Why is Pakistan counted as underdeveloped?

Why is Pakistan counted as underdeveloped? Right now, Rs. 52,941 is the debt which is on the shoulders of each and every Pakistan, where total external and internal debt Pakistan today accountable is Rupees Nine trillion. Where as in the mid-nineties, the same figure was Rupees 30,000 which was to be borne by each Pakistani citizen. The government of PM Nawaz Shareef came up with an initiative of Qarz Utaro Scheme which somehow gave a relieving cushion to the debt servicing piles. Right now there is a total financial dichotomy in the country. In these worsening situations, it is again said that national treasury is facing an additional burden of Rupees 14 billion due to 12 percent increase in military pensions in 2007-2008  [3]  . On the other side of the coin, futuristic look is giving much cynical and gloomy representation as the total external debt is likely to soar by more than 43 per cent over the next five years, to about $73 billion in 2015-16 from about $50.76 billion early this year  [4]  . Though the incapability and powerlessness of numerous countries to use the provided external supply in terms of aid or debt, it is further attributed to many other characteristic factors, the insufficient and scarce absorptive competence is termed as the rule of thumb applicable in many UDCs as a limitation on the well-organized and proficient utilization of external resources. The normal debt indicators which are commonly practiced in Pakistan are: Debt : GNP ratio Debt : Debt Service Liability Debt : Foreign Exchange Earnings CHAPTER II LITERATURE REVIEW (Ashfaq, 2005) in his research (Aid Effectiveness, Debt Capacity and Debt Management in the Economy of Pakistan) discusses that discrete views are prevailing concerning the usefulness of external assistance to the UDCs. As many of the researchers and economist say that aid and debt is much useful in lessening the monetary tailback and blockage to enlargement of many developing countries like Pakistan, no matter the essence of taking assistance is satisfied or not (for example Cassen 1994, G. Papanek 1972, etc). The challengers declare that foreign assistance either in terms of aid or debt always caused disastrous affects on the maturity of the recipient country. A number of gives a moderate point of views on the same debate. The association linking external debt and economic escalation has been observed broadly in recent years. These studies have mostly focused on the destructive influence of a countrys debt overhang which means the addition of a stockpile of liability so hefty as to terrorize the countrys ability to pay back its precedent loan. The theme of the research is to see how and to what degree the foreign assistance has and debt affected the economy. It is to analyze the external assistance and resources in terms of its dynamic and fruitful role in the economy and as a bridge of expansion and growth or vice versa. The main idea is to check and estimate the effectiveness of foreign air and external debt in the country and the researcher seek to determine whether further resources linked with external assistance have in point of fact brought some kind of revolution in the economy or the situation is completely opposite of what it should be. The research will also investigate the position of debt lumber on Pakistan, giving extreme importance given on Pakistans competence in debt servicing and its retirement; in the light of major problems in debt management practices creating worst economic shape of the country. ( Hayat et al, 2010) discuss in their research (External debt and Economic Growth: Empirical evidence from Pakistan) of the known fact to everyone that Pakistan does not enjoy a good repute for aid and external debt. It has almost unmatchable witnesses of significant economic assistance from about each part of the globe. He further argues that Since Pakistans emergence of world map; it is facing crucial problems in balance of payments deficit. To finance this balance of payments deficit and loses, Pakistan is heavily relying on external debt. World Bank classified Pakistan as severely indebted country of South Asia in 2001.Even though, Pakistan shows a mushroom growth in its economy in the presence of serious economic and highest degree of political in-stability. Although it also showed variability with the passage of time but the situation at this point in time is worse where the growth rate of GDP is just 2% which was 7% in 2007. The outstanding stock of external debt swelled by a huge sum of Rupees 1095.1 billion in FY09, registering a growth of 36.1 percent against 28.9 percent in FY08. As far as debt is related, International Monetary Fund (IMF) debt further damager the condition. The rise in debt stock of IMF by US$ 3.8 billion was the major factor for rise in total debt stock during FY09. As discussed earlier, facing severe balance of payments problems the government had approached the IMF for a US$7.6 billion Stand-By Arrangement (SBA) loan which was approved by the IMF board in November 2008. The IMF has also acceded to government of Pakistans additional request for US$3.2 billion, which has increased the total assistance to $11.3 billion. The bad and declining economic conditions also creates problems in Pakistan foreign exchange re serves. It was $ 14 Billion in June 2007 showing a drastic decline of 75.71% by the mid of 2010 to just $ 3.4 Billion. Prior to the events of September 11, 2001, Pakistans economy was caught in a vicious debt trap. U.S. bilateral aid to Pakistan started in 1951. Pakistan, in total, received a massive amount of $2 billion dollars between 1953 and 1961. On the other side, by the early 1960s, aid reached $400 million per year. At the peak level, we get to know that in the first phase of the same decade, only United Stated provided fifty percent of the total aid Pakistan was receiving; which covered one third of the development budget and financed more than half of the import bill. It was the time by 1982, US was givibg $ 5.1 Billion to Pakistan as aid on annual basis. (Ibrahim, 2009) in his research (U.S. aid to Pakistan-U.S. Tax payers have funded Pakistani corruption) discussed the situation getting further worse when sanctions were imposed by the G-8 countries on bilateral and multilateral lending as a consequence of Pakistans nuclear tests in May 1998 and subsequently because of the military coup in October 1999. Pakistan was able to reschedule US $ 3.96 billion of its bi-lateral liabilities through the Paris Club in 2000. The reschedule was, however, on short-term basis and dependent on the IMF agreement, which was being finalized at the time with all its stringent conditionality. The post September 11, 2001, events once again brought Pakistan into the limelight of global geo-strategic interests. The most significant benefit which Pakistan attained vis-à  -vis its external debt problem was the restructuring agreement with the Paris Club in December 2001. Under the agreement, the debt repayment period was extended to a span of 38 years with a grace period of 15 years. This means that Pakistans debt servicing liabilities will decline by US $ 2.7 billion between 2002 and 2004 and according to the State Bank; the net present value of external debt is expected to decline somewhere between 27 and 43 per cent between 2002 and 2017. All these problems faced by Pakistan are quite alarming and shows a need of taking massive and severe steps to take the position in a controllable mode, as further delay will make Pakistan drift herself into many other financial as well as social issues. (Ahmed, 2010) argued that Pakistan must refuse to pay foreign debt payment and spend the same amount on relief and rehabilitation of people affected from recent flood and terrorism. He said that 20 Million populations have got effected from the angry flood which are a crucial part of $ 54 Billion foreign debt yet to be paid back with interest. People in Pakistan are already facing unemployment, hunger and worst hardships and the episode of the flood creating massive problems for such a huge number of populations is again devastating. Therefore, Pakistan is greatly unable to service its debt liability. Pakistan spends $ 3 Billion every year on its debt servicing where Pakistans debt-to-GDP ratio has skipped the massive height of 61% this fiscal year. Government is sometimes talking of cutting development budget and reduces subsidies on the call of IMF. The situation according to him is getting more badly where Government is talking about levying flood tax on the poor people of Pakista n. Despite of taking such steps, Pakistans government should take serious steps in the eradication of such problems by cutting military and capital budgets. (Haider Mullick, 2004) discusses the fact that though Pakistan has been a front-line ally to The United States for the war on terrorism to curb the threats on the US soil; but