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LETTER OF TRANSMITTAL
1st
June, 2011
Sir Prof. Dr. M.M.H. Siddiqi
Course Instructor, Global Business
Dadabhoy Institute of Higher Education
Karachi.
Sir
I here with present our Chapter Report authorized by you as a requirement for this
course.
In this report, I have tried to given the explanation of each topic in some detail.
I hope I have covered all that was required for the report.
If there be any clarification demanded, I would appreciate a call from you.
Sincerely,
Notan Khatri (BBA-8)
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Political System
A political system is a system ofpolitics and government. It is usually compared to the
legal system, economic system, cultural system, and other social systems. It is different
from them, and can be generally defined on a spectrum from left, e.g. communism, to theright, e.g. fascism. However, this is a very simplified view of a much more complex
system of categories involving the views: who should have authority, how religious
questions should be handled, and what the government's influence on its people and
economy should be.
"INDIVIDUALISM: The term 'individualism' has a great variety of meanings in social
and political philosophy. There are at least three types that can be distinguished: (1)
ontological individualism, (2) methodological individualism, and (3) moral or political
individualism. Ontological individualism is the doctrine that social reality consists,
ultimately, only of persons who choose and act. Collectives, such as a social class, state,
or a group, cannot act so they are not considered to have a reality independent of the
actions of persons. Methodological individualists hold that the only genuinely scientific
propositions in social science are those that can be reduced to the actions, dispositions,
and decisions of individuals. Political or moral individualism is the theory that
individuals should be left, as far as possible, to determine their own futures in economic
and moral matters.
COLLECTIVISM: Collectivism is defined as the theory and practice that makes some
sort of group rather than the individual the fundamental unit of political, social, and
economic concern. In theory, collectivists insist that the claims of groups, associations, or
the state must normally supersede the claims of individuals."
http://en.wikipedia.org/wiki/Systemhttp://en.wikipedia.org/wiki/Politicshttp://en.wikipedia.org/wiki/Governmenthttp://en.wikipedia.org/wiki/Legal_systemhttp://en.wikipedia.org/wiki/Economic_systemhttp://en.wikipedia.org/wiki/Cultural_systemhttp://en.wikipedia.org/wiki/Social_systemhttp://en.wikipedia.org/wiki/Social_systemhttp://en.wikipedia.org/wiki/Cultural_systemhttp://en.wikipedia.org/wiki/Economic_systemhttp://en.wikipedia.org/wiki/Legal_systemhttp://en.wikipedia.org/wiki/Governmenthttp://en.wikipedia.org/wiki/Politicshttp://en.wikipedia.org/wiki/System8/3/2019 National Differences in Political Economy
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SOCIALISM: is an economic system in which the means of production are publicly or
commonly owned and controlled co-operatively, or a political philosophy advocating
such a system. As a form of social organization, socialism is based on co-operative social
relations and self-management; relatively equal power-relations and the reduction or
elimination of hierarchy in the management of economic and political affairs.
Socialism is an economic system based upon production for use and the direct allocation
of economic inputs to satisfy economic demands and human needs (Use-value);
accounting is based on physical quantities of resources, some physical magnitude, or a
direct measure oflabor-time. Goods and services for consumption are distributed through
markets, and distribution of income is based on the principle of individual
merit/individual contribution.
As a political movement, socialism includes a diverse array of political philosophies,
ranging from reformism to revolutionary socialism.State socialistcurrents of socialism
advocate for the nationalization of the means of production, distribution and exchange as
a strategy for implementing socialism; while social democrats advocate public control of
capital within the framework of a market economy.Libertarian socialists and anarchists
reject using the state to build socialism, arguing that socialism will, and must, arise
spontaneously. They promote direct worker-ownership of the means of production
alternatively through independent syndicates, workplace democracies, or worker
cooperatives.
Modern socialism originated from an 18th-century intellectual and working class political
movement that criticized the effects ofindustrialization and private property on society.
Utopian socialists such as Robert Owen (17711858), tried to found self-sustaining
communes by secession from a capitalist society. Henri de Saint Simon (17601825),
who coined the term socialism, advocated technocracy and industrial planning. Saint-
Simon, Friedrich Engels and Karl Marx advocated the creation of a society that allows
for the widespread application of modern technology to rationalize economic activity by
eliminating the anarchy of capitalist production that results in instability and cyclical
crises ofoverproduction.
