Why gun laws are important to the U.S.A

As the only country that guns are legalized, the United States of America has given the liberty to its people to own guns in order to protect themselves in case of emergency. Hence, to own a gun is considered to be an American right to be a citizen of the U. S. A. This right was protected by The Second Amendment of the united States constitution, where It Is mentioned that people do have right to possess and use fire arms and ammunitions.However, in order to have restriction on gun owners, government has introduced Federal Gun Laws as well as the State laws for gun extraction, in comparison of two laws, the federal laws seemed to be completed and have more restrictions on the behavior of people, where as the state laws do vary from state to states, and most of the state laws are not too strict. Second Amendment, 2014) When the citizenry gain control on fire arms, the safety of the individual house hold tend to increase, in the detail paragraphs more will be discussed on the same topi c. Despite all the gun caused tragedies, I believe that gun possession should not be held responsible of death caused in the general public, as UN Is not the only tool that causes tragedy, therefore It Is merely a ways but not the solely cause. Further more, due to legalization of guns In the U. S. He sales of guns have always being a Income for the country, hence denying the right to own guns can be as bad as denying the Income of the government; In addition, some of the heavy industries that are mainly in to the production of firearms faces bankruptcy in times that the nation do not need that much of weapons; hence due the consumption abilities generated by the citizens of the United States of America(Annually overspent receives $6 billions estimated revenue on firearms etc), this country is not likely to be affected by situations as such.In other aspect the income can be positively maintained while avoiding such tragic situation. (Sunburn, J, 2012) There are plenty of reasons to encourage the Second Amendment of the United States of America, the fore and most important factor of legalization of guns Is to protect people sudden dangers and unexpected circumstances In which people will expose to dangers that can be as bad as ruling their lives while unable to do anything about it.The fundamental theory or ideology for this idea to thrive is that, it is not that everybody can get a body guard or a police man to stay with you 24, 7. Therefore, if a burglar broke into your house and was about to harm your family, and if you call the police, they would need time to come to you, but the problem is on their arrival it would be too late to save anybody, therefore if you possess a gun, it would mean a lot, at least you can scare off the burglar.Similarly, in this society, people may face different problems that may cause them to be mentally ill, hence hey might start a mass shooting scene, however, if other people could have guns with them, then they could stop the m ad man before he could hurt anyone. On the other hand, I do believe that firearms are not the fundamental cause of violence, because It Is not true that people can get killed only by guns, and gun Itself can not kill. Therefore, the orally of the violence Is not on fire weapons and ammunitions, but people.According too news published on Forbes in the year 201 3 Jan 1st by inappropriate. According to Swinger's analysis, the rights that are granted for the tizzies should not be denied because another one has committed a crime while using that right, because everyone of us is unique and would not lead a life of another existing living body, hence it is not Just and wrong for the government to intervene in such situation, as in a man's life the only thing that you can deprive him of is the liberty that he has, and rights are considered to be liberty.Secondly, Swanker also argued that a concealed pistol would do no harm to anybody around it, unless it is drawn and used, therefore if any one would own a gun for safety reposes, it is not an evidence that can be taken to charge the owner that he or she is going to committee a crime with that weapon. (Swanker, H, 2013) In addition to the benefits of gun legalization, the economy of the country can be maintained its statues which is lucrative to become even better. According to relevant studies done by P.Brad who has had written an article on Washington post, in the year 2012 the United States of America's gun industry expects a profit approximately $998 million to be deposited for the country, which really matters a lot or a country development. As a result, we can see that when possession, purchase and usage of firearms are declared to be constitute, the economy of the country would gradually expand, therefore I myself can not see any drawbacks may caused due to this decision by all means.Statically it is too proven that, out of 100% of the firearm products, 15% would belong to the law enforcement and 25% belong to th e military purposes, while other 60% of the market was distributed among the citizens in the USA, hence we are clear that citizens indeed need guns for their own retention, and at the same time the US government could also thrive. (P.Brad, 2012) In order to finish up with this assignment, I would like to emphasis again that the fundamental cause of legalization of gun is for the protection purpose of the individuals, as when they are exposed to urgent danger, and time would not be sufficient to wait for the police officer to arrive. Hence, it is very practical to own a gun to deal with such situations.However, I insist that firearms are tools for people to achieve certain deeds, and it can not kill or harm anybody by itself, in case that regarded may be caused by firearms, I believe that it is mainly caused by ill intentioned people, and it is the only situation that it may harm people. But though people may use guns to do crimes but guns are not responsible for such situation becau se the real wrongness is with people.In short, there are plenty of rights and benefits that worth preserve by encourage the legalization of firearms. Finally, I appeal that citizenry should not be blamed with others wrong doing, and gun possession is their right, which should not be denied or abandoned, as it is their right to protect!

The Toll of Stockholm Syndrome in the African American Society

â€Å"The Toll of Stockholm Syndrome in the African American Society† One of the effects of slavery on the African American people is the Stockholm syndrome. Stockholm syndrome by definition is the feelings of trust or affection felt in many cases of kidnapping or hostage-taking by a victim toward a captor. Another name used for this is the slave loyalty syndrome. Once slavery seemed to become a way of the world in America, some slaves grew forms of sympathy for their slave owners. While slavery became a way of life for slaves, some slave owners made their slaves feel a part of their family.On some plantations, there were slaves that could have been in the family for many years. Those slaves could have raised the owner, the owner’s parents, and the owner’s grandparents in turn may have gotten special treatment from the owners. Some owners confide in the family slaves, and those slaves did not see that they were being used for information. Those slaves may have fe lt that they are actually a part of their master’s family. Once feeling that they belonged, some slaves felt that they could be equal with their owners.By seeing the ways of the trade, some slaves wanted to own something of their own. Even though Stockholm syndrome by definition is a terrible thing, it evolved into the civil rights movement. All slaves who were affected by the Stockholm syndrome may not feel as if they were a part of the master’s family. They may have felt empathy as well as sympathy. There could have been things happening in the master’s house that gave slaves understanding. So instead of feeling like animals, the slaves related.They related to make them know that they deserved equal opportunities. The Stockholm syndrome affected the history of the African American people. Even though some slaves were the whistle blowers of the other slaves, there were some slaves that did feel a certain way towards their owners, but it encouraged other feeling s. Those feeling developed into justice and equality for all. Those slaves taught those beliefs to their children and their grandchildren which helped change not only African American history, but the entire American history. The Toll of Stockholm Syndrome in the African American Society â€Å"The Toll of Stockholm Syndrome in the African American Society† One of the effects of slavery on the African American people is the Stockholm syndrome. Stockholm syndrome by definition is the feelings of trust or affection felt in many cases of kidnapping or hostage-taking by a victim toward a captor. Another name used for this is the slave loyalty syndrome. Once slavery seemed to become a way of the world in America, some slaves grew forms of sympathy for their slave owners. While slavery became a way of life for slaves, some slave owners made their slaves feel a part of their family.On some plantations, there were slaves that could have been in the family for many years. Those slaves could have raised the owner, the owner’s parents, and the owner’s grandparents in turn may have gotten special treatment from the owners. Some owners confide in the family slaves, and those slaves did not see that they were being used for information. Those slaves may have fe lt that they are actually a part of their master’s family. Once feeling that they belonged, some slaves felt that they could be equal with their owners.By seeing the ways of the trade, some slaves wanted to own something of their own. Even though Stockholm syndrome by definition is a terrible thing, it evolved into the civil rights movement. All slaves who were affected by the Stockholm syndrome may not feel as if they were a part of the master’s family. They may have felt empathy as well as sympathy. There could have been things happening in the master’s house that gave slaves understanding. So instead of feeling like animals, the slaves related.They related to make them know that they deserved equal opportunities. The Stockholm syndrome affected the history of the African American people. Even though some slaves were the whistle blowers of the other slaves, there were some slaves that did feel a certain way towards their owners, but it encouraged other feeling s. Those feeling developed into justice and equality for all. Those slaves taught those beliefs to their children and their grandchildren which helped change not only African American history, but the entire American history.