received a sum of $2.4 billion in foreign aid  [5]  . He further argues that after the terrorist attacks on the WTC on September 11, 2001 many of the rich and developed nations pondered over the fact that foreign aid to UDCs has now turned to a new phenomenon with a blend of new priority and importance unlike previous times. All is due to the reason of such UDCs falling into the hands of radical extremists and fanatics which finance the poor and misuse their status of poverty. It is just due to the Pakistans involvement to help the US and NATO forces to defeat the Taliban regime in Afghanistan and the US are allocating massive aid in an injecting manner similar to 80s. But the end result could become much fierce. There can be a financial dead-lock in the country if the US and NATO move out of the Afghan lan d in next 10 years. Our system in Pakistan will be so dependent on the aid and grants that when it will be removed; there is a growing fear of over all system-collapse. He stresses on the immediate need of autarky and self dependence like India and China. (Martin, 2009) writes in his research about Pakistan Capital Crisis that Pakistans government has reached to an agreement with the International Monetary Fund (IMF) for a sum of $ 7.6 B in the form of loans followed by massive hefts of impositions on the economy of Pakistan. Despite of the huge sum, Pakistans financial dichotomy still persists and the state has requested additionally for a sum of $ 4.5 billion. He states that Pakistan badly affected capital situation is affecting the nations over all economic efficiency and performance leading towards socio-political havoc. He further extends his argument to the debt burden Pakistan is getting in such monetary and socio-economics problems that it will become very difficult for a common Pakistani to win bread for his family. He discusses about different research groups which have recently issued reports on the prevailing circumstances in the country that further recommends on the actions that the United States can do to help an improv ed economic system. He indicates the role of Congress that may consider many of the recommendations and take severe actions to increase in USs non-military assistance and establishment of reconstruction opportunity zones in the country. It is barely on the mercy of time which will show the effectiveness of what such recommendations will bring; prosperity or disaster. The US is interested in a firm and established democratic Pakistan which can act as a front-line ally to the US interests in Afghanistan and South Asia. The US wants to assist Pakistan on the basis of regional and global terrorism which is the major threat to the US after September 11, 2001. Now, the US think-tanks are pondering over the fact that a financial stalemate in the country will might weaken multilateral endeavors to soothe South Asia and restrain the growing emergence of Islamic extremism; so there is an immediate need of capital assistance in a rapid and quick way. (Momani, 2004) discusses the Triad focusing on Pakistan, The IMF and The U.S. War on Terrosism. She argues the basic question that did The U.S intrude to approve the final payout of Pakistans IMF as a prize to support the United States war on terrorism? It is a rule of thumb that The IMF has been always politicized to attain foreign policy objectives which are important to the U.S. It is a matter of fact that Pakistans loans approval was immediately given after 9/11 attacks by the IMF but was scheduled for the approval by the executive board of IMF. The overall situation gets clumsy as there are strong and positive linkages of the United States influence inside the decision makings of The IMF to strongly correlate objectives getting success in the end- Exactly what The United States have been doing to all Under developed countries (UDCs) across the globe. Although there are weak evidences present of the USs influence in the case of Pakistan but the writer argues that The United State s clearly wanted to take a credit for the approved payment by the IMF to the country, getting General Musharraf as a front line ally to attack Afghanistan. (Hameed et al , 2008) discuss how external debt and aid is deteriorating the fiscal and monetary policies of Pakistan. In their research that even in short run or long run; the relationship between debt shamble and economic growth is always negative in the Pakistans history until now. It is clear to every one that debt and debt servicing responsibilities always bring negative productivity as far as labor and capital is concerned. Now, the relationship is causal to the fiscal deficit in the country. When there is a problem in the labor and productivity, there is always a negative impact on the taxation base. On the other hand there are severe problems prevailing as people always look to avoid or evade taxes. The researchers also focused on the need of cutting the above mentioned expenditures drastically so that there should be an adequate cushion given to the injured fiscal structure of the country. They also stressed on the reality that debt service relation tends to affect negativel y GDP and thereby the rate of economic growth in the long-run, which, in turn, reduces the ability of the country to service its debt. Now tax being the foremost and crucial part of the fiscal structure as revenue plays a very important element as far as the capital, development and military expenditures are in question. The researchers claim that external debt is not good for a country in general and Pakistan particularly after a certain limit as piles of interest has to be returned back which further deteriorate the fiscal structure of the country. (Hashmi, 2009) worked on the reflections of Pakistans economy due to the war on terror. On the other hand she also focused on the mutual relationship between the fiscal discrepancies and Pakistans involvement in the War on terror as an ally of the United States. As matter of fact, Pakistan was a heaven for most of the world most renowned investors which always saw Pakistan as place where huge piles of profits are present. There were and still ate many latent demands which people want in their life. Consequently, many of the Multinational companies and other world class organizations were interested in setting up business in Pakistan and importing the raw material in the field of textiles and other services into their own countries. With the invasion of NATO and US troops in Afghanistan, the situation was worse than ever before in the history of Pakistan. All of a sudden all the investors from Pakistan flew away taking all their capital and investment out of the country. Stock markets crashed as due to the war in Afghanistan, all the foreign investors were afraid of loosing their huge chunks of virtues; the virtues which in the end makes Pakistan generates heavy amounts of taxes being used as revenue for the state. There is a worse fiscal and monetary gridlock in the country after facing much socio-economic and political instability. (Burki, 2008) applies the political economic analysis of decision making processes in the donor country to the special case of US aid to Pakistan. Pakistan is not an extremely poor country but nevertheless, it is among the 5 major recipients of foreign aid. Over the last decades, Pakistans aid receipts show considerable shifts for which no obvious development related reasons can be provided. This calls for explanations related to reasons other than developmental efficiency which require a closer look at decision making processes on the donor side. Looking at the United States as the single most important bilateral donor, we draw upon earlier analyses of the effect of lobbying on congressional decision making. Numerous studies, like Coughlin (1985), Tosini and Tower (1987), Harper and Aldrich (1991), Marks (1993) and Baldwin and Magee (1998) empirically tested the hypothesis of domestic lobbies affecting congressional voting behavior with respect to US trade policy. A more recent stud y by Gawanda et al. (2004) also includes the effect of lobbies working for foreign principals, e.g., for foreign governments and foreign business groups. As a result, the external assistance Pakistan has been given was all on the basis of political interests of the donor countries and show minimal or negligible improvement in the economic and fiscal structure of the country. Over the years, the sums of aids and external debts have been getting a sky-high increase but the monetary situation is worse since 1947. He argues that there is a negative relation of aid and foreign debt with the economic uplift of a country, especially in Pakistan where the situation is quite different due to its involvement in war on terror, prevailing corruption, and no productivity due to energy crisis, Minimum subsidies and The IMFs impositions on the poor Pakistani. Results from ineffective use of the money show that unidirectional causality runs from the foreign exchange constraint to the budget deficit and then from the budget deficit to the external debt stock. Bi-directional causality was observed between foreign exchange requirements and the external debt stock. Chapter III 3.0 Theoretical Framework CHAPTER IV METHODOLOGY AND CHOICE OF ANALYTICAL TECHNIQUE 4.1 Research type In order to conduct my research study the most suitable data I have gathered is secondary in nature collected from reliable and consistent data sources and no primary data has been collected, hence my study will be referred to as secondary research. 