http://en.wikipedia.org/wiki/Economic_systemhttp://en.wikipedia.org/wiki/Means_of_productionhttp://en.wikipedia.org/wiki/Public_ownershiphttp://en.wikipedia.org/wiki/Common_ownershiphttp://en.wikipedia.org/wiki/Political_philosophyhttp://en.wikipedia.org/wiki/Self-managementhttp://en.wikipedia.org/wiki/Economic_systemhttp://en.wikipedia.org/wiki/Production_for_usehttp://en.wikipedia.org/wiki/Use-valuehttp://en.wikipedia.org/wiki/Calculation_in_kindhttp://en.wikipedia.org/wiki/Time-based_currencyhttp://en.wikipedia.org/wiki/Meritocracyhttp://en.wikipedia.org/wiki/Meritocracyhttp://en.wikipedia.org/wiki/To_each_according_to_his_contributionhttp://en.wikipedia.org/wiki/Political_movementhttp://en.wikipedia.org/wiki/Reformismhttp://en.wikipedia.org/wiki/Revolutionary_socialismhttp://en.wikipedia.org/wiki/State_socialisthttp://en.wikipedia.org/wiki/State_socialisthttp://en.wikipedia.org/wiki/Nationalisationhttp://en.wikipedia.org/wiki/Social_democracyhttp://en.wikipedia.org/wiki/Economic_interventionismhttp://en.wikipedia.org/wiki/Market_economyhttp://en.wikipedia.org/wiki/Libertarian_socialismhttp://en.wikipedia.org/wiki/Anarchismhttp://en.wikipedia.org/wiki/Central_governmenthttp://en.wikipedia.org/wiki/Syndicalismhttp://en.wikipedia.org/wiki/Workplace_democracyhttp://en.wikipedia.org/wiki/Worker_cooperativehttp://en.wikipedia.org/wiki/Worker_cooperativehttp://en.wikipedia.org/wiki/Working_classhttp://en.wikipedia.org/wiki/Political_movementhttp://en.wikipedia.org/wiki/Political_movementhttp://en.wikipedia.org/wiki/Industrialisationhttp://en.wikipedia.org/wiki/Private_propertyhttp://en.wikipedia.org/wiki/Utopian_socialismhttp://en.wikipedia.org/wiki/Robert_Owenhttp://en.wikipedia.org/wiki/Henri_de_Saint_Simonhttp://en.wikipedia.org/wiki/Technocracy_%28bureaucratic%29http://en.wikipedia.org/wiki/Friedrich_Engelshttp://en.wikipedia.org/wiki/Karl_Marxhttp://en.wikipedia.org/wiki/Anarchyhttp://en.wikipedia.org/wiki/Overproductionhttp://en.wikipedia.org/wiki/Overproductionhttp://en.wikipedia.org/wiki/Anarchyhttp://en.wikipedia.org/wiki/Karl_Marxhttp://en.wikipedia.org/wiki/Friedrich_Engelshttp://en.wikipedia.org/wiki/Technocracy_%28bureaucratic%29http://en.wikipedia.org/wiki/Henri_de_Saint_Simonhttp://en.wikipedia.org/wiki/Robert_Owenhttp://en.wikipedia.org/wiki/Utopian_socialismhttp://en.wikipedia.org/wiki/Private_propertyhttp://en.wikipedia.org/wiki/Industrialisationhttp://en.wikipedia.org/wiki/Political_movementhttp://en.wikipedia.org/wiki/Political_movementhttp://en.wikipedia.org/wiki/Working_classhttp://en.wikipedia.org/wiki/Worker_cooperativehttp://en.wikipedia.org/wiki/Worker_cooperativehttp://en.wikipedia.org/wiki/Workplace_democracyhttp://en.wikipedia.org/wiki/Syndicalismhttp://en.wikipedia.org/wiki/Central_governmenthttp://en.wikipedia.org/wiki/Anarchismhttp://en.wikipedia.org/wiki/Libertarian_socialismhttp://en.wikipedia.org/wiki/Market_economyhttp://en.wikipedia.org/wiki/Economic_interventionismhttp://en.wikipedia.org/wiki/Social_democracyhttp://en.wikipedia.org/wiki/Nationalisationhttp://en.wikipedia.org/wiki/State_socialisthttp://en.wikipedia.org/wiki/Revolutionary_socialismhttp://en.wikipedia.org/wiki/Reformismhttp://en.wikipedia.org/wiki/Political_movementhttp://en.wikipedia.org/wiki/To_each_according_to_his_contributionhttp://en.wikipedia.org/wiki/Meritocracyhttp://en.wikipedia.org/wiki/Meritocracyhttp://en.wikipedia.org/wiki/Time-based_currencyhttp://en.wikipedia.org/wiki/Calculation_in_kindhttp://en.wikipedia.org/wiki/Use-valuehttp://en.wikipedia.org/wiki/Production_for_usehttp://en.wikipedia.org/wiki/Economic_systemhttp://en.wikipedia.org/wiki/Self-managementhttp://en.wikipedia.org/wiki/Political_philosophyhttp://en.wikipedia.org/wiki/Common_ownershiphttp://en.wikipedia.org/wiki/Public_ownershiphttp://en.wikipedia.org/wiki/Means_of_productionhttp://en.wikipedia.org/wiki/Economic_system8/3/2019 National Differences in Political Economy
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Socialists inspired by the Soviet model of economic development, such as Marxist-
Leninists, have advocated the creation of centrally planned economies directed by a
single-party state that owns the means of production. Others, including Yugoslavian,
Hungarian, East German and Chinese communist governments in the 1970s and 1980s,
instituted various forms ofmarket socialism, combining co-operative and state ownership
models with the free market exchange and free price system (but not free prices for the
means of production).