Ethical Problems associated to Information Technology Essay

Information technology has been continuously booming with new technological products that create a more diverse information environment. There have been dramatic changes associated with the IT, and these changes create ethical problems and upheavals that usually have something to do with ethics. True, there has been technological development in the arena—one that occurs â€Å"when either the technological paradigm is elaborated in terms of improved concepts, theories, and methods, or in instances of the paradigm are improved† (Moor, 2008, p. 27), such as in terms of efficiency, effectiveness, and safety. This creates an enormous social impact, and it has led to a technological revolution that considerably takes time and is difficult to predict. Information technology has gone over the introduction stage and the permeation stage. We are on the power stage wherein the technology is readily available, affecting people directly and indirectly. This creates an impact that is superbly enormous; yet, there are always the ethical problems that springs forth in the arena. Ethical problems that surround the self-identity, anonymity, and privacy of a person are always attached when it comes to IT. The technological revolution has a large-scale effect that transforms the society, while affecting the manner in which the society functions (Moor, 2008, p. 29). It is evident that open technological revolutions in open societies still need some enhancements, so that the ethical problems would be controlled and maximized. Main Body There are a number of important issues that surround the technological paradigm of IT, especially in relation to ethics. Some of these are in the form of self-identity, anonymity, as well as privacy. There are also other unethical issues (e. g. , cheating, hacking, wardriving) that are attached to the technological paradigm of IT. Ethical problems in self-identity The self-identity is being constructed according to how the individual interacts with the society and with himself or herself. In the social landscape of modernity, there are numerous major changes in the external social environment that affects the individual during this social transformation. In the age of the IT, people get to have the capacity to reconstruct the universe through the everyday realities and circumstances that take place in their specific worlds. It is a continuous state of affairs that largely creates the self-identity and the personal feelings attached to this paradigm. This new sense of identity are being formed with the intrusion of the IT in a person’s life, and people get to have personal relationship even with people who are unknown to them—people who suddenly pop out in their computer’s screens, with names that may or may not be factual. Personal relationships help form the self-identity, offering opportunities for self-expression and the self-renewal. According to Giddens (1991), The modern world is a ‘runaway world’: not only is the pace of social change much faster than in any prior system, so also is its scope, and the profoundness with which it affects pre-existing social practices and modes of behavior. (Giddens, 1991, p. 16) With this, it is apparent that the IT becomes an active component in the continuous transformation of a person’s identity, as it creates and affects the social practices and the modes of a person’s behavior. Thus, problems that affect the personal life of the individual could affect not only the self-identity, but the social practices and the environment as a whole. Ethical problems in terms of anonymity and privacy, for example, can lead to an identity that is blemished because of unethical conduct. Despite the fact that people always carry discursive interpretations of their behavior, this practical consciousness drives the person into creating or destroying the ontological security of human activity in a culture. As an effect, people tend to write comments anonymously while hiding their true identities. Ethical problems in anonymity According to the article that Richard Perez-Pena (2010) wrote entitled ‘News Sites Rethink Anonymous Online Comments’, it says that Internet users usually make use of the digital disguise, revealing their power and their sentiments without acknowledging their true identities to the viewers. This constitutes a sort of freedom for the digital users, and this is most typical in news sites, wherein the viewers are allowed to post comments without indicating their true identities, keeping their privacy in a world that is being presented in public. As indicated in the article, â€Å"Anyone could weigh in and remain anonymous† (Perez-Pena, 2010, p. 1), and this leads to the question on whether or not viewers of Internet sites should be allowed to remain anonymous when dictating their comments and suggestions. This is a very significant ethical problem associated to IT, since it has been ethically accepted that any type of idea or sentiment should be associated to the respectful person who has formed the idea. According to Arianna Huffington, founder of The Huffington Post, Anonymity is just the way things are done. It’s an accepted part of the Internet, but there’s no question that people hide behind anonymity to make vile or controversial comments. (Perez-Pena, 2010, p. 1) It has, therefore, been advised that viewers should indicate their factual names, especially when making a significant commentary about the society. They should use their real names, and this may be done by requiring people to register first before posting their commentaries. Ethical problems in privacy According to the article that Scott Rosenberg (2010) wrote entitled ‘Online Comments Need Moderation, Not Real Names’, there is also the statement that defines how newspaper website managers have been reacting in terms of anonymity and privacy keeping. As stated, â€Å"If only they could make people sign their real names, surely the atmosphere would improve† (Rosenberg, 2010, p. 1). Online conversation spaces make media outlets turn the common software on and then leave them as it is, as if the discussions would â€Å"magically take care of themselves† (Rosenberg, 2010, p. 1). The problem, however, is that the commenters should not be faceless and should carry identities that are open for the other viewers. This problem is in the identity system, with the Web having no identity system that would ethically reconnect the idea to the person who has declared it. As stated in the article, The Web has no identity system, and though the FBI can track you down if the provocation is dire enough, and if you get editors mad enough they can track you down, too, most media companies aren’t going to waste the time and money. (Rosenberg, 2010, p. 1) Ethical privacy problems can also be in the form of ‘hacking’ or â€Å"using unauthorized access to an information system† (Floridi, 2008, p. 43). This indulges privacy and confidentiality. Conclusion There are other ethical problems associated with the IT of the modern social world, such as using the new technology in order to cheat one’s taxes, or deviating the user from his or her true name or identity. It can also be in the form of wardriving wherein people try to connect wirelessly to other people’s networks (Moor, 2008, p. 33). All these unethical conducts can create an enormous social impact that leads to technological revolution that can contract IT in its power stage. With proper management, it can develop the IT into something that is more powerful and enormous, without the ethical problems that have large-scale effects on the society. It is evident, therefore, that open societies through the IT still need some enhancements, so that the ethical problems would be controlled and maximized. References Floridi, L. (2008). Information ethics: its nature and scope. In Eds. Jeroen van den Hoven and John Weckert’s Information technology and moral philosophy. New York, NY: Cambridge University Press. Giddens, A. (1991). Modernity and self-identity: self and society in the late modern age. Stanford, CA: Stanford University Press. Moor, J. (2008). Why we need better ethics for emerging technologies. In Eds. Jeroen van den Hoven and John Weckert’s Information technology and moral philosophy. New York, NY: Cambridge University Press. Perez-Pena, R. (2010, April 11). News sites rethink anonymous online comments. Retrieved May 7, 2010, from The New York Times Company database: http://www. nytimes. com/2010/04/12/technology/12comments. html. Rosenberg, S. (2010, April 13). Online comments need moderation, not real names. Retrieved May 7, 2010, from Salon Media Group, Inc. database: http://www. salon. com/news/feature/2010/04/13/newspaper_online_comments_moderation_open2010.

Seeking Fulfillment Essay Example | Topics and Well Written Essays - 2750 words

Seeking Fulfillment - Essay Example This well is still in place to this day. Here, next to the forefather’s well met two people Christ and the Samaritan woman. These two figures embodied two different worlds - Jewish and Samaritan who mutually hated each other, although they had common roots. Pagans captured this territory around the 7th century BCE and intermarried with the indigenous inhabitants – Jews; thus forming a nation of Samaritans. From Scripture, they recognized only the Torah of Moses - the Torah. Along with God, Yahweh, they also recognize the pagan idols. The Jews saw them as half pagans and quarreled with them nearly incessantly. As a result of the ill-will harbored between these two people groups the Jews even denied them to participate in the construction of the Temple of Jerusalem. Accordingly, Samaritans built a separate temple on Mount Gerizim which served to only further and intensity the feud that had already lasted for around 600 years. In 107 BCE Maccabeus rebels destroyed the temp le; something the Samaritans Jews could not forgive. They spat toward each other from afar and considered touching each other with their own eyes as worse than touching any other impurity. â€Å"The Jews and the Samaritans were bitter enemies, and as far as possible avoided all dealing with each other. To trade with the Samaritans in case of necessity was indeed counted lawful by the rabbis; but all social intercourse with them was condemned. A Jew would not borrow from a Samaritan, nor receive a kindness, not even a morsel of bread or a cup of water. The disciples, in buying food, were acting in harmony with the custom of their nation. But beyond this they did not go. To ask a favor of the Samaritans, or in any way seek to benefit them, did not enter into the thought of even Christ's... According to the report findings the meeting of Christ and the Samaritan woman at Jacob’s well occurred at Samaritan territory near the town of Sychar. There was only one well, 32 meters deep, dug by Jacob, the father of the nation of Israel about fifteen hundred years before the birth of Christ. This well is still in place to this day. Here, next to the forefather’s well met two people Christ and the Samaritan woman. These two figures embodied two different worlds - Jewish and Samaritan who mutually hated each other, although they had common roots. Pagans captured this territory around the 7th century BCE and intermarried with the indigenous inhabitants – Jews; thus forming a nation of Samaritans. From Scripture, they recognized only the Torah of Moses - the Torah. Along with God, Yahweh, they also recognize the pagan idols. The Jews saw them as half pagans and quarreled with them nearly incessantly. This essay stresses that Samaritans built a separate temple on Mount Gerizim which served to only further and intensity the feud that had already lasted for around 600 years. In 107 BCE Maccabeus rebels destroyed the temple; something the Samaritans Jews could not forgive. They spat toward each other from afar and considered touching each other with their own eyes as worse than touching any other impurity. Therefore, by a careful examination of the historical background to the situation, it becomes clear why certain figures in the story behave in the way that they do.

Current Events and U.S. Diplomacy Research Paper - 1

Current Events and U.S. Diplomacy - Research Paper Example A president’s foreign policy can be thoroughly diplomatic, while his military stance can play merely the role of a diplomatic apparatus. It is normally determined by the country’s economic, military, and sociopolitical statuses. Whereas a presidential doctrine is usually objective-oriented, the implement of this doctrine needs in-depth knowledge of and proper response to home economy, politics, military strength, etc. Simultaneously the president should have in-depth knowledge of and proper response to counterparty’s economy, politics, military strength, etc. During the developing stage of the Cold War in the first half of the 1960s, John Fitzgerald Kennedy’s foreign policy had been more diplomatic than his predecessor Dwight Eisenhower’s unyielding view about the US presence in the world politics. The diplomatic essence of the Kennedy Doctrine initially played a crucial role in building up the very premises –â€Å"Flexible Response to the I nternational Political Powers†, â€Å"Containment of Communism† and â€Å"Reversal of Soviet Progress in the West† –of the Kennedy Doctrine. ... In this regard Gaddis (2005) opined that also the failed CIA-backed military coup in Cuba, in spite of Kennedy’s promise to refrain from Cuban Affairs, provoked the president to be bold to pronounce the United States’ defensive stance regarding the Berlin issue and the diplomatic acknowledgement of the Soviet Union’s concern in Germany. (Gaddis, 2005, pp. 112-115) Kennedy’s policy for the â€Å"containment of communism† was essentially the legacy of Eisenhower and Truman’s foreign policy prerogatives. During the peak-hours of Cold War, Kennedy had no other choice but to follow his â€Å"White House predecessors† (Schweizer, 1994, pp. 65). Being panicked by the rapid communist advancement, both Truman and Eisenhower turned back to the country’s military strength -though they did not go into any direct war- to contain communism. As a result, superpowers involved into proxy wars in various geographical regions of interests. Nuclear arm race between the two main parties of the war, the USA and the Soviet Union, began as a response to the superpowers’ desire to overpower each other. During the period, the world experienced a worldwide regrouping of the countries into the US block and the Soviet bloc. This regrouping in the Soviet block was mainly based on the Marxist political ideology of Communism, whereas capitalism and democratic interests dominated the countries in the US block. This regroupings in both of the blocks often turned into expansionism and counter-expansionism. (Schweizer, 1994, pp. 69-74) The Soviet leadership’s expansionist desire to force Marxist ideals upon the rest of the earth panicked the wealthy capitalist west whose reaction to the communist expansionism eventually

Building Information Modeling (BIM) For Sustainable Design Dissertation

Building Information Modeling (BIM) For Sustainable Design - Dissertation Example Introduction 29 5.2. Kiowa County School, Greensburg, Kansas 29 6. Results and Discussion 33 7. References 37 Building Information Modeling for Sustainable Design 1. Chapter One: Introduction 1.1. Impact of Building Construction on Environment Building construction is one of the oldest human activities on the earth. The proverb â€Å"necessity is the mother of invention† probably evoked in human talent for creating a controlled environment in order to moderate the effects of climate. Human beings constructed shelters to adapt themselves to a wide variety of climates (Encyclopedia of Britannica, n.d.). This is how emerged a new activity, which is called building construction. Centuries of development have established three principal characteristics of building construction; design, material, and comfort. The history of evolution of building construction has marked number of trends that are associated with these characteristics. Among them are search for increasing durability of building materials, quest for providing greater height and span to the construction, implementation of innovative approaches to increase the degrees of control over the interior environment of the building as well as the use of more robust machineries in construction (Encyclopedia of Britannica, n.d.). The present state of building construction is the result of many evolutionary processes like agrarian, industrial, and digital. In the process of evolution, the design process of building construction became more and more complicated. At the same time, this process also created a broad range of building products that are categorized according to the building types and markets. Today’s building construction process involves professionals like building product manufacturers, craftsmen, contractors, coordinators, specialized consultants, and quality control personnel. This complex integrated process represents the largest industry in the world. According to United States Environm ental Protection Agency (EPA), in the USA this industry in 2002 consisted of 223,114 establishments representing more than $531 billion in annual revenues. It is no doubt that this complex process provides countless benefit to the society, however; at the same it uses a vast amount of resources. Worldwide construction activities consume three billion tons of raw materials each year; it is 60% of total global use (Dixon, 2010; Ahmed, 2010). Loss of agricultural land to the building is 80% (Dixon, 2010). Total land area in the USA is 2.3 billion acres; urban land area from 1945 to 2002 quadrupled against twofold population growth over the same period (United States Energy Protection Agency, 2009). During the time of 1997 to 2002, rural land use for residential purposes increased by 29% (United States Energy Protection Agency, 2009); no other industry uses more material worldwide than the construction industry (Ahmed, 2010). Per Australian Bureau of statistics building and construction industries use 55% of timber, 27% of plastic products and 12% of iron and steel (Australian Bureau of Statistics, 2003). Building construction industry on one side consumes enormous natural resources, and on the other side it gives to nature heat and pollution, construction waste, solid waste, sewage and surface drainage. According to EPA (United States Energy Protection Agency, 2009), buildings in the United States produces 38.9% of the nation’s total carbon dioxide emissions; 20.8% from the residential sector and 18.1% from the commercial sector. According to