4.2 Data type Reference Period Data type is purely secondary in nature as no primary data has been acquired. Reference period for my research is from 1995-2009 Research Hypothesis 4.3.1 Basic Research Hypothesis First Hypothesis Ho: External aid and debt has a negative correlation with the GDP growth in Pakistan from 1995-2009 HA: External aid and debt has a positive correlation with the GDP growth in Pakistan from 1995-2009 Second Hypothesis Ho: Economic growth will not be continual by rising external debt and foreign aid to Pakistan HA: Economic growth will be continual by rising external debt and foreign aid to Pakistan 4.3.2 Statistical Hypothesis Grants as a percentage of GDP H0: To test the hypothesis that Grants as a percentage of GDP has no negative on External debt as a percentage of GGP H0:ÃŽÂ ²1=0 H1: To test the hypothesis that Grants as a percentage of GDP has negative impact on External debt as a percentage of GGP H1:ÃŽÂ ²1à ¢Ã¢â‚¬ °Ã‚  0 Foreign Direct Investment H0: To test the hypothesis that FDI as a percentage of GDP has insignificant no negative on External debt as a percentage of GDP H0:ÃŽÂ ²2=0 H1: To test the hypothesis that FDI as a percentage of GDP has negative impact on External debt as a percentage of GDP H1:ÃŽÂ ²2à ¢Ã¢â‚¬ °Ã‚  0 Debt Servicing H0: To test the hypothesis that Debt servicing as a percentage of GDP has no positive impact on External debt as a percentage of GDP H0:ÃŽÂ ²3=0 H1: To test the hypothesis Debt Servicing as a percentage of GDP has positive impact on External debt as a percentage of GDP H1:ÃŽÂ ²3à ¢Ã¢â‚¬ °Ã‚  0 Trade Deficit H0: To test the hypothesis that Trade Deficit as a percentage of GDP has no negative impact on External debt as a percentage of GDP H0:ÃŽÂ ²4=0 H1: To test the hypothesis that Trade Deficit as a percentage of GDP has negative impact on External debt as a percentage of GDP H1:ÃŽÂ ²4à ¢Ã¢â‚¬ °Ã‚  0 Fiscal Deficit H0: To test the hypothesis that Fiscal Deficit as a percentage of GDP has no negative impact on External debt as a percentage of GDP H0:ÃŽÂ ²5=0 H1: To test the hypothesis that Fiscal Deficit as a percentage of GDP P has negative impact on External debt as a percentage of GDP H1:ÃŽÂ ²5à ¢Ã¢â‚¬ °Ã‚  0 Saving Investment Gap H0: To test the hypothesis that Saving- Investment Gap as a percentage of GDP has no negative impact on External debt as a percentage of GDP H0:ÃŽÂ ²6=0 H1: To test the hypothesis that Saving- Investment Gap as a percentage of GDP P has negative impact on External debt as a percentage of GDP H1:ÃŽÂ ²6à ¢Ã¢â‚¬ °Ã‚  0 3.4.1 Variable reference list Dependent Variable External Debt as a percentage of GDP (Malik, 2010) Independent Variables Fiscal Deficit as a percentage of GDP* (Ashfaq, et al 1999) Foreign Direct Investment as a percentage of GDP* (Azam et al, 2009) Balance of Payment as a Percentage of GDP* (Loser, 1977) and (Malik et al, 2010) Exchange rate fluctuation (Mahmood et al , 2009) Capital Flight (Chipalkati , Rishi; 2009) Foreign Aid as a percentage of GDP* (Miles B. Cahill, Paul N. Isely) Saving-Investment Gap percentage of GDP (Malik, 2010) Debt Servicing percentage of GDP* (Clement, et al, 2009) Trade Deficit as a percentage of GDP* (Mohammad, 2010) Grants excluding technical assistance percentage of GDP* (Befekadu Degefe ) * as a percentage of GDP is used to gauge the variables in accordance to economic growth of Pakistan Information gathering and sampling procedures Data Sources The data sources for my research study are as follows: WDI Data reliability and internal consistency WDI is a renowned database developed by World Bank. The data from WDI is completely reliable to be used in the research. 3.4.4 Data analysis tools and techniques Multiple regression: To measure the increasing effect of independent variables on the dependent variable and to obtain a single regression line for all variables, which will be further used in hypothesis testing Granger Causality: The researcher would like to identify whether variation in a variable will enclose an impact on changes other variables Scatter Plots: Such plots will also be used for graphical representation of data. 4.1 Statistical Analysis Grants and External Debt Dependent Variable: External Debt as a Percentage of GDP Independent Variable: Grants excluding technical assistance as a percentage of GDP In this relation, the result is significant at 15% level. Keeping all other variables constant, one Dollar change in External debt as a percentage of GDP creates negative 3.83 Dollars in Grants excluding technical assistance (as a percentage of GDP). This is because in many underdeveloped parts of the world, Grants excluding technical assistance is used to finance much governmental expenditure. Also, such grants are also used in debt servicing. As a special case, Pakistan has been using such grants in the same manner. This is because Pakistan has been a key ally to The United States of America for War against Terrorism. The country has been paying much in the form of deficits in each governmental tool. Hence, the lesser Grants given to Pakistan, more piling of external debt will be apparent. T-stat for ÃŽÂ ²1 comes out to be 1.156; where T-Critical is 1.108 at 15% significant level. In this way, the research tends to reject H0, where Hypothesis is: H0: To test the hypothesis that Grants as a percentage of GDP has no negative impact on External debt as a percentage of GGP H0:ÃŽÂ ²1=0 H1: To test the hypothesis that Grants as a percentage of GDP has negative impact on External debt as a percentage of GGP H1:ÃŽÂ ²1à ¢Ã¢â‚¬ °Ã‚  0 Grants and External Debt Dependent Variable: External Debt as a Percentage of GDP Independent Variable: Grants excluding technical assistance as a percentage of GDP In this relation, the result is significant at 15% level. Keeping all other variables constant, one Dollar change in External debt as a percentage of GDP creates negative 3.83 Dollars in Grants excluding technical assistance (as a percentage of GDP). This is because in many underdeveloped parts of the world, Grants excluding technical assistance is used to finance much governmental expenditure. Also, such grants are also used in debt servicing. As a special case, Pakistan has been using such grants in the same manner. This is because Pakistan has been a key ally to The United States of America for War against Terrorism. The country has been paying much in the form of deficits in each governmental tool. Hence, the lesser Grants given to Pakistan, more piling of external debt will be apparent. As the regression equation is: ÃŽÂ ± = 35.0 3.83 ÃŽÂ ²1 2.89 ÃŽÂ ²2 1.87 ÃŽÂ ²3 + 0.581 ÃŽÂ ²4 + 3.10 ÃŽÂ ²5 0.133 ÃŽÂ ²6 T-stat for ÃŽÂ ²1 comes out to be 1.156; where T-Critical is 1.108 at 15% significant level. In this way, the research tends to reject H0, where Hypothesis is: H0: To test the hypothesis that Grants as a percentage of GDP has positive impact on External debt as a percentage of GGP H0:ÃŽÂ ²1=0 H1: To test the hypothesis that Grants as a percentage of GDP has negative impact on External debt as a percentage of GGP H1:ÃŽÂ ²1à ¢Ã¢â‚¬ °Ã‚  0 Grants and External Debt Dependent Variable: External Debt as a Percentage of GDP Independent Variable: FDI as a percentage of GDP H0: To test the hypothesis that FDI as a percentage of GDP has positive correlation with External debt as a percentage of GDP H0:ÃŽÂ ²2=0 H1: To test the hypothesis that FDI as a percentage of GDP has negative correlation with External debt as a percentage of GDP H1:ÃŽÂ ²2à ¢Ã¢â‚¬ °Ã‚  0 As the regression equation is: ÃŽÂ ± = 35.0 3.83 ÃŽÂ ²1 2.89 ÃŽÂ ²2 1.87 ÃŽÂ ²3 + 0.581 ÃŽÂ ²4 + 3.10 ÃŽÂ ²5 0.133 ÃŽÂ ²6 It states that negative change of $ 2.89 in FDI (as a percentage of GDP) adds $ 1 External Debt (as a percentage of GDP. Hence, lesser the FDI, more is the external debt. On the other hand t-stat for ÃŽÂ ²2 is 1.824; where T-Critical is 1.108 at 15% significant level. Since t-stat is greater than t-critical, the researcher tends to reject the null hypothesis which states that FDI (as a percentage of GDP) as a negative correlation with external debt (as a percentage of GDP) Debt Servicing and External Debt Dependent Variable: External Debt as a Percentage of GDP Independent Variable: Debt Servicing as a percentage of GDP H0: To test the hypothesis that Debt servicing as a percentage of GDP has positive