COMMUNISM: is a sociopolitical movement that aims for a classless and stateless
society structured upon common ownership of the means of production, free access to
articles of consumption, and the end of wage labor and private property in the means of
production and real estate.
In Marxist theory, communism is a specific stage of historical development that
inevitably emerges from the development of the productive forces that leads to a
superabundance of material wealth, allowing for distribution based on need and social
relations based on freely-associated individuals. The exact definition of communism
varies, and it is often mistakenly, in general political discourse, used interchangeably
with socialism; however, Marxist theory contends that socialism is just a transitional
stage on the road to communism. Leninists revised this theory by introducing the notion
of a vanguard party to lead the proletarian revolution and to hold all political power after
the revolution, 'in the name of the workers' and supposedly with worker participation, in a
transitional stage between capitalism and socialism.
Communists such as council communists and non-Marxist libertarian communists and
anarcho-communists, as well as some Marxist-Leninists who have progressively
abandoned many of the basic assumptions of Leninism, oppose the idea of a vanguard
party and a transition stage, and advocate for the construction of full communism to
begin immediately upon the abolition of capitalism. There is a very wide range of
theories amongst those particular communists in regards to how to build the types of
institutions that would replace the various economic engines (such as food distribution,
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education, and hospitals) as they exist under capitalist systems or even whether to do
so at all.
SOCIAL DEMOCRACY: is a political ideology of the center-left on the political
spectrum. The contemporary social democratic movement seeks to reform capitalism to
align it with the ethical ideals of social justice while maintaining the capitalist mode of
production, as opposed to creating an alternative socialist economic system. Practical
modern social democratic policies include the promotion of a welfare state, and the
creation ofeconomic democracy as a means to secure workers' rights.
Historically, social democracy was a form ofevolutionary reformist socialism.[2]During
the early 20th century, major European social democratic parties began to reject elements
ofMarxism, Revolutionary socialism and class struggle, taking a moderate position that
socialism could be established through political reforms.
PRIVATIZATION: is the incidence or process of transferring ownership of a business,
enterprise, agency or public service from the public sector (the state or government) to
the private sector (businesses that operate for a private profit) or to private non-profit
organizations. In a broader sense, privatization refers to transfer of any government
function to the private sector - including governmental functions like revenue collection
and law enforcement.
The term "privatization" also has been used to describe two unrelated transactions. The
first is a buyout, by the majority owner, of all shares of a public corporation or holding
company's stock, privatizing a publicly traded stock, and often described as private
equity. The second is a demutualization of a mutual organization or cooperative to form a
joint stock company.
DEMOCRACY: is a form of government in which all citizens have an equal say in the
decisions that affect their lives. Ideally, this includes equal (and more or less direct)
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participation in the proposal, development and passage of legislation into law. It can also
encompass social, economic and cultural conditions that enable the free and equal
practice ofpolitical self-determination. The term comes from the Greek:
(dmokrata) "rule of the people", which was coined from (dmos) "people" and
(Kratos) "power", in the middle of the 5th-4th century BC to denote the political
systems then existing in some Greek city-states, notably Athens following a popular
uprising in 508 BC.
TOTALITARIANISM: (or totalitarian rule) is a political system where the state, usually
under the power of a single political person, faction, or class, recognizes no limits to its
authority and strives to regulate every aspect of public and private life wherever feasible.
Totalitarianism is usually characterized by the coincidence of authoritarianism (where
ordinary citizens have less significant share in state decision-making) and ideology (a
pervasive scheme of values promulgated by institutional means to direct most if not all
aspects of public and private life).
Totalitarian regimes or movements stay in political power through an all-encompassing
propaganda disseminated through the state-controlled mass media, a single party that is
often marked by personality cultism, control over the economy, regulation and restrictionofspeech, mass surveillance, and widespread use ofstate terrorism
REPRESENTATIVE DEMOCRACY: is a form of government founded on the principle
of elected individuals representing the people, as opposed to autocracy and direct
democracy. Two countries which use representative democracy are the United Kingdom
(a constitutional monarchy) and Germany (a federal republic).