How can high schools better educate students imaginations Essay - 1

How can high schools better educate students imaginations - Essay Example Educating students’ imaginations through the different initiatives forms a firm foundation for creativity and generation of improved ideas. This paper elaborates how having a class pet would improve students’ imaginations in school and later on in life i.e. expanding their imaginative skills could mark their cultivation as a habit and application in daily tasks of the world. Pets or animals make good companions for man and the relationship creates a different understanding of everything as compared to the way humans express their interactions. Introducing a class pet creates a unique chance that educators can utilize for edification through fun and augmented interaction. Some student’s might argue that they are too old to pet but it is because they do not comprehensively understand the advantages of introducing a rabbit, cat or hamster as part of the curriculum. Learning works better when students cultivate a candid interest of the environment and its components thus introducing a pet in the English or art class enhances the overall experience. The idea of class pet provides a wide platform for educating students’ imagination inside and outside the classroom. For instance, the teacher can ask the students to research on the class pet, which sparks an interest in reading various books on the pet and can share with their age-mates. Upon researching, the teacher can also request the students to write an article on their pets after everyone spending a day with it. The description of their experience enhances the imaginative skills, especially if the teacher participates more by giving each student a particular aspect to focus on in their description. Additionally, such a task combines English and imaginative skills development. Definitely, the idea of a class-pet for better educating students’ imagination has its challenges with the main being resentment from students in the classroom. Definitely, some of the

Homeland Security Coursework Example | Topics and Well Written Essays - 1000 words - 1

Homeland Security - Coursework Example The paper tells that signed by George Bush, The Patriot Act aims for uniting and strengthening America by providing appropriate tool required intercepting and obstructing terrorism. The United States Northern Command or NORTHCOM is a branch of the US military that defends the US against any possible mainland invasion. This unified Combatant Command is responsible for safeguarding the US from any air, land or sea attack that could potentially come from Mexico, Canada, Alaska or Puerto Rico. The National Infrastructure Protection Plan or NIPP is plan developed by the Department of Homeland security. The plans aims to bring together critical infrastructure and key resources in the country to act as protection for the country against any potential attacks According to this plan, the public and private sector needs to form a unified front in order to minimize risk for the country. Risk Management is a systematic task of identifying, evaluating, prioritizing and minimizing risk while also taking into consideration financial and other resource constraints that an organization may face. Signals Intelligence o SIGINT, as opposed to HUMINT, is intelligence gathered through the help of technology or more specifically signals. This includes both communications intelligence and electronic intelligence. National Response Framework or NRF is a part of the strategy developed by the Department of Homeland Security to bring the country together in the case of a disaster or emergency. The framework aims to improve the country's ability to manage incidents by covering all aspects of a disaster. The Posse Comitatus Act is an Federal law act enacted by the Congress in 1878. This act prevents the US military personnel to act as law enforcement agents within the United States. In this capacity, the law limits the power of the Federal government to enforce any state law in US.

Energy Needs in Mexico Research Paper Example | Topics and Well Written Essays - 4000 words

Energy Needs in Mexico - Research Paper Example In other words, energy is the capability of doing work, spawning heat, and discharging luminosity or emission. On the other hand, power is the energy spent over a given period, say, per unit time. The two are interrelated and one cannot do minus the other. So far, there are over six elementary sources of energy, which include nuclear, thermal and electromagnetic energy. Other forms of energy include electricity, mechanical and chemical energies. Different countries use different forms of energy or a combination of many forms of energy. In Mexico, the government of Mexico struggles to meet the energy needs of the country by using a combination of different forms of energy. Notably, coal and fossil fuels are the dominant sources of energy in Mexico. Perhaps due to their abundance within and without Mexico, fossil fuels are the most common source of energy not only in Mexico, but also in other countries. However, with the warning of fossil fuels getting scarce and their adverse effects of combustion, various countries just like Mexico are busy adopting new forms of energy (Buen & Isabel, 2006, pp. 1-3). The Mexican constitution gives the state the mandate to generate, transmit, and distribute different forms of energy to the citizenry.... For instance, the generation of electricity in Mexico depends on 75 percent of thermal sources, 19 percent from water generation (hydropower). Other sources accounting 2 percent include biomass, solar and wind. Recently, the government embarked on plan to increase its energy figures by 14.8 GW by 2015 using other sources of energy such as renewable sources. This research paper addresses the energy needs in Mexico, the challenges facing its energy sector, and the implication on the economy (Auer, 2001, pp. 1-7). 1.1 Statement of the problem Although there are abundance reserves of both natural gas and petroleum in Mexico, the problem of energy insufficiency persists in a country that is trying so hard to set its path towards positive economic growth figures. The ever-growing economic demands in the country are slowly but surely outpacing the ability of Mexico to produce additional energy. To make matters worse, the poor infrastructure in the exploitation of these two fundamental sourc es of energy has made the country loose millions of dollars due to the flaring up of natural gas. Additionally, the government has been on the receiving end for not investing enough in the energy sector thus, affecting the exploration and production of these basic sources of energy. Inadequate investment from the private sector is also another impediment facing the energy sector in Mexico. The lack of storage facilities for refined oil is also another challenge facing Mexico, as this forces the government and other energy sector players to import at least 25 percent of gasoline. Major infrastructure projects happening in the energy sector in Mexico have almost come to a standstill due to budgetary constraints. For

Opposition Against Macbeth Essay Example for Free

Opposition Against Macbeth Essay Finally the three witches who built up Macbeth is also opposing him with a new prediction which would lead to his downfall. (3. 5 29-31) In Act three we are introduced to Macbeths deception and paranoia as he begins to suffer horrifying images of his murdered victims appear amongst him. Macbeths greatest opposition as he quickly destroys his status among others is Banqou his closest friend . Banqous suspicion towards Macbeth grows deeper ,yet it’s his persistence towards his prophesies that forces him into silencing the topic of his beliefs and knowledge for his own ambitions. Banqou awaited for his prophesies to suffice his wants yet as the time grew Macbeth grew in power with dark intentions. AS time quickly slipped through Banqous hand Macbeth noticed the threat the Banqou held against him. (Act3-2)(40-61)Macbeth began to experience paranoia and Banqous suspicion fueled that paranoia. With the witches misleading statements towards Banqous life and rise to glory, Macbeth was convinced there was a defective statement that may lead to his death through Banqous request. With fear and hatred circling his mind, Macbeth convinced two attendants to murder Banqou. (Act3-3)(12-33)As the two murders go off and commit their crime, Macbeth hints to his wife of great plans and that’s a sign of glory and confidence filling his soul. Macbeth had experienced a lack of sleep and a lack of apatite as he sat at his thrown while Banqou and others revolved around him with great suspicion leaving an emotional and mental scar. Act3-4)(49-101)After Banqous death, Macbeth grew great confidence yet it was the idea of murdering his friend haunted him daily and knowing Fleance escaped grew more fear within his soul. (Act3-5) The second opposition which played a large role from the beginning was the witches and Hecate. Macbeth finally reached his goal and accomplished his prophesy yet it was his greed that made him want more power and knowledge of future occurrences ,Knowing this Hecate Decided to convince Macbeth of more glory awaits him and raise his confidence to a higher level which will finally destroy him and lead him to his great down fall. Hecate knew Macbeth’s rain among Scotland and those close to him had to reach its limit and allowing him to continue would lead them to their death. In order to avoid the conflict and remove Macbeth from his power swiftly, Hecate and the other witches decided to allow Macbeth collapse on himself through gentle statements they created. Macbeth’s insecurity and fear leads him to gain enemies and demons which over take his mind. Act3-6)The final great opposition that slowly forms against Macbeth was Lennox and the other lords. Lennox and the other lords begin to discuss Macbeth’s actions among his territorial rule. The lords begin to discuss all the crimes they are sure Macbeth had committed. Macbeth begins to create a defence for himself as he find out his enemies alliance grows rapidly. Macbeth leads himself into the lowes t of situations as he slowly begins to murder others . His suspicion and terror haunts his every move and his enemies grow with his every day at his position.

