Contracts Common Law Civil Law I Evolved in England n Code napoleon Based on n Detailed set of laws I Tradition organized into Codes Precedent Europe Custom Russia United states Japan Contracts tend to be 80 countries long Short contracts McGraw-HillIrwoin @2003 The McGraw-Hill Companies, Inc, All Rights Reserved
McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. 2-1 Contracts Common Law Evolved in England Based on: Tradition Precedent Custom United States Contracts tend to be long Civil Law ‘Code Napoleon’ Detailed set of laws organized into ‘Codes’. Europe Russia Japan 80 countries Short contracts
Differences in Economic Development Gross National Product(GNP) Common yardstick for measuring economic activit I Measures total value of goods and services produced annually Both give Doesn't consider the differences in costs a static of living picture of development Purchasing power parity I Uses U.S. cost of living for basis of adjustment among countries McGraw-HillIrwoin @2003 The McGraw-Hill Companies, Inc, All Rights Reserved
McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. 2-2 Differences in Economic Development Gross National Product (GNP) Common yardstick for measuring economic activity. Measures total value of goods and services produced annually. Doesn’t consider the differences in costs of living. Purchasing Power Parity. Uses U.S. cost of living for basis of adjustment among countries. Both give a static picture of development
L垂 GNP per Capita in U.S. Dollars Low Income: $755 or less Lower Middle Income: $756-$2 995 ■M090s Lower High Income: $9, 266-$20,000 Upper High Income: $20,001 or more No data The values for the class intervals above are taken from the World Bank's cutoff figures for high-inccme, upper-middle-income, lower-middle income, and low-income economies. scae.1to1800000 3000 Kicmeers
McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. 2-3
PPP Index and GNP Data for Selected Countries 2000 Country GNP/ Capita PPP/Capita GNP Gr Brazil 3570 7,320 3.0 China 840 3,940 10.7 Germany 25.050 25.101 1.3 工ndia 460 2.390 6.0 Japan 34210 26,460 1.3 Nigeria 260 790 2.4 Poland 4,200 9.030 4.5 Russia 1.660 8.030 6.1 Switzerland 38.120 24,970 0.6 United Kingdom 24.500 23.550 2.5 Unired States 34.260 34.260 3.3 Table 2.1 McGraw-HillIrwoin @2003 The McGraw-Hill Companies, Inc, All Rights reserved
McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. 2-4 PPP Index and GNP Data for Selected Countries 2000 Country GNP/Capita PPP/Capita GNP Growth Rate (%) 90-99 Brazil $3,570 $7,320 3.0 China 840 3,940 10.7 Germany 25,050 25,101 1.3 India 460 2,390 6.0 Japan 34,210 26,460 1.3 Nigeria 260 790 2.4 Poland 4,200 9,030 4.5 Russia 1,660 8,030 -6.1 Switzerland 38,120 24,970 0.6 United Kingdom 24,500 23,550 2.5 United States 34,260 34,260 3.3 Table 2.1
Purchasing Power Parity In international dollars Low Income: S1,990 or less Lower Middle Income: S1.991-$4.580 Upper Middle Income: $4, 581-$9, 170 Lower High Income: S9, 170-S20,000 Upper Middle Income: $20,001 or more No data 2000 Miles scae.1to1800000 10002000300 meters
McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. 2-5
Average Annual Growth Rate GNP:1990-1997 Less than 0.0% 0.0%-0.9% ■10%-19% 20%-29% 30%-39% More than 4.0% □ No data 10002000Mks scae:1to18000.00 10002003000 Kicmetar
McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. 2-6
:, Levels of Human Development High Human Development 0.801-1,00 Higher Medium Human Development 0.651-0.800 Lower Medium Human Development 0.500-0.650 Low Human Development Less than 0.50 Scale: 1 to 180.000 000 20033000(0mer
McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. 2-7
Geography Education and Economic Development that throughout history, coastal states, with their long engagements in international trade, have been more supportive of market institutions than landlocked states which have tended to organize themselves as hierarchical (and often military) societies. Mountainous states, as a result of physical isolation, have often neglected market- based trade. Temperate climes have generally supported higher densities of population and thus more extensive division of labor than tropical regions Jeffrey Sachs The general assertion is that Harvard University nations that invest more in education will have higher growth rates because an educated population is a more productive population McGraw-HillIrwoin @2003 The McGraw-Hill Companies, Inc, All Rights Reserved
McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. 2-8 Geography, Education and Economic Development “..that throughout history, coastal states, with their long engagements in international trade, have been more supportive of market institutions than landlocked states, which have tended to organize themselves as hierarchical (and often military) societies. Mountainous states, as a result of physical isolation, have often neglected marketbased trade. Temperate climes have generally supported higher densities of population and thus more extensive division of labor than tropical regions.” Jeffrey Sachs Harvard University The general assertion is that nations that invest more in education will have higher growth rates because an educated population is a more productive population
The spread of Market-Based Systems Central Planned Economies Market Shift Based Economies Mixed Economies McGraw-HillIrwoin @2003 The McGraw-Hill Companies, Inc, All Rights Reserved
McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. 2-9 The spread of Market-Based Systems Shift Centrally Planned Economies Mixed Economies Market – Based Economies
2-10 The Nature of Economic Transformation The shift to market-based economies entails Deregulation Removal of legal restrictions to free markets Privatization I Transfer of state ownership of property into private hands Legal Systems I Creation of systems to protect property rights McGraw-HillIrwoin @2003 The McGraw-Hill Companies, Inc, All Rights Reserved
McGraw-Hill/Irwin © 2003 The McGraw-Hill Companies, Inc., All Rights Reserved. 2-10 The Nature of Economic Transformation The shift to market-based economies entails: Deregulation Removal of legal restrictions to free markets. Privatization Transfer of state ownership of property into private hands. Legal Systems Creation of systems to protect property rights