It is an element of both the parliamentary system and presidential system ofgovernment
and is typically used in a lower chamber such as the House of Commons (UK) or
Bundestag (Germany), and is generally curtailed by constitutional constraints such as an
independent judiciary or an upper chamber.
http://en.wikipedia.org/wiki/Political_freedomhttp://en.wikipedia.org/wiki/Greek_languagehttp://en.wikipedia.org/wiki/Political_systemshttp://en.wikipedia.org/wiki/Political_systemshttp://en.wikipedia.org/wiki/Classical_Athenshttp://en.wikipedia.org/wiki/508_BChttp://en.wikipedia.org/wiki/Political_systemhttp://en.wikipedia.org/wiki/Authoritarianismhttp://en.wikipedia.org/wiki/Ideologyhttp://en.wikipedia.org/wiki/Regimeshttp://en.wikipedia.org/wiki/Political_powerhttp://en.wikipedia.org/wiki/Propagandahttp://en.wikipedia.org/wiki/Mass_mediahttp://en.wikipedia.org/wiki/Single-party_statehttp://en.wikipedia.org/wiki/Personality_culthttp://en.wikipedia.org/wiki/Planned_economyhttp://en.wikipedia.org/wiki/Restrictionhttp://en.wikipedia.org/wiki/Freedom_of_speechhttp://en.wikipedia.org/wiki/Mass_surveillancehttp://en.wikipedia.org/wiki/State_terrorismhttp://en.wikipedia.org/wiki/Form_of_governmenthttp://en.wikipedia.org/wiki/Autocracyhttp://en.wikipedia.org/wiki/Direct_democracyhttp://en.wikipedia.org/wiki/Direct_democracyhttp://en.wikipedia.org/wiki/United_Kingdomhttp://en.wikipedia.org/wiki/Constitutional_monarchyhttp://en.wikipedia.org/wiki/Germanyhttp://en.wikipedia.org/wiki/Federal_republichttp://en.wikipedia.org/wiki/Parliamentary_systemhttp://en.wikipedia.org/wiki/Presidential_systemhttp://en.wikipedia.org/wiki/Form_of_governmenthttp://en.wikipedia.org/wiki/House_of_Commonshttp://en.wikipedia.org/wiki/Bundestaghttp://en.wikipedia.org/wiki/Bundestaghttp://en.wikipedia.org/wiki/House_of_Commonshttp://en.wikipedia.org/wiki/Form_of_governmenthttp://en.wikipedia.org/wiki/Presidential_systemhttp://en.wikipedia.org/wiki/Parliamentary_systemhttp://en.wikipedia.org/wiki/Federal_republichttp://en.wikipedia.org/wiki/Germanyhttp://en.wikipedia.org/wiki/Constitutional_monarchyhttp://en.wikipedia.org/wiki/United_Kingdomhttp://en.wikipedia.org/wiki/Direct_democracyhttp://en.wikipedia.org/wiki/Direct_democracyhttp://en.wikipedia.org/wiki/Autocracyhttp://en.wikipedia.org/wiki/Form_of_governmenthttp://en.wikipedia.org/wiki/State_terrorismhttp://en.wikipedia.org/wiki/Mass_surveillancehttp://en.wikipedia.org/wiki/Freedom_of_speechhttp://en.wikipedia.org/wiki/Restrictionhttp://en.wikipedia.org/wiki/Planned_economyhttp://en.wikipedia.org/wiki/Personality_culthttp://en.wikipedia.org/wiki/Single-party_statehttp://en.wikipedia.org/wiki/Mass_mediahttp://en.wikipedia.org/wiki/Propagandahttp://en.wikipedia.org/wiki/Political_powerhttp://en.wikipedia.org/wiki/Regimeshttp://en.wikipedia.org/wiki/Ideologyhttp://en.wikipedia.org/wiki/Authoritarianismhttp://en.wikipedia.org/wiki/Political_systemhttp://en.wikipedia.org/wiki/508_BChttp://en.wikipedia.org/wiki/Classical_Athenshttp://en.wikipedia.org/wiki/Political_systemshttp://en.wikipedia.org/wiki/Political_systemshttp://en.wikipedia.org/wiki/Greek_languagehttp://en.wikipedia.org/wiki/Political_freedom8/3/2019 National Differences in Political Economy
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THEOCRACY: is a form of government in which a state is understood as governed by
immediate divine guidance especially a state ruled by clergy, or by officials who are
regarded as divinely guided.