correlation with External debt as a percentage of GDP H0:ÃŽÂ ²3=0 H1: To test the hypothesis Debt Servicing as a percentage of GDP has negative correlation with External debt as a percentage of GDP H1:ÃŽÂ ²3à ¢Ã¢â‚¬ °Ã‚  0 As the regression equation suggests: ÃŽÂ ± = 35.0 3.83 ÃŽÂ ²1 2.89 ÃŽÂ ²2 1.87 ÃŽÂ ²3 + 0.581 ÃŽÂ ²4 + 3.10 ÃŽÂ ²5 0.133 ÃŽÂ ²6 A negative change of $ 1.87 in Debt Servicing as a percentage of GDP adds $ 1 External Debt (as a percentage of GDP). Hence, lesser the debt retirement is, the more is the external debt piling is seen in Pakistan (1995-2009) On the other hand t-stat for ÃŽÂ ²3 is 1.442; where T-Critical is 1.108 at 15% significant level. Since t-stat is greater than t-critical, the researcher tends to reject the null hypothesis which states that Debt Servicing (as a percentage of GDP) as a negative correlation with external debt (as a percentage of GDP). Trade Deficit and External Debt Dependent Variable: External Debt as a Percentage of GDP Independent Variable: Trade Deficit as a percentage of GDP H0: To test the hypothesis that Trade Deficit as a percentage of GDP has a positive correlation with External debt as a percentage of GDP H0:ÃŽÂ ²4=0 H1: To test the hypothesis that Trade Deficit as a percentage of GDP has a negative correlation with External debt as a percentage of GDP H1:ÃŽÂ ²4à ¢Ã¢â‚¬ °Ã‚  0 The regression equation suggests that: ÃŽÂ ± = 35.0 3.83 ÃŽÂ ²1 2.89 ÃŽÂ ²2 1.87 ÃŽÂ ²3 + 0.581 ÃŽÂ ²4 + 3.10 ÃŽÂ ²5 0.133 ÃŽÂ ²6 $ 0.581 change in Trade Deficit (Trade deficit increases i.e. Imports>exports) as a percentage of GDP creates a positive change of $ 0.581 External debt as a percentage of GDP. Hence, greater the trade deficit is, the more is external debt evident in Pakistan (1995-2009) On the other hand t-stat for ÃŽÂ ²4 is 1.311; where T-Critical is 1.108 at 15% significant level. Since t-stat is greater than t-critical, the researcher tends to reject the null hypothesis which states that Trade Deficit (as a percentage of GDP) as a negative correlation with external debt (as a percentage of GDP). Grants and External Debt Dependent Variable: External Debt as a Percentage of GDP Independent Variable: Fiscal Deficit as a percentage of GDP H0: To test the hypothesis that Fiscal Deficit as a percentage of GDP has no negative impact on External debt as a percentage of GDP H0:ÃŽÂ ²5=0 H1: To test the hypothesis that Fiscal Deficit as a percentage of GDP P has negative impact on External debt as a percentage of GDP H1:ÃŽÂ ²5à ¢Ã¢â‚¬ °Ã‚  0 The regression equation suggests that: ÃŽÂ ± = 35.0 3.83 ÃŽÂ ²1 2.89 ÃŽÂ ²2 1.87 ÃŽÂ ²3 + 0.581 ÃŽÂ ²4 + 3.10 ÃŽÂ ²5 0.133 ÃŽÂ ²6 $3.10 change in Fiscal Deficit (i.e. Government Revenues > Government Expenses)as a percentage of GDP creates a positive change of $ 1.00 in Pakistans external debt. Hence, greater the fiscal deficit is, the more is external debt is in Pakistan during 1995-2009. On the other hand t-stat for ÃŽÂ ²4 is 1.834; where T-Critical is 1.108 at 15% significant level. Since t-stat is greater than t-critical, the researcher tends to reject the null hypothesis which states that Fiscal Deficit (as a percentage of GDP) as a negative correlation with external debt (as a percentage of GDP). Saving Investment Gap and External Debt Dependent Variable: External Debt as a Percentage of GDP Independent Variable: Saving Investment gap as a percentage of GDP H0: To test the hypothesis that Saving- Investment Gap as a percentage of GDP has positive correlation on External debt as a percentage of GDP H0:ÃŽÂ ²6=0 H1: To test the hypothesis that Saving- Investment Gap as a percentage of GDP P has negative correlation

Innocent Drinks Was Formed Management Essay

Innocent Drinks Was Formed Management Essay Innocent  Drinks was formed in 1998 by Richard Reed, Adam Balon and Jon Wright BBC NEWS Business, 2010. The general idea of the company was to produce 100 fruit, with no water, sugar, concentrated juices or preservatives (GMID, 2012). It is also a firm that is synonymous with healthy lifestyles and ecological ethics.  Innocent  Drinks is now the leader of the smoothie market (see Appendix 2) in the UK, with the Coca-Cola Company owned a 58% of the companys stake (GMID, 2012). Moreover they sold their products in supermarkets, local shops, coffee shops and several other outlets. Furthermore Innocent drinks are now sold in ten European countries (Fast Track 100, 2012). Innocent shows a big interest to achieve the five-a-day in order to improve publics health. Thus, the company is working with Government consultants and nutrition specialists in order to find ways to promote fruit consumption (Marketing Week, 2011). They have shown a big interest about charity and according to the companys official website they donate 10% of their profits to the charity, the majority of which goes to the innocent foundation. Foundation is currently supporting sixteen partner projects mainly in countries where innocent drinks supplies its fruit. They focus on agricultural, because company believes that people should use the natural resources in order to enable a better future (Innocent website, 2012 b). The company emphasise that it is workers show respect for the environment and all the fruits used are 100% eco-friendly produced (Innocent website, 2012 b). Additionally the company have won many awards such as World Juice Award Foodnews World Juice Award for best new product (Apple Juice) on 2011 and Marketing Week Effectiveness Award for New Product of the Year (Kids) on 2010 (Innocent website, 2012 b). In general, smoothie market had a growth in sales and the forecasts were positive until 2007. However due the economic crisis the consumers modified their shopping list and th e revised forecast are not encouraging for the future according to Mintel report in 2009 (see Appendix 1). Figure 1: Business excellence model (Adapted from University of Cambridge Publications, 2012)http://www.ifm.eng.cam.ac.uk/uploads/Research/CSP/Modified_Large.png The business excellence models are frameworks that when operated within an organisation can help to focus ideas and action in a more methodical and structured way that should guide employees to increase their performance.  Moreover those frameworks help the company to introduce its HRM practices and also apply them more effectively. HRM Practices-Best Practices According to Marchington and Wilkinson (2005), best practice HRM is capable of being used in any organisation, irrespective of product market situation, industry, or workforce. There are many activities which human resource is focused on. Examples of HRM practices are recruitment and selection, training and development, employee wellbeing, negotiation, health and safety, payment and reward etc. (Foot and Hook, 2011). The two human resource practices that the Innocent focus on are the Training and Development and Payment and Reward. Training and Development Figure 2: Interaction between different levels of development requirements and the wider corporate planning process (Adapted from Investors in People, 2012 a) There are several methods to achieve the employees progress which are usually extent according to sector and size of the company. The progress within the company can be individually or team based. Additionally the employer has to take into consideration that the development starts form the organisation then moves to the department and finally to the individual (Figure 1). Moreover there is a several methods for the company when it is considering the training and development of both decision-making and non-decision making personnel. The firm can give emphasis to formal training procedures and self-development in order to achieve an improved standard for its employees. The table below illustrates information about the most effective methods for employees to learn. It is remarkable that the majority of them prefer to learn in the work place which Innocent provides during the induction compulsory programme. Employees prefer to learn during the work period instead of self-study through co urses and work experience. Method Percentage On the job 41 Formal Courses 21 The experience of work 15 Coaching/ Mentoring 10 Informal help from colleagues 7 Other 4 E-learning 2 Self-study in own time 1 Table 1: Most Effective way for people to learn (Adapted from CIPD, 2007) The Innocent Company engages this HRM practice and supports it in several ways in order to encourage its employees to work to in the maximum level of their ability. Thus, those practices can act as examples of ways of maximising employee performance. Firstly, the introduction of an induction programme is necessary of a smaller company, whereas a grater company might be providing series of training programmes (Investors in People, 2008). Innocent provides two week induction programme in addition to other courses. For example the Innocent Drinks Company provides two compulsory training programs for its employees such as the