Anglican, Methodist or United Church) where the state was responsible for the financing (Miller, 1996:25). ’’ The Canadian Government was responsible directly when it came to establishing residential schools for Aboriginal children. In order to attend residential schools, Aboriginal children were taken away from their families and communities. The proper definition of Aboriginal people or Aboriginal includes Mà ©tis, Inuit, and First Nations regardless of where they live in Canada and regardless of whether they are â€Å"registered† under the Indian Act of Canada (Stout and Kiping, 2003:5). Throughout history First Nations, Inuit, and Mà ©tis people have faced centuries of colonial suppression which has disrupted the process of Aboriginal cultural identity formation. One of the tools of suppression is through the formation of residential schools. At the schools, the children suffered from emotional, physical, sexual and psychological abuse (Stout and Kipling, 2003:8). The trauma to which Aboriginal people were exposed in the past by residential schools continues to have major negative effect to the generations to follow. By the 1840s, the attempts by the churches to â€Å"civilize† Aboriginal people became a matter of official state policy (Claes and Clifton, 1998). This was an era of westward expansion and the government was anxious to prevent any Aboriginal interference with its colonization plans. Subscribing to an ideology that constructed Aboriginal people as backward and savage, government officials believed assimilation was in the population’s best interests (1998; Culture and Mental Health Research Unit, 2000). For example, in 1847, the chief superintendent of education in Upper Canada indicated in a report to the Legislative Assembly that â€Å"education must consist not merely of the training of the mind, but of a weaning from the habits and feelings of their ancestors, and the acquirements of the language, arts and customs of civilized life† (cited in Claes and Clifton, 1998:15). The 1884 amendments to the Indian Act served as a particularly important impetus for growth. On the one hand, they made boarding school attendance mandatory for Native children less than 16 years of age. On the other hand, the revised Act gave authorities the power to arrest, transport and detain children at school, while parents who refused to cooperate faced fines and imprisonment (Claes and Clifton, 1998).

Saddam Hussein: The U.S Portrayal of Evil Encarnate :: American America History

Saddam Hussein: The U.S Portrayal of Evil Encarnate When Iraq invaded and occupied the country of Kuwait in August 1990, the Bush administration was faced with several dilemmas. From a foreign policy point of view, this action could greatly destabilize the balance of power in a part of the world that was vital to U.S. interests. The United States was dependant on a continuous flow of oil to drive its economic machine, which Kuwait supplied greatly. In addition, this move would put more power into the hands of a government that was not only unfriendly to the U.S., but a sworn enemy of the state of Israel, a strong U.S. ally. In addition to, the fall of communism had created what George Bush had described as, "A new world order," and would become the first major test of how the U.S. would handle its role as the sole remaining super power in this "new world order." There were many challenges facing the Bush administration as to the manner in which they would handle this first major international crisis. The Bush administration had to dev elop a consensus of the major remaining powers, and appear not acting alone in its response to President Saddam Hussein's actions of invading Kuwait. They also yearned to keep Israel from being involved so as not to alienate the remaining Middle Eastern nations. Lastly, they faced a domestic dilemma, in that much of the American public had significant reservations about involving U.S. troops involved in a foreign conflict. There remained a bad taste of Vietnam among the American public, and there were very mixed responses to American involvement in Somalia, Nicaragua, and Grenada. For the Bush administration, Hussein was not a merchant who could be bargained with, but rather an outlaw who would have to be defeated by force. The Bush administration was faced with a task of developing (more or less) overwhelming support from the U.S. people to take any action in Kuwait, which was accomplished by a dramatic public relations move to demonize Saddam Hussein in the eyes of the American pe ople. The task of the United States demonizing Saddam Hussein was facilitated by many factors, both real and imaginary; a mixture of true facts and public relations image making. On the fact side, Saddam Hussein was indeed a dictator, and responsible for some true atrocities. Hussein ruled with an iron fist. Most accounts of political analysts looking at Iraq agree that his rein was one characterized by fear of the state. Saddam Hussein: The U.S Portrayal of Evil Encarnate :: American America History Saddam Hussein: The U.S Portrayal of Evil Encarnate When Iraq invaded and occupied the country of Kuwait in August 1990, the Bush administration was faced with several dilemmas. From a foreign policy point of view, this action could greatly destabilize the balance of power in a part of the world that was vital to U.S. interests. The United States was dependant on a continuous flow of oil to drive its economic machine, which Kuwait supplied greatly. In addition, this move would put more power into the hands of a government that was not only unfriendly to the U.S., but a sworn enemy of the state of Israel, a strong U.S. ally. In addition to, the fall of communism had created what George Bush had described as, "A new world order," and would become the first major test of how the U.S. would handle its role as the sole remaining super power in this "new world order." There were many challenges facing the Bush administration as to the manner in which they would handle this first major international crisis. The Bush administration had to dev elop a consensus of the major remaining powers, and appear not acting alone in its response to President Saddam Hussein's actions of invading Kuwait. They also yearned to keep Israel from being involved so as not to alienate the remaining Middle Eastern nations. Lastly, they faced a domestic dilemma, in that much of the American public had significant reservations about involving U.S. troops involved in a foreign conflict. There remained a bad taste of Vietnam among the American public, and there were very mixed responses to American involvement in Somalia, Nicaragua, and Grenada. For the Bush administration, Hussein was not a merchant who could be bargained with, but rather an outlaw who would have to be defeated by force. The Bush administration was faced with a task of developing (more or less) overwhelming support from the U.S. people to take any action in Kuwait, which was accomplished by a dramatic public relations move to demonize Saddam Hussein in the eyes of the American pe ople. The task of the United States demonizing Saddam Hussein was facilitated by many factors, both real and imaginary; a mixture of true facts and public relations image making. On the fact side, Saddam Hussein was indeed a dictator, and responsible for some true atrocities. Hussein ruled with an iron fist. Most accounts of political analysts looking at Iraq agree that his rein was one characterized by fear of the state.