From the perspective of the theocratic government, "God himself is recognized as the
head" of the state, hence the termtheocracy, from the Greek "rule of God", a
term used by Josephus of the kingdoms of Israel and Judah. Theocratic governments
enact theonomic laws (rules).
A theocracy may be monist in form, where the administrative hierarchy of the
government is identical with the administrative hierarchy of the religion, or it may have
two 'arms,' but with the state administrative hierarchy subordinate to the religious
hierarchy.
Theocracy should be distinguished from other secular forms of government that have a
state religion, or are merely influenced by theological or moral concepts, and monarchies
held "By the Grace of God".
Tribal Totalitarianism
A third form of totalitarianism is the tribal totalitarianism This exists principally in African countries, such as Zimbabwe, Tanzania,
Uganda, & Kenya Tribal totalitarianism occurs when a political party that represents the interests of
a particular tribe monopolizes power.
Right-Wing Totalitarianism
Here, private ownership of property is endorsed by government, market forces arealso allowed free play, but political freedom are rarely granted
Argentina, Brazil, Chile, & Paraguay were under right-wing totalitariangovernments in the 1980s
China is classic example of polity which though communist by definition, ispursuing right-wing policies
The country is privatizing state-owned enterprises, attracting FDI, pursuing pro-business policies & is registering a hefty growth rate
The country appears to be an open & free society, but is essentially totalitarian
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As between democracy & totalitarianism, which political system is ideal forbusiness growth is a relevant question?
It may be stated that democracy does not guarantee high rates of economicgrowth, nor does totalitarianism drive a country to slow economic growth
Rate of growth the increase in the amount of goods & services produced by anationis influenced by many variables other than political & civil liberties
ECONOMIC SYSTEM
An economic system is the structure of production, allocation of economic inputs,
distribution of economic outputs, and consumption ofgoods and services in an economy.
It is a set ofinstitutions and their social relations. Alternatively, it is the set of principles
by which problems ofeconomics are addressed, such as the economic problem ofscarcity
through allocation of finite productive resources.
An economic system is composed ofpeople and institutions, including their relationships
to productive resources, such as through the convention of property. Examples of
contemporary economic systems include capitalist systems, socialist systems, and mixed
economies. "Economic systems" is the economics category that includes the study of
respective systems.
Market Economy
In a market economy, national and state governments play a minor role. Instead,
consumers and their buying decisions drive the economy. In this type of economic
system, the assumptions of the market play a major role in deciding the right path for acountrys economic development.
Market economies aim to reduce or eliminate entirely subsidies for a particular industry,
the pre-determination of prices for different commodities, and the amount of regulation
controlling different industrial sectors.
The absence of central planning is one of the major features of this economic system.
Market decisions are mainly dominated by supply and demand. The role of the
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government in a market economy is to simply make sure that the market is stable enough
to carry out its economic activities properly.
Planned Economy
A planned economy is also sometimes called a command economy. The most important
aspect of this type of economy is that all major decisions related to the production,
distribution, commodity and service prices, are all made by the government.
The planned economy is government directed, and market forces have very little say in
such an economy. This type of economy lacks the kind of flexibility that is present a
market economy, and because of this, the planned economy reacts slower to changes in
consumer needs and fluctuating patterns of supply and demand.
On the other hand, a planned economy aims at using all available resources for
developing production instead of allotting the resources for advertising or marketing.
Mixed Economy
A mixed economy combines elements of both the planned and the market economies in
one cohesive system. This means that certain features from both market and planned
economic systems are taken to form this type of economy. This system prevails in many
countries where neither the government nor the business entities control the economicactivities of that country - both sectors play an important role in the economic decision-
making of the country. In a mixed economy there is flexibility in some areas and
government control in others. Mixed economies include both capitalist and socialist
economic policies and often arise in societies that seek to balance a wide range of
political and economic views.
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LEGAL SYSTEM
The legal system of a country refers to the rules or laws, that regulate behavior along with
the processes by which the laws are enforced and through which redress for grievances is
obtained. The legal system of a country is of immense importance to internationalbusiness. A countrys laws regulate business practice, define the manner in which
business transactions are to be executed, and set down the rights and obligations of those
involved in business transactions. The legal environments of countries differ in
significant ways. As we shall see, differences in legal systems can affect the
attractiveness of a country as an investment site or market.
Different Legal Systems
COMMON LAW: This system developed from a set of traditional laws first brought
together in England around the 12th Century. The name derives from the fact that it was
one set of laws "common" to the whole kingdom, rather than different sets of laws used
by individual communities or tribes.
One of the distinguishing features of common law is that it developed through usage
rather than being imposed by codified legislation as with the civil code system.