innocent academy and the innocent business academy. However, the company provides optional programmes such as Managing your own development and Building expertise in what you do (Innocent website, 2012 b). Compulsory courses: The innocent academy: This is a two day compulsory programme which helps the employee to familiarise with the work environment. This induction course equips the employee with uncomplicated tools and ideas. The general aim of this course is to help the new member of the company to be more valuable and efficient to the workplace. Moreover this is a great opportunity for the employee to meet people who may work way with on a daily basis. Furthermore the employee can listen to the older employees and get a general idea about working in Innocent (Innocent website, 2012 b). The innocent Business Academy (IBA): This is an additional two day course. The companys plan is to teach core business skills to its future employees, for example project management and financial skills. This course occur during the first year at innocent, in case of the employee is at manager level or beyond (Innocent website, 2012 b). Optional Courses Managing Your Own Development: These courses run during the year. They are optional courses designed to give to the employees additional information, guidelines and useful tools in order to managing their ideas, strategies and strengths in addition to planning the next move (Innocent website, 2012 b). Building expertise in what you do: The Company is divided to many small teams. Each team has an aim to do its best to hold the Innocent to the highest level. For example sales team focuses to the methods of negotiation, and technical team focus on the latest methods for keeping the drinks safe from bacteria and microbes. Moreover some other teams have to study for professional exams in order to improve their skills (Innocent website, 2012 b). Payment and Reward for Employees According to CIPD (2009), approximately a quarter of employers have a reward strategy in their company. Based on Investors in People (2012 b), there are several ways of rewarding people such as one-off bonus payments for personal performance, commissions, performance related pay, profit related pay, competency based pay, employee share scheme, benefits and non financial approaches. One-off bonus payments for personal performance: In addition to salary each employee can get an extra bonus for the achievement of the annually goals. Commission: This reward refers more to the sales team. The commission price depends on their achievement of effective selling methods. Performance related pay: This method reflects not only outcomes or output but also actual performance in the work (MacKenna and Beech, 2008). Increases level of basic pay based on overall personal performance, rather than as a one-off payment. Profit related pay: The employees pay and bonuses may be straight related to the companys profit or the achievement of effective targets. Principally employees would be given a motivation to work harder, and in high profit times for the company they will earn the rewards, though in bad times they would share the companys collapse. However it is possible for the employer to design a strategy in order to protect the employees when profits decreased (MacKenna and Beech, 2008). Competency based pay: Rewards can based on employees work, skills and attitude, and not only when the goal has achieved because sometimes is out of their control in several circumstances. Employee share scheme: Frequently used to link performance and long service to possession of the company. The method of offering share ownership to employees can include an individual financial value in the success of the company, as a part owner as well as an employee benefits. Non-financial approaches: This is an excellent performance and a motivation to take on more responsibility might make the employer to think a possible promotion or extra responsibility for an employee. Innocent adapts this HRM practice, and support the general idea of Payment and Reward. This practice is designed to motivate employees to work to the best of their ability and consequently is an example of method to maximising employee performance. The company organises meetings every week and the employees have the chance to talk about the topics which arise. Based in Innocent Drink company people who contribute more in the company get the highest salary and rewards. Every year the salary of each employee is reviewed and based on the annually high performance is rewarded by increasing ability to receive. Moreover the PRP Bonus  is an annually reward (Innocent website, 2012 b). If the yearly goals are successfully reached all the employees has the chance to share in the success. Furthermore all the employees have a private health care as well as life assurance and critical illness cover. Additionally there are tax saving schemes  in order to help people to save money where possible through tax saving system, for example they run the childcare coupon scheme (Innocent website, 2012 b). An once a year scholarship is offered by the company for an employee, in order to work in one of their foundation projects. Moreover the compa ny organised different clubs such as massage, cake club and Cheese Club. The best employee of the month has to wear hat or tiara and many cups of tea. Finally there are free smoothies for every employee, free breakfast and a weekly beer party every Friday (Innocent website, 2012 b). The company wants to create a friendly environment for its employees in order to increase the productivity and the will for work. 3. Employment Law-Legislation According to CIPD (2012), employment law refers to the legal rights of employees and employers. A range of employee rights are protected by employment law. Those regulations are either provided by European Union or by UK government. European Union can make suggestions for employment law and its members can vote against or can enact them. However some common employee rights such as those that encourage improvements related to health and safety must adopted by all members , including those members who vote against them (Foot and Hook ,2011). Moreover a general role which applied to all EU countries is the regulation which specifies to a maximum of 48 weekly working hours (Foot and Hook, 2011). According to the Equality Act 2010, no employee has to be discriminated about age, disability, gender reassignment, race, religion or belief, sex, sexual orientation, marriage and civil partnership, pregnancy and maternity (ACAS, 2010). This law became to practice in October 2010 (ACAS, 2010). Two examples of the Equality Act 2010: Employers have to design policies to encourage equal opportunities (Foot and Hook, 2011). They also have to train and inform the managers and the employees and ensure that no discrimination is occurring in the work environment (Foot and Hook, 2011). According to the Equality Act 2010, it is illegal for employers to discriminate because of anything of the above (ACAS, 2012). Discrimination is divided in four categories. Firstly, direct  discrimination occurs when an employer or employee treat someone less positively because of their actual or perceived sex or because of the sex of someone with whom they relate. Secondly indirect discrimination can happen where the company has a policy, training or actions that apply to all employees, but particularly disadvantage employees of a specific sex (ACAS, 2012). Thirdly, harassment occurs when unnecessary behaviour  related to sex has the reason or consequence of violating a persons dignity  or creating an unapproachable,  antagonisti c, humiliating, embarrassing or unpleasant environment. Fourthly victimisation is the unreasonable behaviour of an employee who has made or supported a criticism about sex discrimination (ACAS, 2012). As well as sex discrimination, race discrimination occurs under four categories. Race discrimination can occur because of colour, race, nationality, citizenship, ethnic or national origin are illegal (ACAS, 2012). Innocent: Innocent alight with the equality act and also it respect people from different race. For example Innocent foundation is currently supporting sixteen projects principally in countries where  innocent drinks get its fruit (Innocent website, 2012 b).   