Definition of Recession and the Predicted Recession in the Malaysian economy

Definition of Recession and the Predicted Recession in the Malaysian economy What is economic recession? Economic recession is defined as a decline in the countrys Gross Domestic Product (GDP) growth for about two or more consecutive quarters in a particular year. Gross Domestic Product (GDP) consists of the monies spent by consumers, the investments made by private companies and the government, government spending on labor and products, and the net total of a countrys exports. As a part of a normal business lifecycle, when an economy that grows over a period of time tends to slow down. An economy typically grows for 6 to 10 years and later is likely to go into a recession for about 6 months to 2 years. Thus, economic recession is a declining phase of the business life cycle when there decline in economic activities spread across the economy, lasting for more than a couple of months, normally visible in Gross Domestic Product or GDP, employment, real income, industrial production and wholesale or retail sales. A recession has many characteristics that can occur simultaneously and can include declines in real-time measures of overall economic activities. Recessions are the result of reduction in the demand and may also be associated with falling prices also known as deflation, or on the other hand it could also be due to increasing prices also known as inflation or a combination of increasing prices and stagnant economic growth. A prolonged or severe recession is referred to as an economic depression. Although the difference between a recession and a depression is not clearly stated, it is often believed that a decline in Gross Domestic Product or GDP of more than 10% constitutes a depression. The cause of an economic recession primarily depends on the actions taken to control the money supply in an economy. The Federal Reserve is the agency responsible for maintaining the delicate balance between money supply, interest rates, and inflation. When this delicate balance is tipped, the economy is forced to correct itself. Furthermore, the Federal Reserve sometimes deals with these situations by dumping huge amounts of money supply into the money market. This helps to keep interest rates low, even as inflation rises. Inflation is the rise in the prices of goods and services over a period of time. So, if inflation is increasing, it means that goods and services are costing more now than they did before. The higher the level of inflation, the smaller the percentage of goods and services is which can be bought with a certain amount of money. There can be many contributing factors for inflation, which include but are not limited to increased costs of production, higher costs of energy and the national debt. In an environment where inflation is prevalent, people tend to cut out things like leisure spending. They also budget more, spend less on things they usually indulge in, and start saving more money than they did. As people and businesses start finding ways to cut costs and derail unneeded expenditures, the GDP begins to decline. Then, unemployment rates will rise because companies start lying off workers to cut more costs, because consumers are not spending like they were. It is these combined factors that manage to drive the economy into a state of recession. An economic recession can be expected before it actually happens. There are many ways to spot a recession before it actually happens. For instance, by observing the changing economic landscapes in quarters that come before the actual onset we can predict whether a recession is about to occur or not. You will still see GDP growth, but it will be coupled with signs like high unemployment levels, housing price declines, stock market losses, and the absence of business expansion. When an economy sees more extended periods of economic recession, it goes beyond a recession and is declared that the economy is in a state of depression. On the other hand, the benefit of an economic recession is that it will help to cure inflation. As a matter of fact, the delicate balancing act that the Federal Reserve struggles to pursue is to slow the growth of the economy enough so that inflation will not occur, but also so that a recession will not be triggered in the process. Now, the Federal Reserve performs this balancing act without the help of fiscal policy. Fiscal policy is usually trying to stimulate the economy as much as is possible through such things as lowering taxes, spending on programs, and ignoring account deficits. Currently the global economy is facing a downturn; In Malaysia the economy has been spotted declining since the first-half of 2008 .This decline may spell bad news for us as it may result as a recession. However, it has been predicted by the government that the economy is not going to be insulated from the global downturn. It was clearly stated by the current Prime Minister Datuk Seri Abdullah Ahmad Badawi that Malaysia would be able to weather the storm brought on by the U.S. credit crisis as we still have strong economic fundamentals as well as being politically stable. In his statement he said We have very strong reserves, our surplus is still strong, our domestic savings are also very high and our currency is also stable and not subject to fluctuation, He also said We have the strength and the resilience of Malaysians as we have faced it before and our banking system is still strong, theres stability in the country and predictability in terms whats going to develop politically,. The Prime Minister admitted that it was not going to be easy, but with good cooperation with the public and the government our country could get through the recession with not much damage. On the other hand, it has also been predicted that the Malaysian economy will most probably see a full blown recession this year given the steep deterioration in recent economic activities both locally and globally. Based on an article in The Star Online of 5th March 2009, it was predicted that the economy may contract by1.19% in 2009. It was clearly stated in the phrase A poll of economists expectations for 2009 projects the economy would contract by 1.19% this year as the slump in exports and slowing domestic demand bite hard especially in the first half of the year. However, there were also predictions that the contractions of the Malaysian economy would be temporary and would recover later in this year. The Affin Investment Bank economist Alan Tan said The first half will be weak but I am expecting stabilization late in the year on a recovery in exports and domestic demand. This statement was also supported by another statement by the RHB Investment Bank Bhd economist Peck Boon S oon, however this time the economy was predicted to rebound in 2010. The table below shows the forecast growth of the Gross Domestic Product by Malaysias top financial institutes. Besides that, in view of the deteriorating global economy and as a step to be ready for an economic recession, the Central Bank of Malaysia (Bank Negara Malaysia) has lately reduced the Overnight Policy Rate (OPR) by 25 basis points to 3.25 per cent. Its clearly stated in the Malaysian Economy-Update Blog that the Malaysian economy is getting or expecting to get worse if no monetary and fiscal policy changes. To add liquidity into the system and reduce the cost of funds, the statutory reserve requirement (SRR) has been cut from 4.0 per cent to 3.5 per cent effective Dec08. If domestic conditions worsen, amid subsiding inflation, the OPR may be slashed to 3.0 per cent or even lower. The reduction of interest rate has to be done cautiously as it may unintentionally lead to a weaker ringgit that would push up the cost of imports. The deficit fiscal target for 2009 has also been raised to 4.8 per cent of GDP, from 3.6 per cent previously. This may be justified as difficult times call for drastic measures. However, there are concerns that government revenue would be adversely affected by the falling commodity prices, which could subsequently enlarge the deficit to even exceed 5.0 per cent of GDP. All of this signs clearly states that the Malaysian economy is going into a recession. The graph below shows the decline of the GDP growth. The Malaysian Institute of Economic Research (MIER) has also defined Malaysias current economic situation as a recession. Based on the article in the Malaysian Economy-Update Blog dated 5th of March 2009, MIER says Malaysia stands on the brink of recession as falling demand hits exports and manufacturing with growth expected to reach 0.5% this year. MIER forecast the economic growth for first half of 2009 will be negative which will put Malaysia in a technical recession, but will show positive figures in the second half of 2009. The Executive Director of MIER Mohamaed Ariff said overall, it will be 0.5% growth for this year in the best-case scenario. The worst-case scenario is there is a 50% chance of a full-blown recession this year. Furthermore, this has also lead to the reduction of employments which results in the downfall in the Consumer Sentiments Index (CSI). This is shown in the graph below. Based on all the evidence provided above, it could be seen that the current Malaysian economy is going into a downfall and may result in a recession. Even though the government has not officially declared a recession its very important for us to be ready to face one as we do not know how bad it may result as. The predicted contraction of the economy by 1.19% will be one of the major causes of the recession as there will be a massive reduction in exports and domestic demands. The reduction of the Overnight Policy Rate by the Central Bank (Bank Negara Malaysia) is also one of the signs that Malaysia is going into a recession, this is because the reduction of the Overnight Policy Rate would result in the reduction of the GDP growth because less money would be invested in the economy and would lead to the downfall of the economy. On the other hand, as stated by the Malaysian Institute of Economic Research (MIER) the reduction of employments and downfall of the Consumer Sentiments Index (CSI) shows that Malaysia would be facing a recession. However, as said by our respected Prime Minister, the downfall that is about to be faced by our country may not last long as, because Malaysia has very strong reserves, high domestic savings and also our currency is quite stable. This forecast recession is predicted to rebound in the third or fourth quarter this year this year or latest by 2010. To sum it all up, a recession is not an event that is waited for, however its a part of a normal business lifecycle and its natural for it to occur in an economy every 6 to 10 years once. The best step to take during a recession is to minimize all of our expenditures and save as much as we can. Therefore we should always be prepared to face such situations as we may not know how bad the recession may be and how long it may last.