(Legislation means laws - sometimes also called statutes - that are made by a
representative body such as a parliament. Codification is when individual laws of a
similar nature are bundled together under one new, overarching law.)
Common law developed based on the outcomes of individual court cases. Each court case
provided a basis for judging the next case of a similar nature. Over the centuries and
many thousands of court cases, this process led to a body of laws covering most aspects
of society and based on principles shared by the society in general.
There are several core principles which guide common law, though they are not
necessarily unique to it. These include:1. The rights of the individual exist alongside those of the state;2. It is adversarial;3. It has a presumption of innocence;4. It develops case law through judgments and precedents;5. Case law co-exists with statute law and - in most cases - a constitution;6. Crimes are punished and civil wrongs are rectified by compensation.
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CIVIL LAW: (or civilian law) is a legal system inspired by Roman law, the primary
feature of which is that laws are written into a collection, codified, and not (as in common
law) interpreted by judges.
Conceptually, it is the group of legal ideas and systems ultimately derived from the Code
of Justinian, but heavily overlaid by Germanic, ecclesiastical, feudal, and local
practices,[2]as well as doctrinal strains such as natural law, codification, and legislative
positivism.
Materially, civil law proceeds from abstractions, formulates general principles, and
distinguishes substantive rules from procedural rules.[3]
It holds legislation as the primary
source of law, and the court system is usually inquisitorial, unbound by precedent, and
composed of specially trained judicial officers with a limited authority to interpret law.
Juries separate from the judges are not used, although in some cases, volunteer lay judges
participate along with legally trained career judges.
THEOCRATIC LAW OR RELIGIOUS LAW: Here we are not talking of laws governing
the religious practices of believers but of a country's legal system being based on
religious laws which apply to people as citizens in both their private and public lives.
Although throughout history many countries have had legal systems based wholly or
partly on religious laws and teachings, today by far the most common are those aligned to
Islam.
Islamic law (Sharia) is based on the Koran and Sunnah holy books, supplemented by
interpretations over the centuries by Muslim scholars and jurists. It provides rules on how
practicing Muslim should live their lives. Like common law and civil code law, Islamic
law is still evolving and there are still disagreements about exactly what makes up Sharia
and its scholarly interpretations (Fiqh).
Islamic law shares some similarities with common law, principally the fact that it has
evolved through application, with current judgments based on precedents and the analysis
of previous cases of a similar nature. There are, however, some fundamental differences
in areas such as individual rights and equality before the law, especially in the treatment
of women.
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CONTRACT: is a legally enforceable agreement between two or more parties with
mutual obligations. The remedy at law for breach of contract is "damages" or monetary
compensation. In equity, the remedy can be specific performance of the contract or an
injunction. Both remedies award the damaged party the "benefit of the bargain" or
expectation damages, which are greater than mere reliance damages, as in promissory
estoppels.
A contractual relationship is evidenced by (1) an offer, (2) acceptance of the offer, and a
(3) valid (legal and valuable) consideration. Each party to a contract acquires rights and
duties relative to the rights and duties of the other parties. However, while all parties may
expect a fair benefit from the contract (otherwise courts may set it aside as inequitable) it
does not follow that each party will benefit to an equal extent. Existence of contractual-
relationship does not necessarily mean the contract is enforceable, or that it is not void
(see void contract) or voidable (see voidable Contract). Contracts are normally
enforceable whether or not in a written form, although a written contract protects all
parties to it. Some contracts, (such as for sale of real property, installment plans, or
insurance policies) must be in writing to be legally binding and enforceable. Other
contracts (see implied in fact contract and implied in law contract) are assumed in, and
enforced by, law whether or not the involved parties desired to enter into a contract.
CONTRACT LAW: Blacks Law Dictionary defines a contract as [a]n agreement
between two or more parties creating obligations that are enforceable or otherwise
recognizable at law. Forpurposes of this chapter, we are concerned with agreements to
buy and sell some type of agricultural product.
Contract law lies at the heart of our system of laws and serves as the foundation of our
entire society. This is not an exaggeration. It is a simple observation - one that too often
goes unobserved.
Our society depends upon free exchange in the marketplace at every level. Contract law
makes this possible. Exchanges in the marketplace always depend upon voluntary
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agreements between individuals or other "legal persons". Such voluntary agreements
could never work without contract law.
Contract law serves to make these agreements "enforceable", which usually means that it
allows one party to a contract to obtain money damages from the other party upon
showing that the latter stands in breach.