They give work to the local people with an agriculture focus in order to motivate them to use the natural sources. This move shows respect and equality between employees. Moreover Innocent provides work opportunities for both genders with equal pay, thus the company engaged with the Equality act 2010. No evidence found about discrimination or similar action from any employer at Innocent. Recommendations-Ideas for Improvement The company has to think about children nutrition (see Appendix 2), in order to decrease its high acid and sugar levels (Nexis, 2012). Innocent can organise conferences about sugar and acid levels and through the Training and Development HRM practice can develop employees knowledge about this key issue for a company which claims that is selling healthy drinks. Through this action the firm can improve its general reflection and also can show respect to the consumers. An additional recommendation can be the cooperation with a health promoting organisation or restaurant instead of McDonalds with which the company had cooperation the last five years (see Appendix 2). The cooperation with McDonalds had a bad reflection to the consumer and the firm can essentially represent its first idea which was the production of healthy drinks (Marketing Week, 2007 b). In order to succeed this cooperation the company has to encourage its personnel and motivate them through the different HRM practices such as Payment and Reward. 5. Conclusion To conclude Innocent applies the current HRM practices and current legislation effectively. According to their website and the information which are provided by the company employees are working in a friendly environment and they have many options to improve their performance through the HRM practices. Furthermore the company shows respect to the different race and gender, thus they follow the current employment law end especially the Equality Act 2010. Moreover by following the recommendations, the company can develop its functioning through employees ideas and actions as the business excellence model illustrates (Figure 1). 6. References ACAS, (2010), The Equality Act 2010, [Online]. Last accessed on 22 October 2012 at: http://www.acas.org.uk/index.aspx?articleid=3017 ACAS, (2012), Advisory handbook The A-Z of work, [Online]. Last accessed on 4 November 2012 at: http://www.acas.org.uk/index.aspx?articleid=857 BBC News Business,(2010), Richard Reed, Innocent Drinks, [Online]. Last accessed on 21 October 2012 at: http://www.bbc.co.uk/news/business-11551271 Britvic, (2012). Soft Drinks Report Data. [Online]. Last accessed on 30 October 2012 at: http://www.britvic.co.uk/reports/Soft-Drinks-Report-Data-2012.indd/index.html#/1/zoomed CIPD, (2012), [Online]. Last accessed on 17 October 2012 at: http://www.cipd.co.uk/ Fast Track 100, (2012). Last accessed on 30 October 2012 at: http://www.fasttrack.co.uk/fasttrack/leagues/dbfastDetails.asp?siteID=1compID=1378yr=2008 GMID, (2012), [Online]. Innocent Drinks Co Ltd in Soft Drinks (United Kingdom), Last accessed on 21 October 2012 at: http://www.portal.euromonitor.com.lcproxy.shu.ac.uk/Portal/Pages/Search/SearchResultsList.aspx Design Council, (2012), Innocent Drinks: creative culture and strong brand. [Online] Last accessed on 22 October 2012 at: http://www.designcouncil.org.uk/case-studies/innocent-drinks/# Innocent website, (2012 a), Full Sustainability report, [Online] Last accessed on 22 October 2012 at: http://assets.innocentdrinks.co.uk/innocentsustainability.pdf Innocent website, (2012 b), [Online], Last accessed on 22 October 2012 at: http://www.innocentdrinks.co.uk Investors in People, (2008), Evaluate training and development, [Online], Last accessed on 4 November 2012 at: http://www.investorsinpeople.co.uk/Documents/Interactive/Developing%20people/DP21.pdf Investors in People, (2012 a), How to analyse your teams development needs, [Online], Last accessed on 4 November 2012 at: http://www.investorsinpeople.co.uk/Documents/Interactive/Developing%20people/How%20to%20Analyse%20Your%20Teams%20Development%20Needs.pdf Investors in People, (2012 b), Rewarding People, [Online], Last accessed on 4 November 2012 at: http://www.investorsinpeople.co.uk/Documents/Interactive/Managing%20performance/Rewarding%20People.pdf Marchington M, Wilkinson A.,(2005),Human Resource Management, High Commitment HRM and Performance,71-98, CIPD, [Online]. Last accessed on 1 November 2012 at: http://www.cipd.co.uk/NR/rdonlyres/7FE8ADEB-EA96-4836-83DD-2E95FD309B15/0/samplech3.pdf MacKenna E., Beech N. (2008). Human Resource Management. A Concise Analysi. 2nd edition Prentice Hall Marketing Week, (2007 a). McDonalds to trial sale of Innocent smoothies. [Online], Last accessed on 31 October 2012 at: http://www.marketingweek.co.uk/mcdonalds-to-trial-sale-of-innocent-smoothies/2056106.article Marketing Week, (2007 b). Innocent guilty of sell-out? , [Online], Last accessed on 1 November 2012 at: http://web.ebscohost.com.lcproxy.shu.ac.uk/ehost/pdfviewer/pdfviewer?sid=f4ff9d99-0c5d-47f9-8745-45e97cb0c6b5%40sessionmgr112vid=8hid=128 Marketing Week, (2011).Innocent lobbies Govt to promote five-a-day. [Online], Last accessed on 30 October 2012 at: http://www.marketingweek.co.uk/innocent-lobbies-govt-to-promote-five-a-day/3024563.article Marketing Week, (2012 a). Innocent encourages kids to be gardeners, [Online], Last accessed on 30 October 2012 at: http://www.marketingweek.co.uk/news/innocent-encourages-kids-to-be-gardeners/4000213.article Mintel,(2009). Market Re-Forecasts: Food and Drink: 2009: Smoothies., [Online], Last accessed on 31 October 2012 at: http://academic.mintel.com/sinatra/oxygen_academic/search_results/show/display/id=227765/display/id=447522#atom0 Mintel, (2012), [Online]. Last accessed on 17 October 2012 at: http://academic.mintel.com Mintel, (2011), Smoothies, Executive Summary UK October 2011. [Online]. Last accessed on 17 October 2012 at: http://academic.mintel.com/display/545342/?highlight=true Nexis, (2012 a), High acid levels in juice bad for your kid s teeth!, [Online]. Last accessed on 17 October 2012 at: http://www.lexisnexis.com Nexis, (2012 b), High level of acid in fruit drinks may harm teeth enamel. [Online]. Last accessed on 17 October 2012 at: http://www.lexisnexis.com Reynolds J. (2012), McDonalds ditches Innocent Smoothies, Marketing Mgazine, [Online]. Last accessed on 1 November 2012 at: http://www.marketingmagazine.co.uk/news/1145352/McDonalds-ditches-Innocent-Smoothies/ Foot M, and Hook C,(2011), Introducing Human Resource Management, 6th Edition, FT Prentice Hall The food and grocery experts, (2009). Innocent drinks measuring their carbon footprint from farm to fridge to the recycling bin, [Online]. Last accessed on 1 November 2012 at: http://www.igd.com/index.asp?id=1fid=1sid=5tid=49folid=0cid=924 University of Cambridge publications, 2012, Developing Business Excellence Model for Performance Measurement in Transitional Economies,[Online]. Last accessed on 5 November 2012 at: http://www.ifm.eng.cam.ac.uk/research/csp/excellence/ 7. Appendices

High Fructose Corn Syrup and Cane Sugar Industries Introduction :: Agriculture Agricultural Mexico Papers

High Fructose Corn Syrup and Cane Sugar Industries Introduction In my previous paper I did my research on the history, production, and trade of cane sugar that was mostly produced in the United States. On our study abroad trip to Mexico we saw some sugar cane fields from the road, but we did get to tour any of the farms or see any sugar processing factories. So I was thinking to myself how I am going to write a paper on sugar cane in Mexico if I never experienced any of it while I was down there. Fortunately I found a topic that was very close to home and related to some of the agriculture in Mexico as well. While visiting the Trade Management Services, Inc., we met with the Iowa trade representative, Jose Antonio Jimenez. Jose mentioned some things about the controversy with the United States and Mexico with the imported high fructose corn syrup into Mexico and the effects it has had on the sugar markets and the producers. Since Iowa is the number one grower of corn in the United States, and number one in producing high fructose corn syrup, it is a major issue for Iowans because of the great market share we have with Mexico. In this essay I will discuss some of the issues with the trade barriers, taxes, and tariffs the two countries have opposed on each other. Throughout the late 1990's and the beginning of the twenty first century there has been a major controversy on United States exports of high fructose corn syrup with Mexico. The United States Trade Representative has conducted an investigation under the Trade Act of 1974, which has been amended to the certain acts, policies and practices of the Mexican government that affects the Mexican market for high fructose corn syrup. On April 2, 1998, the Corn Refiners Association Inc. filed a petition alleging that certain acts, policies, and practices of the Government of Mexico are affecting the Trade Act because they are unreasonable and deny fair and equitable market opportunities for United States exporters of high fructose corn syrup. The United States Trade representative started their investigation on May 15, 1998, in response to the petition filed by the Corn Refiners Association Inc. They believed that the Mexican government encouraged and supported an agreement between the Mexican sugar industry and the Mexican soft drink bottling industry to limit the soft drink bottling industry's purchases of high fructose corn syrup.