Relationship between Inflation Rates and Employment

Relationship between Inflation Rates and Employment CHAPTER 1 Gross Domestic Product as an indicator of wealth and therefore quality of life has long been criticized (Mederly, P. and et al. 2003). Gross Domestic Product (GDP) is the value of total production of goods and services in a country over a specified period, typically a year. The gross domestic product (GDP) or gross domestic income (GDI) is a measure of a countrys overall economic output GDP can be determined in three ways, all of which should in principle give the same result. The most direct of the three is the product approach, which sums the outputs of every class of enterprise to arrive at the total. The expenditure approach works on the principle that all of the product must be bought by somebody, therefore the value of the total product must be equal to peoples total expenditures in buying things. The income approach works on the principle that the incomes of the productive factor must be equal to the value of their product, and determines GDP by finding the sum of all producer s incomes (Bureau of Economic Analysis, U.S Department of Commerce, 2007). The most common approach to measure GDP is the expenditure method: GDP= private consumption + gross investment + government spending + (exports à ¢Ã‹â€ imports) GDP = C + I + G + (X-M) (Equation 1.1) An event in 1975 that remind us the current GDP in our country where the Malaysian economy slumped into its great recession, with a GDP growth rate of only 0.8 percent, compared to 8.3 percent in 1974. This is one of the effects of increase in oil prices and then substantial price increase in 1973 were bought about mainly shortage of food and raw materials arising from bad weather and increased aggregate demand (Cheng, M.Y. and Tan,.H.B. 2002). According to the above circumstances occurred in 1975, the researcher has choosing one of variables that may relate with fluctuation of GDP which is inflation rate. Inflation means either an increase in the money supply or an increase in price levels. Generally, when we hear about inflation, we are hearing about a rise in prices compared to some benchmark. The study of the effects of inflation on economic growth continues to be an important and complex topic in economics. If inflation has real economic effects, then governments can influence economic performance through monetary policy (Risso, W.A and Carrera, E.J.S, 2009). Therefore, investigating how inflation affects economic growth pertains directly to the optimal design of monetary policy. Results from such studies are particularly important for economies. Besides the inflation, the researcher has considered total employment as one of the variable in the model since economic growth and employment are correlated between each others. The relationship between unemployment and GDP is called Okuns law. It is the association of a higher national economic output with the decrease in national unemployment. This is because in order to increase the economic output of a country, people will need to go back to work, thus lowering unemployment. In order to support the relationship exist between GDP and employment, the researcher has found out the issue supporting the theory that GDP and employment has a positive relationship between each others. According to Hassan, M.K.H. and et al. (2010), in the period of 1996 -1997, the manufacturing sector experienced a rapid growth producing the employment rate in the sector to grow at 7.7 percent per annum but later declining to negative 3.6 percent in 1998 due to the economic recession. In addition, in year 2000, the Malaysian manufacturing sector contributed 33.4% to gross domestic product (GDP), 85.2% to total export and 27.6% to total employment. 1.2 PROBLEM STATEMENT Inflation is a major source of economic instability because it weakens incentives for work and production, distorts the allocate efficiency of the market mechanism, erodes international competitiveness of the domestic industry, and reduces growth potential. According to study by Fischer and Modigliani (1980) suggested a negative and nonlinear relationship between the rate of inflation and economic growth through the new growth theory mechanism. Furthermore, inflation also damages economic growth by lowering domestic and foreign savings, reducing efficiency of resource allocation, and deteriorating the balance-of payments (Risso, W.A. and Carrera, E.J.S., 2009). According to Cheng, M.Y. and Tan, H.B. (2002), the economy has experienced episode of high (1973-1974, 1980-1981) and low (1985-1987) regimes of inflation, and was able to contain low and stable inflation during the high economy growth period of 1988-1996. The second problem statement that should be concerns since the employment can affect the economic growth and it is important variable to determine the quality of production for national output and next will influence the GDP of our country. For example, in the early 1990s, the unemployment rate increased for about a year following the end of the previous recession. Coming out of a recession, companies are thought to be reluctant to hire many more workers until they are convinced about the sustainability of a new economic recovery while people who had left the labor force during the recession return to seek to find jobs (Seyfried, W.). Therefore, the researcher conducts this research in order to examine the correlation exists between inflation rate and employment with GDP so that we can help the country to mitigate the problem occurs by supporting the governments policies to increase the countrys GDP. In addition, this research also useful since the results of the studies can be used in policys decision for resource allocation in order to accelerate economic growth. 1.3 OBJECTIVES The objectives of the study are to: 1.3.1 Analyze the relationship between Inflation Rate and Gross Domestic Product in terms of magnitude and direction. 1.3.2 Analyze the relationship between Total Employment and Gross Domestic Product in terms of magnitude and direction. 1.4 SIGNIFICANCE OF THE STUDY The significances of this study are as follow: 1.4.1 Researcher This study will help the researcher to complete their course requirement and will be as guidelines for their field of work in the future. The researcher can gain many experiences in order to complete this research. There are lot of weaknesses may be obtained and this will encourage the researcher to provide the better research in the future. Future researcher will know and more understanding about gross domestic product when conduct this research. It will give the knowledge to the researcher to identify the correlation exist between inflation rate and employment and it always make the researcher briefing to know deeply and applied the study. 1.4.2 Organization This study might help the organization in analyzing the countrys economic condition in order to prevent and reduce the risk during the inflation and know the effects of the crisis occurs to them. This study also may give some guidance to them to protect their company and industry itself. 1.4.3 Public This study can inform and gives some knowledge to the public the relationship between economic growth, inflation rate and employment. They also can make preparation to face the increasing in inflation rate and able to survive in that situation. 1.5 SCOPE OF THE STUDY The researcher chooses to conduct the research about GDP in Malaysia from 2000 until 2010 In this study, the researcher wants to determine the correlation exist between inflation rate and employment with GDP in Malaysia. It is important because as economic planners and forecasters used the GDP per capita in monitoring economic growth trend for time series. The collection of data of GDP, inflation rate and total employment were collected from Department Of Statistics Malaysia in quarterly basis. 1.6 THEORETICAL FRAMEWORK Figure 1.1: Theoretical Framework INFLATION RATE GROSS DOMESTIC PRODUCT EMPLOYMENT RATE RATE Independent variables Dependent Variable Figure 1.1 represents the dependent variable and independent variables in this study. The function of theoretical framework has been clarified by Sekaran, U. (2003) which is a conceptual model of how one theorizes or makes logical sense of the relationship among the several factors that have been identified as important to the problem. Figure above clearly discuss the correlation between Gross Domestic Product which is variable primary to the researcher while Inflation Rate and Employment act as independent variable which is influences the dependent variable. 1.7 HYPOTHESIS In classical test of significant, two kind of hypothesis are used. They are Null Hypothesis and Alternate Hypothesis. Hypothesis is a conjectural statement that describes the relationship among variable even negative or positive. Null hypothesis which is represent by H0 symbol to show that the relationship between independent and dependent variable is not exist. However alternate hypothesis is representing by H1 symbol to show that the relationship is existing between both dependent and independent variable. According to Sakaran (2004), a hypothesis defines as a logically conjectured relationship between two or more variables expressed in the form of testable statement. Relationship a conjectured on the basis on the network of associations established in the theoretical framework formulated for the research study. There are two hypotheses that can describes the correlation exists between dependent variable and independent variables. Therefore the hypothesis that can be tested as follows: Inflation and GDP H0: there is no significant relationship between inflation and GDP. H1: there is a significant relationship between inflation and GDP. Employment and GDP H0: there is no significant relationship between employment and GDP. H1: there is a significant relationship between employment and GDP. 1.8 LIMITATION / CONSTRAINTS The limitations / constraints are: 1.8.1 Time constraint The length of time is limited since the researcher does not have much time to make detailed research. The time provided only three months and the researcher need to divide time properly to complete the research because the process of collecting data is quite difficult. 1.8.2 Cost constraint The cost involves is quite high since as a student, the researcher only depend on the loan applied. Examples of cost involve in order completing this research such as cost of printing, cost of maintaining the laptop, cost of surfing the internet and etc. 1.8.3 Data constraint Since the researcher use the secondary data, the collection of data that have been publish are so limited and the related material are not very supporting the topic of research. 1.8.4 Lack of experience The researcher is less of experience in conducting the research therefore needs to refer the researchers advisor to process the data and learning the skill that needed as a good researcher. CHAPTER 2 LITERATURE REVIEW 2.1 DEPENDENT VARIABLE 2.1.1 GROSS DOMESTIC PRODUCT (GDP) Generally, according to Chan, W.W. and Lam, J.C. (2000), gross domestic product is a common measure of the economic well-being of a society. When government officials plan for the future, they consider the various economics sectors contributed to the gross domestic products. In the other study by Ivanov, S. and Webster, C. (2007), they use the growth of real GDP per capita gr as a measure of economic growth in line with other publications in the field (see Ivanov and Webster, 2007; Lopes et al., 2002; Plosser, 1992). The function of GDP also has been explained by Kosmidou, K. (2008) where gross domestic product (GDP) is among the most commonly used macroeconomic indicators, as it is a measure of total economic activity within an economy. The gross domestic product growth (GDPGR), calculated as the annual change of the GDP, is used as a measure of the macroeconomic conditions. The significance between GDP, foreign trade and foreign direct investment has been discussed by Liu Ying and Cui Riming (2008) where the economy is highlighted by the significant performance of both its economic growth and its foreign trade and foreign direct investment. Under this background, the correlation of foreign trade, foreign direct investments and economic growth in has become an important issue for academic research. Previous studies support that foreign trade and foreign direct investment have positive impacts on gross domestic product (GDP). In the study by Malul, M. and et al. (2008), the GDPpc is used mainly to compare the standard of living in different countries. It means that the higher of cost of living in a country, the higher earning of gross domestic product of the country. According to Wong, K.Y.(2008),economic growth of an economy refers to the expansion of its production possibility set, as a result of accumulation of primary factors such as labor and capital (physical and human), or improvement of production technologies. However, because the production possibility frontier (PPF) of an economy is not observable, economic growth is usually measured in terms of the growth rate of some observable variables such as real GDP or real per capita GDP. Besides that GDP also one of the result of the countrys economic activities based on the statement of Daly and Cobb (1989), GDP expresses the content of physical flows of à ¢Ã¢â€š ¬Ã…“capital, industrial production, services, resources and agricultural productà ¢Ã¢â€š ¬?. The scientific research has been conducted by Ligon and Sadoulet (2007) using a sample of 42 countries show that GDP growth, which comes from agriculture is at least twice as effective in reducing poverty compared to GDP growth coming from nonagricultural areas. In order to know the correlation between inflation and growth, Gokal, V. and Hanif, S. (2004), stated that the tests revealed that a weak negative correlation exists between inflation and growth, while the change in output gap bears significant bearing. The causality between the two variables ran one-way from GDP growth to inflation. While, according to some consensus exists, suggesting that macroeconomic stability, specifically defined as low inflation, is positively related to economic growth. 