Without contract law, these voluntary agreements would instantly become impractical
and unworkable. Since such agreements lie at the very heart of our society and economy,
and since they depend upon contract law, it is no exaggeration to say, as I have just done,
that "contract law lies at the heart of our system of laws and serves as the foundation of
our entire society." Those were the very words that I used to begin this essay.
UNITED NATIONS CONVENTION ON CONTRACTS FOR THE INTERNATIONAL
SALE OF GOODS (CIGS): The United Nations Convention on Contracts for the
International Sale of Goods (CISG) has been recognized as the most successful attempt to
unify a broad area of commercial law at the international level. The self-executing treaty
aims to reduce obstacles to international trade, particularly those associated with choice
of law issues, by creating even-handed and modern substantive rules governing the rights
and obligations of parties to international sales contracts. At the time this is written
(February 2009), the CISG has attracted more than 70 Contracting States that account for
well over two thirds of international trade in goods, and that represent extraordinary
economic, geographic and cultural diversity.
CIGS addressing the following matters
Interpretation of the parties agreement; The role of practices established between the parties, and of international usages; The features, duration and revocability of offers; The manner, timing and effectiveness of acceptances of offers; The effect of attempts to add or change terms in an acceptance; Modifications to international sales contracts; The sellers obligations with respect to the quality of the goods as well as the time
and place for delivery;
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The place and date for payment; The buyers obligations to take delivery, to examine delivered goods, and to give
notice of any claimed lack of conformity;
The buyers remedies for breach of contract by the seller, including rights todemand delivery, to require repair or replacement of non-conforming goods, to
avoid the contract, to recover damages, and to reduce the price for non-
conforming goods;
The sellers remedies for breach of contract by the buyer, including rights torequire the buyer to take delivery and/or pay the price, to avoid the contract, and
to recover damages;
Passing of risk in the goods sold; Anticipatory breach of contract; Recovery of interest on sums in arrears; Exemption from liability for failure to perform, including force majeure; Obligations to preserve goods that are to be sent or returned to the other party.
PROPERTY RIGHTS AND CORRUPTION: Laws created by governments in regards
to how individuals can control, benefit from and transfer property. Economic theory
contends that government enforcement of strong property rights is a determinant
regarding the level of economic success seen in the area. Individuals will create new
forms of property to generate wealth, only when they are assured that their rights to
their property will protect them against unjust and/or unlawful actions by other parties.
CORRUPTION:affects all regions of the world and all levels of society, but the impact is
greatest in developing countries. Every year, developing countries lose USD 50 million to
100 million through corrupt acts (World Bank estimate, 2004).
Corruption undermines political, social and economic stability and damages trust in
institutions and authorities. It also fuels transnational crime. Terrorists and organized
criminals are aided in their illegal activities by the complicity of corrupt public officials.
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Corruption is of particular concern for the worlds police and judicial systems, as
corruption in one country can compromise an entire international investigation.
There is clear recognition by the international community that further work to enhance
co-operation between law enforcement authorities is needed in order to co-ordinate
global action against corruption.
Figure 2.1: Rankings of Corruption by Country
2004
0 2 4 6 8 10
Bangladesh
Nigeria
Indonesia
Zimbabwe
Russia
India
China
Brazil
Italy
Malaysia
France
United States
United Kingdom
New Zeland
Finland
Corruption Index (10=clean; 0=totally corrupt)
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The protection of intellectual property
INTELLECTUAL PROPERTY: is the Creations of the mind, such as inventions, literary
and artistic works, and symbols, names, images, and designs.
PATENT: is a document that grants the holder exclusive rights to an invention for a fixed
number of years.
COPYRIGHT: is an exclusive grant from the government that allows the owner to
reproduce a work, in whole or in part, and to distribute, perform, or display it to the
public in any form or manner, including over Internet
Literary works Musical works Dramatic works Artistic works Sound recordings, films, broadcasts, cable programs
TRADEMARK: is a symbol used by businesses to identify their goods and services;
government registration of the trademark confers exclusive legal right to its use.
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Piracy of Intellectual Property
THE DETERMINANTS OF ECONOMIC DEVELOPMENT
GROSS NATIONAL INCOME (GNI): comprises the value within a country (i.e. its
gross domestic product), together with its income received from other countries (notably
interest and dividends), less similar payments made to other countries.[1]
The GNI consists of: the personal consumption expenditures, the gross private
investment, the government consumption expenditures, the net income from assets
abroad (net income receipts), and the gross exports of goods and services, after deducting
two components: the gross imports of goods and services, and the indirect business taxes.
The GNI is similar to the gross national product (GNP), except that in measuring the
GNP one does not deduct the indirect business taxes.