Animal Farm Essay

The novel Animal Farm was cleverly written by George Orwell to make fun of the Russian government. Orwell made all of the events in the book relate to an event during the Russian revolution. The rebellion in George Orwell’s Animal Farm represents the Russian revolution during the reign of Joseph Stalin. This novel is an allegory that can be taken as a children’s book or a book with a serious political opinion. George Orwell was born in India in 1903 to the name Eric Arthur Blair. He was a very opinionated man who despised political lying. Orwell strongly believed in a form of government called socialism. He moved to England an attended Eton college. Shortly after, he moved back to India and joined the Indian Imperial Police for five years. After doing a variety of jobs around France he started to write articles until beginning to write his books. In the sources I used the definition of the Russian Revolution is â€Å"Russian Revolution, violent upheaval in Russia in 1917 that overthrew the czars government.† In the novel the rebellion of the animals was a violent upheaval on Manor Farm that overthrew Mr. Jones. Orwell’s point in writing this novel was to show the stupidity and flaws of the Russian government and the stupidity of the events that took place in the time period of the rise of communism. The main events that happen in the novel go word for word to what major events took place during Porter 2 the rise of Joseph Stalin. In the Russian Revolution Joseph Stalin took the words of the beloved Karl Marks and used them to gain power for his own doing. The same thing happened in Animal Farm when Napoleon used the words of Old Major to start his own Revolution. George Orwell’s Animal Farm is a story about rebellion. The farm animals rebel against Mr. Jones, the farm owner, because of neglect. When the animals chase out Mr. and Mrs. Jones, the animals immediately rejoice. The pigs gain control of the farm. They soon forget the real meaning of â€Å"Animalism† and the other animals cannot tell the difference between the humans and the pigs. Orwell’s Animal Farm parallels the characters, events, and socialism of the Russian Revolution. The characters in Animal Farm favor the main personalities of the Russian Revolution. Mr. Jones is a reflection of Czar Nicholas II, who lost control of his reign by rapid industrialization. The rebellion in the novel mirrors the R ussian revolution. The windmill is a symbol for Stalin’s Five-Year plan. Just a windmill was promised to make the animal’s life easier. The Five-Year Plan was supposed to improve Soviet industry to the point that the people’s life would be made easier. Stalin also thought that the Five Year Plan would increase production and allow the soviets to shorten the workweek. And just like the windmill, and Stalin’s plan was an utter failure. After the destruction of the Windmill, the Animals decided to build another one. Just like how Stalin kept churning out new Five-year Plans. Always promising that each new plan would solve all of Russia’s problems. The same as Porter 3  when Napoleon kept on making up plans that would benefit him in the long run. It all started when the hens refused to give their eggs up to the pigs. Napoleon then decided to starve them until they change their minds. Several of the hen’s die, and the rest simply give up. Soon after, Napoleon calls a general meeting. The dogs drag out several pigs. The pigs confess that they were working with Snowball and Mr. Frederick, and a moment later the dogs tear their throats out. After that, the same thing happens with the surviving hens from the rebellion. At the end, there is a pile of corpses by Napoleons feet. What we have here is a nightmare that mirrors to the Great Purge. The Great Purge took place between 1936 and 1938. Working to eliminate every last trace of the people Stalin had executed or sent to Gulag labor camps. Many of those who died, died because they claimed association with Leon Trotsky. Estimates of how many died in the purges ranges from about 500,000 up to 2 million. Stalin and Napoleon were evil men. Orwell was a very clever man. He had a lot of ideas on how government should be run. He also was a very talented writer. Using those skills he crafted the novel our class read Animal Farm. This novel could be read at an elementary level or at a high school level with a huge political perspective. Orwell cleverly used the story of animals taking over a farm to make fun of the communist government. In doing so he included the events as told in my past paragraphs. The Russian Revolution, Stalin’s Five-Year Plan, and The Great Purge. All events secretly mentioned in the form of a children’s fable. Orwell was truly a clever man.