2.2 INDEPENDENT VARIABLES 2.2.1 INFLATION RATE (INF) Inflation on economic growth continues to be an important and complex topic in economics. If inflation has real economic effects, then governments can influence economic performance through monetary policy. Therefore, investigating how inflation affects economic growth pertains directly to the optimal design of monetary policy. According to Andres and Hernando (1999), for example, reducing inflation by one percentage point when the rate is 20 percent which results in an increase in the growth rate of 0.5 percent, compared to reducing inflation by one percentage point when the inflation rate is around 5 percent, which results in a decrease in the growth rate by 1 percent. Furthermore, a study by Mallik and Chowdhury (2001), the structuralisms argue that inflation is necessary for economic growth, whereas the monetarists argue the opposite, that is, inflation is detrimental to economic growth such debate started in the 1950s, focused on developing countries, which had long suffered fro m low-growth rates with high rates of inflation and larger deficits in the balance of payments. In order of inflation, the monetarists argue that price stability promotes economic growth and protects the balance of payments. They argue that inflation is major sources of economic instability because it weakens incentives for work and production, distorts the allocative efficiency of the market mechanism, erodes international competitiveness of the domestic industry, and reduces growth potential. They also argued that inflation damages economic growth by lowering domestic and foreign savings, reducing efficiency of resource allocation, and deteriorating the balance-of-payments. To monetarists, stable prices are the starting point in the process of economic development. The policy choice of a country would be stabilization with growth, or stabilization without growth. Several papers are typical of the monetarist tradition. To argue that, according to Fischer and Modigliani (1980) suggested a negative and nonlinear relationship between the rate of inflation and economic growth through the new growth theory mechanism proposed a model where the agents decide the level of labor output, and an increase in inflation reduces labor supply, and producing a decrease in economic production. On the other hand, a study by Mundell and Tobin (1965), the structuralizes argue that inflation normally accompanies economic growth in developing countries because structural rigidities and bottlenecks in supply sectors prevent the elastic supply of some basic commodities such as food, housing, energy, and transportation. Increased income as a result of growth would expand demand for such basic commodities, and prices would rise. The structuralize position is that economic difficulties in developing countries have roots deeper than just the results of inflation. Thus, structuralizes thought that inflationary pressures and det erioration in the balance of payments inevitably are attendant matters of economic growth. In developing countries, there thus would be a trade-off relationship between economic growth and inflation and an attendant deterioration in balance of payments. If a developing country wants stabilization of prices and balance of payments, it must reduce the speed of economic growth, including a sacrifice of employment. Among scholars who support the structuralize position on a positive relationship between inflation and economic performance, predict a positive relationship between the rate of inflation and the rate of capital accumulation, which in turn implies a positive relationship to the rate of economic growth. But, DeGregorio (1996) and Fischer (1926) pointed out, since money and capital are substitutable, an increase in the rate of inflation increases capital accumulation by shifts in portfolios from money to capital and thereby stimulate a higher rate of economic growth was the first to establish a negative correlation between inflation and unemployment. According to Grier and Grier (2006), it presents evidence on the real effects of inflation and inflation uncertainty on output growth. Their main findings are as follows: Inflation uncertainty has a negative and significant effect on growth Once the effect of inflation uncertainty is accounted for, lagged inflation does not have a direct negative effect on output growth; and As predicted higher average inflation raises inflation uncertainty, and the overall net effect of average inflation on output growth. Differ with theory of Bortis, H. (2004), he argues that inflation is a macroeconomic phenomenon represented by a gap between global supply and global demand. Inflation affects the money-output relationship, as does deflation; both phenomena modify the purchasing power of money over domestic output. In this view, price indices cannot come to grips with the inflation phenomenon. While Cheng and Tan (2002) in their study inflation in Malaysia, suggested that main factors affecting Malaysian inflation were external (foreign trade, foreign direct investment and technology transfer). Malaysia has been comparatively successful in balancing strong economic growth with moderate levels of inflation in the periods preceding and following the Asian Financial crisis. Actually, empirical results related to low and medium inflation are of a mixed nature; some papers (mainly these analysing the developed economies) argues that moderate inflation negatively affects growth (e.g. Alexander, 1997, Gillm an et al. 2002; Gillman and Harris 2009; Gillman et al. 2001; Fischer 1993; De Gregorio 1992 and 1993) while other argues that moderate inflation is actually stimulating growth. On the theory side Friedman (1977) in his Nobel lecture argues that a positive relationship between the level of inflation and inflation uncertainty. Friedman points out higher inflation leading to greater uncertainty, which lowers welfare and efficiency of output growth. On the other hand, Ball (1992) formalizes Friedmans hypothesis using an asymmetric information game where public faces uncertainty regarding the type of policymaker in the office. One of the policymaker is willing to tolerate a recession to reduce inflation and the other is not. During the low inflation time, both type of policymakers will attempt and try to keep it low. But, when inflation is high, only the tough type or anti-inflation policymaker will bear the economic costs of disinflation. The argument that central banks should emphasize holding down inflation comes from the beliefs that inflation has an adverse effect on macroeconomic variables, such as output and productivity growth. According to Clark (1982), inflation causes misperception of the relative price levels and leads to inefficient investment plans and therefore affects productivity inversely. Furthermore, inflation erodes tax reductions for depreciation and raises the rental price of capital, which in turn causes a reduction in capital accumulation and therefore in labour productivity. In addition, according to Feldstein (1982) inflation disrupts investment plans by imposing a higher tax rate on corporate profits and through higher effective tax rates on corporate income and accordingly affects productivity (Gilson, 1984; Boskin et al., 1980). Finally, inflation distorts price signals and reduces the ability of economic agents to operate efficiently (Smyth, 1995). According to Chen and et al. (1991), it has documented a significant relationship between the US stock returns and real economic variables such as industrial production, real GNP, interest rates, inflation and money supply. Besides that, there are also otherwise arguments that there is no relation between inflation rate and gross domestic product in the long run. For instance, Faria and Carneiro (2001) investigate the relationship between inflation and output in the context of an economy facing persistent high inflation and they find that inflation does not affect real output in the long run, but that in the short-run inflation negatively affects output. In addition, scholars such as Sidrauski (1967) suggest that there is no relationship between inflation and economic growth, supporting the hypothesis of super neutrality of money. On the other hand, Sarel (1995) asserts that there is a nonlinear relationship between inflation and economic growth. Using 87 countries, he finds the existence of an inflation threshold of 8 percent. Above the threshold there is a negative relationship between inflation and economic growth, whereas under the threshold there is a positive but not significant relationship. The others studies in order to prove Sarels result, Judson and Orphanides (1996) divide Sarels sample of countries into three groups, and they find similar results to Sarel, finding a threshold of 10 percent. Ghosh and Phillips (1998a, b) study 145 countries in the period 1960-1990 again finding similar results. Paul et al. (1997) study 70 countries (of which 48 are developing economies) for the period 1960-1989. They find no causal relationship between inflation and economic growth in 40 percent of the countries, bidirectional causality among 20 percent of the countries, and unidirectional causality for the rest (either inflation to growth or vice versa). Lastly, Mendoza (1998) finds that inflation has had no effect on Mexicos long-run economic growth since he conducted the study of inflation in Mexico. 2.2.2 EMPLOYMENT Some of studies have been conducted to examine the relationship between gross domestic product and employment. For instance, according to Okun (1962) and Philips (1958), they found different relationship both of these. Okun found a negative correlation between unemployment and economic growth, then from both propositions it can be deduced a positive relationship between economic growth and inflation while Phillips proposed a positive relationship between inflation and unemployment implying the same type of relationship. In addition, Boltho and Glyn (1995) found elasticities of employment with respect to output growth in the order of 0.5 to 0.6 for a set of OECD countries. While according to Evangelista and Perani (1996) discovered evidence suggesting that restructuring of major economic sectors reduce the relationship between economic growth and employment. A specific research conducted by Seyfried, W., among the G7 countries (Canada was excluded), a positive and significant relationship between growth in value added and employment was found only in Germany and the US. In addition, according to Verdoon (1949) and Kaldor (1966), an increase in output growth of 1 percent leads to an increase in productivity and employment growth of half a percentage point each. It should be noted that the higher the productivity effects of growth, the more difficult it will be to keep unemployment from rising. According to Okuns Law an increase of the economic growth rate by 3 percent (above the normal rate) was expected to reduce the unemployment rate by 161 percentage point. Or, to put it the other way round: The gain of real GDP associated with a reduction in unemployment of one percentage point was estimated to be 3 percent. Several studies also have been conducted to examine the correlation exists between employment and inflation rate. One of the studies by Spithoven, A.H.G.M. (1995), by the end of the 1960s evidently there was no fixed relationship between unemployment and inflation. Empirical research revealed that the relationship was not consistent over time and varied sharply between countries. This was explained as follows: in the short run higher nominal wages attract more labour and engender a fall in the rates of unemployment. As soon as the workers recognize the wage rise to be purely nominal they abstain from work, and unemployment is restored to the pre-wage-rise level, but with a level of prices higher than before. Secondly, according to Brenner (1991), confronted with a combination of unemployment and inflation (stagflation), many governments abandoned efforts to regulate the economy by the Keynesian instruments. They declared fiscal policies ineffective and sought refuge in a mixture of m onetary measures with supply-side economics. According to Keynes (1946), the volume of employment is given by the point of intersection between the aggregate demand function and the aggregate supply function. This was naively interpreted and construed to imply that a rise in costs à ¢Ã¢â€š ¬Ã¢â‚¬Å" and with this was meant a rise in costs owing to increasing government expenditure à ¢Ã¢â€š ¬Ã¢â‚¬Å" will result in an upward shift of the supply curve and will cause greater unemployment and inflation. CHAPTER 3 RESEARCH METHODOLOGY AND DESIGN 3.1 MODEL SPECIFICATION This study is to examine the correlation exists between inflation rate and total employment with gross domestic product. It uses secondary data which is based on time series data. The collection of time series data from 1982 to 2006 and the scope is in Malaysia. The researcher applied STATA software to process the data and log-log model in this study. The model applied a log transformation, since log transformations help, at least partially, to eliminate the strong asymmetry in the distribution of inflation (Sarel, 1995) and (Ghosh and Phillips, 1998a, b). The logarithm equation is written in the Equation 3.1. GDP = ÃŽÂ ± + ÃŽÂ ²1In(INF) + ÃŽÂ ²2ln(EMP) + ÃŽÂ µ (Equation 3.1) Where, GDP = Gross Domestic Product ÃŽÂ ± = Constant ÃŽÂ ²1 = Inflation ÃŽÂ ²2 = Employment ÃŽÂ µ = Error term In above equation, it shows clearly dependent variable that has been applied in this study is gross domestic product, besides that, the researcher also used two independent variables which are quantitative variables, they are inflation rate and total employment. 3.1.1 DEPENDENT VARIABLE The dependent variable is the variable of primary interest to the researcher. The researchers goal is to understand and describe the dependent variable, and to explain its variability, or predict it (Sekaran, 2006). Dependent variable of this study is factor contributed to the gross domestic product. According to Zikmund (2000), independent variable is a criterion that predicted or explained. It show that the component contributed to improving of gross domestic product depend on the listed independent variables. 3.1.2 INDEPENDENT VARIABLES According to Zikmund (2000), independent variables that expected to influence the dependent variable. Refer to (Burn and Bush, 2000), independent variables are those variables over which the researcher has some control and wishes to manipulate. In this study, two independent variables will influence the dependent variables. They are inflation rate and employment. 3.2 DATA SET AND METHODOLOGY The collections of data in this research only gain from secondary data and based on time series data which are from 2000 to 2010. The researcher has considered annual data of real GDP, inflation rate and employment. All the data on the growth rate of real GDP, Inflation and total employment were obtained from Department of Statistics Malaysia database. GDP is considered per capita. In addition, according to Aigenger (2005) per capita real GDP is also used as an alternative measure of productivity, as some theoretical models do. Moreover, according to OECD (2001), living standards as represented by per capita income reflects productivity since the former is determined, to a significant extent, by the latter. CPI consider in weight 100 while employment in number of labor. The variables were selected based on relevant economic theories that allow for the interaction among inflation rate and total employment in addition to response to GDP. 3.3 TECHNIQUE ANALYSIS DATA In this research, the researcher has applied unit SPSS in order to determine time series data is stationary or non stationary about the correlation between inflation rate and employment with gross domestic product. The researcher examines the existence of a long-run relationship between inflation and employment with GDP using a vector error-correction model (VECM) after applying Johansens (1988, 1990, and 1995) cointegration technique. We conduct a test for weak exogeneity in order to do inference. Then, the researcher conduct stability test by using Jarque Bera test in order to test normality distribution between the variables selected. Finally, a modified version of the Granger causality test is applied in order to analyze causality between the variables. 