PURCHASING POWER PARITY (PPP): is a theory which states that exchange rates
between currencies are in equilibrium when their purchasing power is the same in each of
the two countries. This means that the exchange rate between two countries should equal
Figure 2.2: Regional Piracy Rates for Software
0 20 40 60 80
North America
Western Europe
Middle East and Africa
Latin America
Asia Pacific
Eastern Europe
Percentage of Software that is Pirated
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the ration of the two countries price level of a fixed basket of goods and services. When
a countrys domestic price level is increasing (i.e., a country experiences inflation), that
countrys exchange rate must depreciated in order to return to PPP.
HUMAN DEVELOPMENT INDEX (HDI): is a composite statistic used to rank
countries by level of "human development" and separate "very high human
development", "high human development", "medium human development", and "low
human development" countries. The Human Development Index (HDI) is a comparative
measure of life expectancy, literacy, education and standards of living for countries
worldwide. It is a standard means of measuring well-being, especially child welfare. It is
used to distinguish whether the country is a developed, a developing or an under-
developed country, and also to measure the impact of economic policies on quality of
life. There are also HDI for states, cities, villages, etc. by local organizations or
companies.
Countries fall into four broad human development categories, each of which comprises
42 countries (except for the second category, comprising 43 countries).[4]
The divisions
are:
Division comprising:
Very high 42 countries
High 43 countries
Medium 42 countries
Low 42 countries
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STATES IN TRANSITION
The spread of Democracy:
The spread of democracy. During the 1800's, democracy developed steadily. Many
countries followed the American and British examples. Such democratic institutions aselections and legislatures became common. Where kings still ruled, they lost much of
their power and performed mainly ceremonial duties.
The Industrial Revolution brought political changes of great importance. During the
second half of the 1800's, the working classes demanded and received greater political
rights. New laws gave more citizens the right to vote. The freedoms of speech, the press,
assembly, and religion were extended and enlarged.
Democracy did not take root everywhere. Some countries that adopted constitutions
modeled after that of the United States later became dictatorships. These nations found
that a constitution alone did not guarantee democracy. In Russia, a group of revolutionists
set up a Communist dictatorship in 1917 and halted Russia's progress toward democracy.
Germany adopted a democratic government in 1919, but Adolf Hitler's rise to power
brought a fascist dictatorship in 1933.
Democracy today. Most governments today claim to be democratic, but many lack some
essential freedoms usually associated with democracy. In some countries, for example,
the people are not allowed certain basic freedoms, such as those of speech and of the
press, or competitive elections.
The New World Order And Global Terrorism
International terrorism, particularly after the Sept. 11 attacks, the West finally attractedthe attention of the world, especially to combat international terrorism and the fight
began. Terrorist activities in the United States is the center of the world to take an easy
target to attack even if the share of the arrangement behind the crisis brought by
globalization undoubtedly enormous.
The name of the last century with an incredible evolution of technology and objectives of
terrorist organizations who want to announce, that they provide the means of mass
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communication facilities due to high blood anywhere in the world are performing their
activities.
Terrorism is a fact that todays conditions have been replaced by hot wars.
it is obvious that external sources sustain the existence of terrorism . In this case, the
states need to stop use of terrorist organizations for political purposes. That one or two
states
possibly can and that is not a war that one or two states can struggle with that issue.
International agreements and cooperations should act together rather than signing useless
agreements. In contrast when we consider the aims and methods of terrorist organizations
it is not far away unpreventable atrocities and high-effected attacks.
The Nature of Economic Transformation
DEREGULATION: is the removal or simplification of government rules and regulations
that constrain the operation of market forces.[1]
Deregulation does not mean elimination
of laws against fraud or property rights but eliminating or reducing government control of
how business is done, thereby moving toward a more laissez-faire, free market. It is
different from liberalization, where more players enter in the market, but continues the
regulation and guarantee of consumer rights and maximum and minimum prices. Anexample of Deregulation would be Financial Deregulation.
PRIVATIZATION: is the incidence or process of transferring ownership of a business,
enterprise, agency or public service from the public sector (the state or government) to
the private sector (businesses that operate for a private profit) or to private non-profit
organizations. In a broader sense, privatization refers to transfer of any government
function to the private sector - including governmental functions like revenue collection
and law enforcement.
The term "privatization" also has been used to describe two unrelated transactions. The
first is a buyout, by the majority owner, of all shares of a public corporation or holding
company's stock, privatizing a publicly traded stock, and often described as private
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equity. The second is a demutualization of a mutual organization or cooperative to form a
joint stock company.
LEGAL SYSTEM:of the world today are generally based on one of three basic systems:
civil law, common law, and religious lawor combinations of these. However, the legal
system of each country is shaped by its unique history (see State law), and so
incorporates individual variations.
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