College or University Graduation Speech -- Graduation Speech, Commence

Members of the faculty, parents, guests, and graduates, have no fear. I am well aware that on a day of such high excitement, what you require, first and foremost, of any speaker is brevity. I shall not fail you in this respect. When we arrived at State College, all was new to us and we walked around looking up at everything in awe. As we have been preparing to leave, we were given the chance to see State College from the top of the tallest building, looking down on everything with nostalgic familiarity—inspecting the tiny people that bring State College to life, trying to imagine the countless buses we squeezed to get on, and the hours spent talking to friends. State College has meant something different to each of us, the good, the basketball. The thing about State College is that everyone is so excited to be here that the energy is palpable. There is a vibrancy and newness and sense of possibility, that carries us as students, motivates you as teachers and staff, and makes an impression on those watching us—and indeed we know there are many people watching us, looking out for the good, the bad, the basketball. We are a community diverse in thought and background: the kind of terrain that is never easy to navigate. Take it from my own experience, as I have spent my whole life learning to walk through such terrains—through countries, and communities, and schools that are divided and diverse and marked by difference—so I know how challenging and uncomfortable and sometimes exhausting that process can be—but I also know that it is remarkably rewarding, and powerful, but most of all, necessary. I know that graduation speeches are notorious for trying to impart grand messages on a sea of overwhelmed and overheated people, ... ...moment since we were born. When we left for college, they knew that we were still kids at heart. Now they look at the young men and women we’ve become and find themselves as speechless as we are. For lack of words, just turn around and blow your parents a kiss, give them a wave; it’s Mother’s Day after all, and they know the gratitude and love that these simple gestures mean today. Our families held us up when we were learning to walk, while we were learning to become adults, and amidst the uncertainties of moving on, they once again become our ground and the arms that keep us steady. The best friends we’ve made have become our family too and they will be with us through this uncertainty and others. For now, savor the goodbyes and welcome the new beginnings and remember that four years ago, we were doing the same exact thing—and everything has turned out fine.

Womens Roles in Ancient Times Essays -- Females Sociology Sociologica

Women's Roles in Ancient Times For years, people have said that since the beginning of civilization our society has been patriarchal. This assumption is wrong. Archeological evidence proves that in the beginnings, the cultures were female-centered, with a creator goddess. Women's roles were valued as more important than men's role specially because they could give birth. Although this is true, no evidence suggests that these cultures had a matriarchal society. In fact, the evidence found supports the idea of a society where men and women worked side by side sharing the labor, with different roles or tasks, but all equally important. This idea declined over time until we got to the point where women were treated as slaves, and societies were completely male-centered. To prove that women did actually have a very important role in the beginnings of times, we will look at evidence from three archeological sites: Paleolithic Europe, the Neolithic "Old Europe" and the Neolithic Catal Huyuk. First, Paleolithic period in Europe which contains information for the oldest civilization we know up too now, covers the years 40,000 to 10,000 BCE. In this period, people saw the universe as an all giving mother, a very powerful force that gave life. The birth giving process, was looked upon as miraculous in this times, therefore women were venerated for them posses that ability. Evidence to support this theory, can be found in the paintings on the caves discovered in this site. Fist, in these paintings female figures or feminine symbols where always placed in the center, surrounded by the masculine symbols. Also whenever animals' drawings were found in those painting, they were often drawn with big bellies implying pregnancy. E... ...a society where women took on not only an important role, but perhaps the most important role that of the creator of life. However, as society developed and cultures were born the world changed, and we came upon what we have today. A world, where women not only do not have the important role it had before, but had to fight to get the minimal human rights that any human is entitled to. After generations, today we are able to support the importance of the role of women in the creation of many of the principal societies have been built upon such as agriculture and art. In spite of the many changes through the generations, there is one irrefutable fact that will always ensure the place of women in history, we will always be the giver-of-life. Even if that role has been cast down from that of a Goddess to that of an everyday woman, the miracle of it still remains intact.

Dijkstra Paper

(A Look Back at) Go To Statement Considered Harmful Edsger Dijkstra wrote a Letter to the Editor of Communications in 1968, criticizing the excessive use of the go to statement in programming languages. Instead, he encouraged his fellow computer scientists to consider structured programming. The letter, originally entitled â€Å"A Case Against the Goto Statement,† was published in the March 1968 issue under the headline â€Å"Go To Statement Considered Harmful. † It would become the most legendary CACM â€Å"Letter† of all time; â€Å"Considered Harmful† would develop into an iconic catch-all.Dijkstra’s comments sparked an editorial debate that spanned these pages for over 20 years. In honor of the occasion, we republish here the original letter that started it all. Editor: For a number of years I have been familiar with the observation that the quality of programmers is a decreasing function of the density of go to statements in the programs they p roduce. More recently I discovered why the use of the go to statement has such disastrous effects, and I became convinced that the go to statement should be abolished from all â€Å"higher level† programming languages (i. e. verything except, perhaps, plain machine code). At that time I did not attach too much importance to this discovery; I now submit my considerations for publication because in very recent discussions in which the subject turned up, I have been urged to do so. My first remark is that, although the programmer’s activity ends when he has constructed a correct program, the process taking place under control of his program is the true subject matter of his activity, for it is this process that has to accomplish the desired effect; it is this process that in its dynamic behavior has to satisfy the desired specifications.Yet, once the program has been made, the â€Å"making† of the corresponding process is delegated to the machine. My second remark is that our intellectual powers are rather geared to master static relations and that our powers to visualize processes evolving in time are relatively poorly developed. For that reason we should do (as wise programmers aware of our limitations) our utmost to shorten the conceptual gap between the static program and the dynamic process, to make the correspondence between the program (spread out in text space) and the process (spread out in time) as trivial as possible.Let us now consider how we can characterize the progress of a process. (You may think about this question in a very concrete manner: suppose that a process, considered as a time succession of actions, is stopped after an arbitrary action, what data do we have to fix in order that we can redo the process until the very same point? ) If the program text is a pure concatenation of, say, assignment statements (for the purpose of this discussion regarded as the descriptions of single actions) it is sufficient to point in th e program text to a point between two successive action descriptions. In the absence of go to statements I can permit myself the syntactic ambiguity in the last three words of the previous sentence: if we parse them as â€Å"successive (action descriptions) â€Å"we mean successive in text space; if we parse as â€Å"(successive action) descriptions† we mean successive in time. ) Let us 7 PAUL WATSON COMMUNICATIONS OF THE ACM January 2008/Vol. 51, No. 1 Forum call such a pointer to a suitable place in the text a â€Å"textual index. † When we include conditional clauses (if B then A), alternative clauses (if B then A1 else A2), choice clauses as introduced by C.A. R. Hoare (case[i] of (A1, A2, †¦ , An)), or conditional expressions as introduced by J. McCarthy (B1__ >E1, B2 __ E2, †¦ , Bn __ > > En), the fact remains that the progress of the process remains characterized by a single textual index. As soon as we include in our language procedures we must admi t that a single textual index is no longer sufficient. In the case that a textual index points to the interior of a procedure body the dynamic progress is only characterized when we also give to which call of the procedure we refer.With the inclusion of procedures we can characterize the progress of the process via a sequence of textual indices, the length of this sequence being equal to the dynamic depth of procedure calling. Let us now consider repetition clauses (like, while B repeat A or repeat A until B). Logically speaking, such clauses are now superfluous, because we can express repetition with the aid of recursive procedures. For reasons of realism I don’t wish to exclude them: on the one hand, repetition clauses can be implemented quite comfortably with present day finite equipment; on the other hand, the reasoning pattern known as â€Å"induction† makes us well quipped to retain our intellectual grasp on the processes generated by repetition clauses. With the inclusion of the repetition clauses 8 textual indices are no longer sufficient to describe the dynamic progress of the process. With each entry into a repetition clause, however, we can associate a socalled â€Å"dynamic index,† inexorably counting the ordinal number of the corresponding current repetition. As repetition clauses (just as procedure calls) may be applied