3.4.1.1 Multiple Regression Analysis Multiple Linear regression analysis is an analysis of the relationship between one variable (dependent variable) and set of variable (independent variables). It is used by the researcher to test the hypothesis. As in all hypothesis tests, the goal is to reject the null hypothesis and accept the alternative hypothesis. This technique will identify how much of the variance in the dependent variables can be explained by independent variables. This analysis is used primarily for the purpose of prediction. The regression model can be used to predict the value of the proposed model in the study is: GDP = f (INF, EMP) GDP = ÃŽÂ ± + ÃŽÂ ²1 Inflation+ ÃŽÂ ²2 Employment + ÃŽÂ µ Where, GDP = Gross Domestic Pr Relationship between Inflation Rates and Employment Relationship between Inflation Rates and Employment CHAPTER 1 Gross Domestic Product as an indicator of wealth and therefore quality of life has long been criticized (Mederly, P. and et al. 2003). Gross Domestic Product (GDP) is the value of total production of goods and services in a country over a specified period, typically a year. The gross domestic product (GDP) or gross domestic income (GDI) is a measure of a countrys overall economic output GDP can be determined in three ways, all of which should in principle give the same result. The most direct of the three is the product approach, which sums the outputs of every class of enterprise to arrive at the total. The expenditure approach works on the principle that all of the product must be bought by somebody, therefore the value of the total product must be equal to peoples total expenditures in buying things. The income approach works on the principle that the incomes of the productive factor must be equal to the value of their product, and determines GDP by finding the sum of all producer s incomes (Bureau of Economic Analysis, U.S Department of Commerce, 2007). The most common approach to measure GDP is the expenditure method: GDP= private consumption + gross investment + government spending + (exports à ¢Ã‹â€ imports) GDP = C + I + G + (X-M) (Equation 1.1) An event in 1975 that remind us the current GDP in our country where the Malaysian economy slumped into its great recession, with a GDP growth rate of only 0.8 percent, compared to 8.3 percent in 1974. This is one of the effects of increase in oil prices and then substantial price increase in 1973 were bought about mainly shortage of food and raw materials arising from bad weather and increased aggregate demand (Cheng, M.Y. and Tan,.H.B. 2002). According to the above circumstances occurred in 1975, the researcher has choosing one of variables that may relate with fluctuation of GDP which is inflation rate. Inflation means either an increase in the money supply or an increase in price levels. Generally, when we hear about inflation, we are hearing about a rise in prices compared to some benchmark. The study of the effects of inflation on economic growth continues to be an important and complex topic in economics. If inflation has real economic effects, then governments can influence economic performance through monetary policy (Risso, W.A and Carrera, E.J.S, 2009). Therefore, investigating how inflation affects economic growth pertains directly to the optimal design of monetary policy. Results from such studies are particularly important for economies. Besides the inflation, the researcher has considered total employment as one of the variable in the model since economic growth and employment are correlated between each others. The relationship between unemployment and GDP is called Okuns law. It is the association of a higher national economic output with the decrease in national unemployment. This is because in order to increase the economic output of a country, people will need to go back to work, thus lowering unemployment. In order to support the relationship exist between GDP and employment, the researcher has found out the issue supporting the theory that GDP and employment has a positive relationship between each others. According to Hassan, M.K.H. and et al. (2010), in the period of 1996 -1997, the manufacturing sector experienced a rapid growth producing the employment rate in the sector to grow at 7.7 percent per annum but later declining to negative 3.6 percent in 1998 due to the economic recession. In addition, in year 2000, the Malaysian manufacturing sector contributed 33.4% to gross domestic product (GDP), 85.2% to total export and 27.6% to total employment. 1.2 PROBLEM STATEMENT Inflation is a major source of economic instability because it weakens incentives for work and production, distorts the allocate efficiency of the market mechanism, erodes international competitiveness of the domestic industry, and reduces growth potential. According to study by Fischer and Modigliani (1980) suggested a negative and nonlinear relationship between the rate of inflation and economic growth through the new growth theory mechanism. Furthermore, inflation also damages economic growth by lowering domestic and foreign savings, reducing efficiency of resource allocation, and deteriorating the balance-of payments (Risso, W.A. and Carrera, E.J.S., 2009). According to Cheng, M.Y. and Tan, H.B. (2002), the economy has experienced episode of high (1973-1974, 1980-1981) and low (1985-1987) regimes of inflation, and was able to contain low and stable inflation during the high economy growth period of 1988-1996. The second problem statement that should be concerns since the employment can affect the economic growth and it is important variable to determine the quality of production for national output and next will influence the GDP of our country. For example, in the early 1990s, the unemployment rate increased for about a year following the end of the previous recession. Coming out of a recession, companies are thought to be reluctant to hire many more workers until they are convinced about the sustainability of a new economic recovery while people who had left the labor force during the recession return to seek to find jobs (Seyfried, W.). Therefore, the researcher conducts this research in order to examine the correlation exists between inflation rate and employment with GDP so that we can help the country to mitigate the problem occurs by supporting the governments policies to increase the countrys GDP. In addition, this research also useful since the results of the studies can be used in policys decision for resource allocation in order to accelerate economic growth. 1.3 OBJECTIVES The objectives of the study are to: 1.3.1 Analyze the relationship between Inflation Rate and Gross Domestic Product in terms of magnitude and direction. 1.3.2 Analyze the relationship between Total Employment and Gross Domestic Product in terms of magnitude and direction. 1.4 SIGNIFICANCE OF THE STUDY The significances of this study are as follow: 1.4.1 Researcher This study will help the researcher to complete their course requirement and will be as guidelines for their field of work in the future. The researcher can gain many experiences in order to complete this research. There are lot of weaknesses may be obtained and this will encourage the researcher to provide the better research in the future. Future researcher will know and more understanding about gross domestic product when conduct this research. It will give the knowledge to the researcher to identify the correlation exist between inflation rate and employment and it always make the researcher briefing to know deeply and applied the study. 1.4.2 Organization This study might help the organization in analyzing the countrys economic condition in order to prevent and reduce the risk during the inflation and know the effects of the crisis occurs to them. This study also may give some guidance to them to protect their company and industry itself. 1.4.3 Public This study can inform and gives some knowledge to the public the relationship between economic growth, inflation rate and employment. They also can make preparation to face the increasing in inflation rate and able to survive in that situation. 1.5 SCOPE OF THE STUDY The researcher chooses to conduct the research about GDP in Malaysia from 2000 until 2010 In this study, the researcher wants to determine the correlation exist between inflation rate and employment with GDP in Malaysia. It is important because as economic planners and forecasters used the GDP per capita in monitoring economic growth trend for time series. The collection of data of GDP, inflation rate and total employment were collected from Department Of Statistics Malaysia in quarterly basis. 1.6 THEORETICAL FRAMEWORK Figure 1.1: Theoretical Framework INFLATION RATE GROSS DOMESTIC PRODUCT EMPLOYMENT RATE RATE Independent variables Dependent Variable Figure 1.1 represents the dependent variable and independent variables in this study. The function of theoretical framework has been clarified by Sekaran, U. (2003) which is a conceptual model of how one theorizes or makes logical sense of the relationship among the several factors that have been identified as important to the problem. Figure above clearly discuss the correlation between Gross Domestic Product which is variable primary to the researcher while Inflation Rate and Employment act as independent variable which is influences the dependent variable. 1.7 HYPOTHESIS In classical test of significant, two kind of hypothesis are used. They are Null Hypothesis and Alternate Hypothesis. Hypothesis is a conjectural statement that describes the relationship among variable even negative or positive. Null hypothesis which is represent by H0 symbol to show that the relationship between independent and dependent variable is not exist. However alternate hypothesis is representing by H1 symbol to show that the relationship is existing between both dependent and independent variable. According to Sakaran (2004), a hypothesis defines as a logically conjectured relationship between two or more variables expressed in the form of testable statement. Relationship a conjectured on the basis on the network of associations established in the theoretical framework formulated for the research study. There are two hypotheses that can describes the correlation exists between dependent variable and independent variables. Therefore the hypothesis that can be tested as follows: Inflation and GDP H0: there is no significant relationship between inflation and GDP. H1: there is a significant relationship between inflation and GDP. Employment and GDP H0: there is no significant relationship between employment and GDP. H1: there is a significant relationship between employment and GDP. 1.8 LIMITATION / CONSTRAINTS The limitations / constraints are: 1.8.1 Time constraint The length of time is limited since the researcher does not have much time to make detailed research. The time provided only three months and the researcher need to divide time properly to complete the research because the process of collecting data is quite difficult. 1.8.2 Cost constraint The cost involves is quite high since as a student, the researcher only depend on the loan applied. Examples of cost involve in order completing this research such as cost of printing, cost of maintaining the laptop, cost of surfing the internet and etc. 1.8.3 Data constraint Since the researcher use the secondary data, the collection of data that have been publish are so limited and the related material are not very supporting the topic of research. 1.8.4 Lack of experience The researcher is less of experience in conducting the research therefore needs to refer the researchers advisor to process the data and learning the skill that needed as a good researcher. CHAPTER 2 LITERATURE REVIEW 2.1 DEPENDENT VARIABLE 2.1.1 GROSS DOMESTIC PRODUCT (GDP) Generally, according to Chan, W.W. and Lam, J.C. (2000), gross domestic product is a common measure of the economic well-being of a society. When government officials plan for the future, they consider the various economics sectors contributed to the gross domestic products. In the other study by Ivanov, S. and Webster, C. (2007), they use the growth of real GDP per capita gr as a measure of economic growth in line with other publications in the field (see Ivanov and Webster, 2007; Lopes et al., 2002; Plosser, 1992). The function of GDP also has been explained by Kosmidou, K. (2008) where gross domestic product (GDP) is among the most commonly used macroeconomic indicators, as it is a measure of total economic activity within an economy. The gross domestic product growth (GDPGR), calculated as the annual change of the GDP, is used as a measure of the macroeconomic conditions. The significance between GDP, foreign trade and foreign direct investment has been discussed by Liu Ying and Cui Riming (2008) where the economy is highlighted by the significant performance of both its economic growth and its foreign trade and foreign direct investment. Under this background, the correlation of foreign trade, foreign direct investments and economic growth in has become an important issue for academic research. Previous studies support that foreign trade and foreign direct investment have positive impacts on gross domestic product (GDP). In the study by Malul, M. and et al. (2008), the GDPpc is used mainly to compare the standard of living in different countries. It means that the higher of cost of living in a country, the higher earning of gross domestic product of the country. According to Wong, K.Y.(2008),economic growth of an economy refers to the expansion of its production possibility set, as a result of accumulation of primary factors such as labor and capital (physical and human), or improvement of production technologies. However, because the production possibility frontier (PPF) of an economy is not observable, economic growth is usually measured in terms of the growth rate of some observable variables such as real GDP or real per capita GDP. Besides that GDP also one of the result of the countrys economic activities based on the statement of Daly and Cobb (1989), GDP expresses the content of physical flows of à ¢Ã¢â€š ¬Ã…“capital, industrial production, services, resources and agricultural productà ¢Ã¢â€š ¬?. The scientific research has been conducted by Ligon and Sadoulet (2007) using a sample of 42 countries show that GDP growth, which comes from agriculture is at least twice as effective in reducing poverty compared to GDP growth coming from nonagricultural areas. In order to know the correlation between inflation and growth, Gokal, V. and Hanif, S. (2004), stated that the tests revealed that a weak negative correlation exists between inflation and growth, while the change in output gap bears significant bearing. The causality between the two variables ran one-way from GDP growth to inflation. While, according to some consensus exists, suggesting that macroeconomic stability, specifically defined as low inflation, is positively related to economic growth. 