Financial Crisis Impacts on Progress of Employees Essay

Financial Crisis Impacts on Progress of Employees - Essay Example There have been a lot of studies conducted by various scholars since the great depression in 1930’s up to today. Literature obtained from this series of academic studies conducted by the various scholars is still relevant up to today in offering explanations on how and what were the main contributors of the various crisis. This literature has been relied upon by many academicians as well as policy makers in order to make sure that such events do occur again. Theoretical Literature There are two theories, which seem, to be more developed and various scholars have borrowed much from them. These theories are the Minsky’s crisis theory and Marxist crisis theory. Minsky’s crisis theory is named after the Hyman Minky a renowned economic professor who developed this theory. Hyman initial objective was to elucidate the domestic economy crisis. This has since changed as this theory is adopted by various expert and scholars in delineating global financial crisis. The under lying concept in his theory was the fragility observed in the financial system. He elucidates the behavior of both the financial sector and non-financial sector to engage in liabilities with a high level of risk as businesses enlarge was the major contributor to the crisis. From an international front, he argues that the interdependency of economies fundamentally leads to instability of the global financial system. He attributes the instability experienced in the global financial system to lending activities that lend debt accumulation (Davies 2010). The main theme of theories was the concern expanding economy and the emergence of â€Å"a speculative investment bubble†. Hyman argued that as the economy expanded, that is, as the economy experienced tremendous growth, thus resulting to low level of unemployment as the level of investment in the economy increases. Optimism increases and trade between debt and risk changes. As a result of the increases in optimism, there is an in crease in the level of asset prices as well as increase, in speculation. The increase in asset prices in return allowed ponzi borrowers to thrive in an economy (Davies 2010). This also leads changes the attitudes that investors have toward risk thus resulting in, changes in liability portfolio. As a result of changes in risk and liability structure, the financial structure becomes fragile thus resulting into a financial crisis (Davies 2010). In doing this Hyman linked, the fragility experienced in a normal economy to the speculative investment bubble which emerges in the financial market. Minky argued that, when the corporate sector and the economy as a whole are experiencing growth, that is when the cash inflows exceeds the amount need to phase off debts there is a tendency to develop speculation (Davies 2010). When the grows up to appoint where the present assets cannot support the economy when borrowers cannot repay their loans since the cash-inflows are not enough to finance con sumption and to honor debts, this degenerate into a financial crisis. When this occurs, the lenders adopt stringent credit issuance policy; such that even companies with the capability of obtaining loans are not spared; thus, this leads to the contraction of the economy. The movement of a

EU COMPETITION LAW Essay Example | Topics and Well Written Essays - 2500 words

EU COMPETITION LAW - Essay Example For a better understanding, the paper will first approach the legal interpretation of concurrence of wills as provide for in Article 81 of EC. Introduction: Understanding Concurrence of Wills as Per Article 81 of EC The EU competition law does not any distinctions otherwise referred to as formalistic between any two varied forms of collaboration within the provisions of Article 81 of the EC law. One may find reference to this in the case involving Volkswagen v Commission1. The concept of agreement, within the interpretation of this article, on the existence of the concurrence of wills, explores different possibilities of trade and sales relations between two or more parties. The article provides that form in which the concurrence of wills manifests itself remains vital provided it is in utmost good faith by parties involved (Office of Fair Trading, 2010, p. 12). In other words, the article also implies that courts shall construe agreements to mean concurrence of wills. One may also i nterpret the article to understand agreements as to mean existence of a common intention between two or more parties. ... Convergence of interest to promote commerce within the provisions of accepted form of competitions such a mergers and collusions. The EU Article 81 interprets collusion in terms of jurisdiction functions rather than in substantive function. The problem is that collusion, under Article 81, does not hold given that it is never jurisdiction in many cases but substantive. Provisions of Article 101(1) TFEU The Treaty on the Functioning of the European Union, Art 101(1) TFEU, takes any agreements between undertakings, decisions by association of undertakings and concerted practices to mean agreements. For better understanding, the article also takes such agreements to mean Horizontal Corporation. In addition to that, clarification, the article also defines Horizontal Corporation to mean any agreement into which actual competitors or potential competitors enter. The article also covers two companies that deal in the same line of the product, though, in different geographical conditions (Off ice of Fair Trading, 2010, p. 21). For the purposes of Art 101(1) TFEU, one expects the article to assess an agreement between undertakings. This is because an agreement is capable of affecting trade between member states. The article assess whether an agreement has elements of an anti-competitive object on competition. It also assesses whether an agreement an actual or potential restrictive effect on competition. In case a court determines an agreement as restrictive of competition within the provisions and interpretation of Article 101 (1), then Article 101 (3) comes into force. The function of article 101(3) is to assess the extent to which the agreement may provide for pro-competitive advantage over the restrictive nature so determined under Article