nestedly, we find that now the progress of the process can always be uniquely characterized by a (mixed) sequence of textual and/or dynamic indices.The main point is that the values of these indices are outside programmer’s control; they are generated (either by the write-up of his program or by the dynamic evolution of the process) whether he wishes or not. They provide independent coordinates in which to describe the progress of the process. Why do we need such independent coordinates? The reason is—and this seems to be inherent to sequential processes—that we can interpret the value of a variable only with respect to the progress of the process.If we wish to count the number, n say, of people in an initially empty room, we can achieve this by increasing n by one whenever we see someone entering the room. In the inbetween moment that we have observed someone entering the room but have not yet performed the subsequent increase of n, its value equals the number of people in the room minus one! The unbridled use of the go to statement has an immediate consequence that it becomes terribly hard to find a meaningful set of coordinates in which to describe he process progress. Usually, people take into account as well the values of some well chosen variables, but this is out of the question because it is relative to the progress that the meaning of these values is to be understood! With the go to statement one can, of course, still describe the progress uniquely by a counter counting the number of actions performed since program start (viz. a kind of normalized clock). Th e difficulty is that such a coordinate, although unique, is utterly unhelpful.In such a coordinate system it becomes an extremely complicated affair to define all those points of progress where, say, n equals the number of persons in the room minus one! The go to statement as it stands is just too primitive; it is too much an invitation to make a mess of one’s program. One can regard and appreciate the clauses considered as bridling its use. I do not claim that the clauses mentioned are exhaustive in the sense that they will satisfy all needs, but whatever clauses are suggested (e. g. bortion clauses) they should satisfy the requirement that a programmer independent coordinate system can be maintained to describe the process in a helpful and manageable way. It is hard to end this with a fair acknowledgment. Am I to judge by whom my thinking has been influenced? It is fairly obvious that I am not uninfluenced by Peter Landin and Christopher Strachey. Finally I should like to r ecord (as I remember it quite distinctly) how Heinz Zemanek at the pre-ALGOL meeting in early 1959 in Copenhagen quite explic- January 2008/Vol. 1, No. 1 COMMUNICATIONS OF THE ACM itly expressed his doubts whether the go to statement should be treated on equal syntactic footing with the assignment statement. To a modest extent I blame myself for not having then drawn the consequences of his remark. The remark about the undesirability of the go to statement is far from new. I remember having read the explicit recommendation to restrict the use of the go to statement to alarm exits, but I have not been able to trace it; presumably, it has been made by C. A. R. Hoare. In [1, Sec. 3. . 1. ] Wirth and Hoare together make a remark in the same direction in motivating the case construction: â€Å"Like the conditional, it mirrors the dynamic structure of a program more clearly than go to statements and switches, and it eliminates the need for introducing a large number of labels in the prog ram. † In [2] Guiseppe Jacopini seems to have proved the (logical) superfluousness of the go to statement. The exercise to translate an arbitrary flow diagram more or less mechanically into a jumpless one, however, is not to be recommended.Then the resulting flow diagram cannot be expected to be more transparent than the original one. REFERENCES 1. Wirth, Niklaus, and Hoare, C. A. R. A contribution to the development of ALGOL. Comm. ACM 9 (June 1966), 413–432. 2. Bohn, Corrado, and Jacopini, Guiseppe. Flow Diagrams, Turing machines and languages with only two formation rules. Comm. ACM 9 (May 1966) 366–371. Coming Next Month in COMMUNICATIONS Alternate Reality Gaming IT Diffusion in Developing Countries Are People Biased in their Use of Search Engines?The Factors that Affect Knowledge-Sharing Behavior Alternative Scenarios to the â€Å"Banner† Years Municipal Broadband Wireless Networks The Myths and Truths about Wireless Security Managing Large Collection s of Data Mining Models Women and Men in IT: Alike or Different? EDSGER W. DIJKSTRA Technological University Eindhoven, The Netherlands Communications of the ACM March 1968, Vol. 11, No. 3, pg 147 COMMUNICATIONS OF THE ACM January 2008/Vol. 51, No. 1 9

The Lion, the Witch and the Wardrobe

C. S Lewis wrote the novel The Lion, the Witch and the Wardrobe initially for his Goddaughter in order to keep her in touch with Christianity. What Lewis did not realize is that many adults would also enjoy the fantasy children’s novel as well. The narrative is filled with mythical creatures, humorous moments, and suspenseful situations. Although many events and characters seem improbable, the four children in the book—Peter, Susan, Edmund, and Lucy—are realistically portrayed as well-rounded characters with individual strengths and faults. Although the novel is recognized as a children’s fantasy book, it is also popular with adults as the story contains bits of modern culture, vivid descriptions of violence and is heavy on Christian allegory. As much as the readers enjoy the magical land of Narnia, 21st century life is not exactly full of Dryads, Naiads and Fauns frolicking and feasting in the summer woods. By contrast, in today’s children’s fantasy novels, not every injustice is punished, and not all the good people live happily ever after: some of them die, because that is reality. Between school shootings, gang violence and child abuse is seems as though reality is thousands of miles away from the fantasy of complete and total justice in Narnia. What readers of all ages can relate to, however, is betrayal. For example, spouses who cheat, employees who steal from their employers, and friends who tell lies. This modern idea of betrayal is where readers from any age can relate to the novel. In the narrative, Edmund’s first betrayal is a small but unpleasant one: â€Å"Up to that moment Edmund had been feeling sick, and sulky, and annoyed with Lucy for being right, but he hadn't made up his mind what to do. When Peter suddenly asked him the question he decided all at once to do the meanest and most spiteful thing he could think of. He decided to let Lucy down† (Lewis 48). Edmund lies about his trip to Narnia in order to make himself look superior in the eyes of his older siblings. This small cruelty will pave the way for his greater betrayal further in the story. Readers of any age can connect with the modern culture of betrayal in the novel, where minimal details are explored that over time lead to Edmund turning his back on his siblings. This novel features an odd mix of childish adventure and bloody battles. Young children who read this story enjoy the fairy-tale aspects, while older readers can appreciate the repetition of scenes in which the children are often comforted by the sudden availability of tea, and the way the forces of good seem to always outweigh the evil. The use of violence throughout the novel deals strictly with fantasy for children, where it is mainly used for excitement. On the other hand, for older readers the violence in the novel can be seen as consequential where extreme force is used as simply last resort. For example, as the head of the forces of evil, the White Witch is not playing a long hand when she exclaims, â€Å"Summon all our people to meet me here as speedily as they can. Call out the giants and the werewolves and the spirits of those trees who are on our side. Call the Ghouls, and the Boggles, the Ogres and the Minotaurs. Call the Cruels, the Hags, the Spectres, and the people of the Toadstools. We will fight† (Lewis 149) There are many different creatures in Narnia that follow the White Witch and she merely acts as their stone cold captain. This quote explores evil where it is not an isolated incident in Narnia – it is the idea of violence and commands a great deal of power. The Lion, the Witch and the Wardrobe functions as a spiritual allegory where one does not have to be too familiar with the Bible to recognize some of the key characters and themes. Without doubt, Aslan represents Jesus Christ, and also God himself, whereas the White Witch represents Satan. Narnia, where the adventure happens, visibly represents the Kingdom of God. Clearly there is no direct retelling of any of the Bible stories; however, readers can find elements taken and redistributed for younger readers. In addition, having this biblical reality come to life is important to ensure a committed Christian lifestyle not only for children, but also for adults. For instance, when Edmund arrives in Narnia alone, he immediately meets the White Witch where he is tempted with the enchanted Turkish Delight and the promise of becoming a prince of Narnia. The White Witch explains to Edmund, â€Å"I think I would like to make you the Prince – some day, when you bring the others to visit me† (Lewis 40). Succumbing to temptation is a very powerful theme in the Bible, where Jesus is tempted by Satan in the wilderness with promises of great power. Not only does Lewis restate certain events in the life of Jesus in a context that is easy to understand, most importantly, readers of all ages can both relate to and enjoy the fantasy of Narnia. An understanding of the modern reality, use of violence and Biblical allegory in the novel is essential in satisfying both younger and older readers. The Lion, the Witch and the Wardrobe has already established itself as a timeless novel that appeals to both the atheists and Christians, the uneducated and to scholars, and lastly to children and adults. In addition to being a children’s fantasy book, it is an adventure story in which the heroes set out on a quest to recover their kidnapped friend and end up ruling the land. An analysis of this narrative, however, allows readers of any age to fully appreciate Lewis’ unique gift to simplify complex ideas and craft beautiful children’s fantasies. Thus, this allows the reader of any age group to gain a deeper understanding of Lewis as a skilled creative writer and a deeper satisfaction of his artwork, The Lion, the Witch and the Wardrobe.