2.2 INDEPENDENT VARIABLES 2.2.1 INFLATION RATE (INF) Inflation on economic growth continues to be an important and complex topic in economics. If inflation has real economic effects, then governments can influence economic performance through monetary policy. Therefore, investigating how inflation affects economic growth pertains directly to the optimal design of monetary policy. According to Andres and Hernando (1999), for example, reducing inflation by one percentage point when the rate is 20 percent which results in an increase in the growth rate of 0.5 percent, compared to reducing inflation by one percentage point when the inflation rate is around 5 percent, which results in a decrease in the growth rate by 1 percent. Furthermore, a study by Mallik and Chowdhury (2001), the structuralisms argue that inflation is necessary for economic growth, whereas the monetarists argue the opposite, that is, inflation is detrimental to economic growth such debate started in the 1950s, focused on developing countries, which had long suffered fro m low-growth rates with high rates of inflation and larger deficits in the balance of payments. In order of inflation, the monetarists argue that price stability promotes economic growth and protects the balance of payments. They argue that inflation is major sources of economic instability because it weakens incentives for work and production, distorts the allocative efficiency of the market mechanism, erodes international competitiveness of the domestic industry, and reduces growth potential. They also argued that inflation damages economic growth by lowering domestic and foreign savings, reducing efficiency of resource allocation, and deteriorating the balance-of-payments. To monetarists, stable prices are the starting point in the process of economic development. The policy choice of a country would be stabilization with growth, or stabilization without growth. Several papers are typical of the monetarist tradition. To argue that, according to Fischer and Modigliani (1980) suggested a negative and nonlinear relationship between the rate of inflation and economic growth through the new growth theory mechanism proposed a model where the agents decide the level of labor output, and an increase in inflation reduces labor supply, and producing a decrease in economic production. On the other hand, a study by Mundell and Tobin (1965), the structuralizes argue that inflation normally accompanies economic growth in developing countries because structural rigidities and bottlenecks in supply sectors prevent the elastic supply of some basic commodities such as food, housing, energy, and transportation. Increased income as a result of growth would expand demand for such basic commodities, and prices would rise. The structuralize position is that economic difficulties in developing countries have roots deeper than just the results of inflation. Thus, structuralizes thought that inflationary pressures and det erioration in the balance of payments inevitably are attendant matters of economic growth. In developing countries, there thus would be a trade-off relationship between economic growth and inflation and an attendant deterioration in balance of payments. If a developing country wants stabilization of prices and balance of payments, it must reduce the speed of economic growth, including a sacrifice of employment. Among scholars who support the structuralize position on a positive relationship between inflation and economic performance, predict a positive relationship between the rate of inflation and the rate of capital accumulation, which in turn implies a positive relationship to the rate of economic growth. But, DeGregorio (1996) and Fischer (1926) pointed out, since money and capital are substitutable, an increase in the rate of inflation increases capital accumulation by shifts in portfolios from money to capital and thereby stimulate a higher rate of economic growth was the first to establish a negative correlation between inflation and unemployment. According to Grier and Grier (2006), it presents evidence on the real effects of inflation and inflation uncertainty on output growth. Their main findings are as follows: Inflation uncertainty has a negative and significant effect on growth Once the effect of inflation uncertainty is accounted for, lagged inflation does not have a direct negative effect on output growth; and As predicted higher average inflation raises inflation uncertainty, and the overall net effect of average inflation on output growth. Differ with theory of Bortis, H. (2004), he argues that inflation is a macroeconomic phenomenon represented by a gap between global supply and global demand. Inflation affects the money-output relationship, as does deflation; both phenomena modify the purchasing power of money over domestic output. In this view, price indices cannot come to grips with the inflation phenomenon. While Cheng and Tan (2002) in their study inflation in Malaysia, suggested that main factors affecting Malaysian inflation were external (foreign trade, foreign direct investment and technology transfer). Malaysia has been comparatively successful in balancing strong economic growth with moderate levels of inflation in the periods preceding and following the Asian Financial crisis. Actually, empirical results related to low and medium inflation are of a mixed nature; some papers (mainly these analysing the developed economies) argues that moderate inflation negatively affects growth (e.g. Alexander, 1997, Gillm an et al. 2002; Gillman and Harris 2009; Gillman et al. 2001; Fischer 1993; De Gregorio 1992 and 1993) while other argues that moderate inflation is actually stimulating growth. On the theory side Friedman (1977) in his Nobel lecture argues that a positive relationship between the level of inflation and inflation uncertainty. Friedman points out higher inflation leading to greater uncertainty, which lowers welfare and efficiency of output growth. On the other hand, Ball (1992) formalizes Friedmans hypothesis using an asymmetric information game where public faces uncertainty regarding the type of policymaker in the office. One of the policymaker is willing to tolerate a recession to reduce inflation and the other is not. During the low inflation time, both type of policymakers will attempt and try to keep it low. But, when inflation is high, only the tough type or anti-inflation policymaker will bear the economic costs of disinflation. The argument that central banks should emphasize holding down inflation comes from the beliefs that inflation has an adverse effect on macroeconomic variables, such as output and productivity growth. According to Clark (1982), inflation causes misperception of the relative price levels and leads to inefficient investment plans and therefore affects productivity inversely. Furthermore, inflation erodes tax reductions for depreciation and raises the rental price of capital, which in turn causes a reduction in capital accumulation and therefore in labour productivity. In addition, according to Feldstein (1982) inflation disrupts investment plans by imposing a higher tax rate on corporate profits and through higher effective tax rates on corporate income and accordingly affects productivity (Gilson, 1984; Boskin et al., 1980). Finally, inflation distorts price signals and reduces the ability of economic agents to operate efficiently (Smyth, 1995). According to Chen and et al. (1991), it has documented a significant relationship between the US stock returns and real economic variables such as industrial production, real GNP, interest rates, inflation and money supply. Besides that, there are also otherwise arguments that there is no relation between inflation rate and gross domestic product in the long run. For instance, Faria and Carneiro (2001) investigate the relationship between inflation and output in the context of an economy facing persistent high inflation and they find that inflation does not affect real output in the long run, but that in the short-run inflation negatively affects output. In addition, scholars such as Sidrauski (1967) suggest that there is no relationship between inflation and economic growth, supporting the hypothesis of super neutrality of money. On the other hand, Sarel (1995) asserts that there is a nonlinear relationship between inflation and economic growth. Using 87 countries, he finds the existence of an inflation threshold of 8 percent. Above the threshold there is a negative relationship between inflation and economic growth, whereas under the threshold there is a positive but not significant relationship. The others studies in order to prove Sarels result, Judson and Orphanides (1996) divide Sarels sample of countries into three groups, and they find similar results to Sarel, finding a threshold of 10 percent. Ghosh and Phillips (1998a, b) study 145 countries in the period 1960-1990 again finding similar results. Paul et al. (1997) study 70 countries (of which 48 are developing economies) for the period 1960-1989. They find no causal relationship between inflation and economic growth in 40 percent of the countries, bidirectional causality among 20 percent of the countries, and unidirectional causality for the rest (either inflation to growth or vice versa). Lastly, Mendoza (1998) finds that inflation has had no effect on Mexicos long-run economic growth since he conducted the study of inflation in Mexico. 2.2.2 EMPLOYMENT Some of studies have been conducted to examine the relationship between gross domestic product and employment. For instance, according to Okun (1962) and Philips (1958), they found different relationship both of these. Okun found a negative correlation between unemployment and economic growth, then from both propositions it can be deduced a positive relationship between economic growth and inflation while Phillips proposed a positive relationship between inflation and unemployment implying the same type of relationship. In addition, Boltho and Glyn (1995) found elasticities of employment with respect to output growth in the order of 0.5 to 0.6 for a set of OECD countries. While according to Evangelista and Perani (1996) discovered evidence suggesting that restructuring of major economic sectors reduce the relationship between economic growth and employment. A specific research conducted by Seyfried, W., among the G7 countries (Canada was excluded), a positive and significant relationship between growth in value added and employment was found only in Germany and the US. In addition, according to Verdoon (1949) and Kaldor (1966), an increase in output growth of 1 percent leads to an increase in productivity and employment growth of half a percentage point each. It should be noted that the higher the productivity effects of growth, the more difficult it will be to keep unemployment from rising. According to Okuns Law an increase of the economic growth rate by 3 percent (above the normal rate) was expected to reduce the unemployment rate by 161 percentage point. Or, to put it the other way round: The gain of real GDP associated with a reduction in unemployment of one percentage point was estimated to be 3 percent. Several studies also have been conducted to examine the correlation exists between employment and inflation rate. One of the studies by Spithoven, A.H.G.M. (1995), by the end of the 1960s evidently there was no fixed relationship between unemployment and inflation. Empirical research revealed that the relationship was not consistent over time and varied sharply between countries. This was explained as follows: in the short run higher nominal wages attract more labour and engender a fall in the rates of unemployment. As soon as the workers recognize the wage rise to be purely nominal they abstain from work, and unemployment is restored to the pre-wage-rise level, but with a level of prices higher than before. Secondly, according to Brenner (1991), confronted with a combination of unemployment and inflation (stagflation), many governments abandoned efforts to regulate the economy by the Keynesian instruments. They declared fiscal policies ineffective and sought refuge in a mixture of m onetary measures with supply-side economics. According to Keynes (1946), the volume of employment is given by the point of intersection between the aggregate demand function and the aggregate supply function. This was naively interpreted and construed to imply that a rise in costs à ¢Ã¢â€š ¬Ã¢â‚¬Å" and with this was meant a rise in costs owing to increasing government expenditure à ¢Ã¢â€š ¬Ã¢â‚¬Å" will result in an upward shift of the supply curve and will cause greater unemployment and inflation. CHAPTER 3 RESEARCH METHODOLOGY AND DESIGN 3.1 MODEL SPECIFICATION This study is to examine the correlation exists between inflation rate and total employment with gross domestic product. It uses secondary data which is based on time series data. The collection of time series data from 1982 to 2006 and the scope is in Malaysia. The researcher applied STATA software to process the data and log-log model in this study. The model applied a log transformation, since log transformations help, at least partially, to eliminate the strong asymmetry in the distribution of inflation (Sarel, 1995) and (Ghosh and Phillips, 1998a, b). The logarithm equation is written in the Equation 3.1. GDP = ÃŽÂ ± + ÃŽÂ ²1In(INF) + ÃŽÂ ²2ln(EMP) + ÃŽÂ µ (Equation 3.1) Where, GDP = Gross Domestic Product ÃŽÂ ± = Constant ÃŽÂ ²1 = Inflation ÃŽÂ ²2 = Employment ÃŽÂ µ = Error term In above equation, it shows clearly dependent variable that has been applied in this study is gross domestic product, besides that, the researcher also used two independent variables which are quantitative variables, they are inflation rate and total employment. 3.1.1 DEPENDENT VARIABLE The dependent variable is the variable of primary interest to the researcher. The researchers goal is to understand and describe the dependent variable, and to explain its variability, or predict it (Sekaran, 2006). Dependent variable of this study is factor contributed to the gross domestic product. According to Zikmund (2000), independent variable is a criterion that predicted or explained. It show that the component contributed to improving of gross domestic product depend on the listed independent variables. 3.1.2 INDEPENDENT VARIABLES According to Zikmund (2000), independent variables that expected to influence the dependent variable. Refer to (Burn and Bush, 2000), independent variables are those variables over which the researcher has some control and wishes to manipulate. In this study, two independent variables will influence the dependent variables. They are inflation rate and employment. 3.2 DATA SET AND METHODOLOGY The collections of data in this research only gain from secondary data and based on time series data which are from 2000 to 2010. The researcher has considered annual data of real GDP, inflation rate and employment. All the data on the growth rate of real GDP, Inflation and total employment were obtained from Department of Statistics Malaysia database. GDP is considered per capita. In addition, according to Aigenger (2005) per capita real GDP is also used as an alternative measure of productivity, as some theoretical models do. Moreover, according to OECD (2001), living standards as represented by per capita income reflects productivity since the former is determined, to a significant extent, by the latter. CPI consider in weight 100 while employment in number of labor. The variables were selected based on relevant economic theories that allow for the interaction among inflation rate and total employment in addition to response to GDP. 3.3 TECHNIQUE ANALYSIS DATA In this research, the researcher has applied unit SPSS in order to determine time series data is stationary or non stationary about the correlation between inflation rate and employment with gross domestic product. The researcher examines the existence of a long-run relationship between inflation and employment with GDP using a vector error-correction model (VECM) after applying Johansens (1988, 1990, and 1995) cointegration technique. We conduct a test for weak exogeneity in order to do inference. Then, the researcher conduct stability test by using Jarque Bera test in order to test normality distribution between the variables selected. Finally, a modified version of the Granger causality test is applied in order to analyze causality between the variables. 3.4.1.1 Multiple Regression Analysis Multiple Linear regression analysis is an analysis of the relationship between one variable (dependent variable) and set of variable (independent variables). It is used by the researcher to test the hypothesis. As in all hypothesis tests, the goal is to reject the null hypothesis and accept the alternative hypothesis. This technique will identify how much of the variance in the dependent variables can be explained by independent variables. This analysis is used primarily for the purpose of prediction. The regression model can be used to predict the value of the proposed model in the study is: GDP = f (INF, EMP) GDP = ÃŽÂ ± + ÃŽÂ ²1 Inflation+ ÃŽÂ ²2 Employment + ÃŽÂ µ Where, GDP = Gross Domestic Pr