Should Constitutions be Written?

Should Constitutions be Written? Constitutions should be written. Discuss. Choose one country with a case law system and one with a civil law system and discuss the advantages of each. ANSWER 1. Introduction A constitution can be defined as a system or framework which enshrines the principles and rules by which a body is governed. In the context of states the term makes reference specifically to the national constitution of the state, which serves to define the fundamental political principles, the legal environment and modus operandi of the state and which establishes the duties and powers of the government of the state.[1] National constitutions can be classified as either codified or uncodified. Codified constitutions are those which are contained in a single document, containing the single source of the constitutional law of a state, and perhaps the most well known example is the Constitution of the United States.[2] Uncodified constitutions are those which are not contained in a single document, but consist instead of several different sources, which can be written or unwritten.. It should be noted that there are hybrid systems which seem to fall between the two classes such as the Australian Constitution[3], in which constitutional law largely derives from a single written document, but other written documents are also considered part of the constitution[4]. Probably the best example of a pure uncodified constitution is the constitution of the United Kingdom which does not rely on any single written fundamental document, but rather consists of a patchwork of written and unwritten sources. The term written constitution makes reference to a constitution which is entirely written and by definition this would include every codified constitution. Indeed, in academic writing the term written constitution is synonymous with codified constitution, and in similar fashion the term unwritten constitution is interchangeable with uncodified constitution (although as stated this is not always entirely accurate: see Australian constitution). In the modern world, codification is the norm. Most states have evolved written constitutions which stand as the supreme and overarching statements of national law. Unwritten constitutions are certainly in the minority, but it is submitted at the outset that this should not be taken as proof that a written constitution is a prerequisite to success or stability. 2. A Common Law System: England The United Kingdom is notable in that it operates under an unwritten constitution, although this term has been criticised by commentators such as Bogdanor as a â€Å"misleading platitude†[5]. In this paper we will confine ourselves to an examination of the legal system of England and Wales, within the United Kingdom, because the Scottish legal system derives from Roman Law a very different legal heritage and tradition.[6] The modern English system of law can be traced back to the Norman conquest of 1066. The Norman kings, while promising to respect local rights and customs, dispatched judges to travel around the country on circuits and these judges gradually began following each other’s decisions to preserve the consistency of the application of law in different parts of the country. This practice became formalised and is today known as the doctrine of judicial precedent. This doctrine was extremely successful in underpinning the English common law system (ie a law common to all parts of the kingdom). One advantage of this uncodified model is that it is free to grow and develop organically to suit the changing environment it must regulate something which is more difficult when one is bound by a rigid set of general principles such as that which would underpin a fully written system. As the Parliament at Westminster fully established itself and grew in power and authority over the Monarch it took its place alongside the common law. Together, the common law and Parliamentary legislation came to offer a coherent and comprehensive system of law, which has matured and refined itself over centuries of stable government. It can be argued that an unwritten system puts its faith in untrammelled democratic process and in those charged with its maintenance. There are, it is submitted, obvious risks attached to this strategy, but in simple terms England has never found the need to adopt an overlaying written constitution, because of the strength and scope of its existing system. However, this is not to say that the English ‘constitution’ is entirely unwritten. Aspects of constitutional-style law are evident in venerable statutes such as the 1215 Magna Carta,[7] the 1689 Bill of Rights[8], the 1701 Act of Settlement[9] and the 1911 and 1949 Parliament Acts.[10] More recently the United Kingdom has adopted quasi-constitutional law in piecemeal fashion by means of the European Communities Act 1972, which provides the legal framework necessary for the country’s membership of the European Union, and the Human Rights Act 1998, which imports the rights and freedoms enshrined in the European Convention of Human Rights into UK law, conferring those rights on citizens of the United Kingdom. This means that the English system achieves an effect equivalent to that which is delivered by a written constitution without the formality of the latter model and therefore some of the advantages of written systems are to some extent rendered nugatory. That sai d, the principle that stands at the very heart of the English legal system and overrides all other provisions and considerations cannot be found set out in any of these documents. The highest rule of UK law, which has the potential to override any principle of a constitutional or quasi-constitutional nature, is the Doctrine of Parliamentary Sovereignty. This unwritten rule declares that the Parliament of the United Kingdom enjoys full and unchallengeable sovereignty in all its actions. In practice, this means that the Parliament of the day (namely the House of Lords the House of Commons, and the Monarch acting together)[11] has supreme authority over all aspects of English governance and all other institutions of the state, including the courts and other executive bodies. This ensures that the situation in England differs with that which prevails in many states operating under codified or written constitutions, where supreme courts are often empowered to strike down legislation deemed to be unconstitutional in nature.[12] The Constitution of the United States’ is one example of such a system and the so-called â€Å"checks and balances† it employs to safeguard the integrity of the constitution and the governance of the state are much cherished.. In the English system, given that Parliamentary supremacy is unquestioned, although complex procedures for judicial review are in place, by which courts can review and challenge laws considered defective in some way, the final word is left to Parliament itself. In the Introduction to the Study of the Law of the Constitution (1885)[13] Dicey : â€Å"Parliament has the right to make or unmake any law whatever; and further, that no person or body is recognised by the law of England as having a right to override or set aside the legislation of Parliament.† This is the most important law of the English legal system and it is this rule above all which explains the country’s lack of a written constitution. As a direct consequence of the application of this principle the UK Parliament has the power to make, amend and revoke law on any issue at any time. No Parliament has the power to bind a successor Parliament to its will, meaning that no Parliament could enact a so-called constitutional law which could not later be repealed or amended by some future Parliament as easily as any other piece of legislation. Moreover, the only body with the ultimate power to vary a law brought into force by the UK Parliament is Parliament itself. This gives the English system considerable flexibility and adaptability, and this is clearly and advantage. However, given that the system relies exclusively on the integrity of Parliament, its success is predicated on a fluctuating democratic mechanism. To date, the United Kingdom has enjoyed good and stable government and its citizens have not expressed any cogent desire for the protection of a written constitution.. However, that is not to say that at some point in the future the â€Å"checks and balances† and clarity typically provided by a written constitution might prove useful. 3. A Civil Law System: France The French legal system is a good example of a civil law system operating under a written constitution. The current Constitution of France, which is known as the Constitution of the Fifth Republic, was adopted in 1958.[14] It has been amended on various occasions, most recently in 2003. The French model is particularly interesting as it was used as a template for the foundation treaties of the European Economic Community, which has now evolved to become the European Union, which itself is now seeking to establish its own written constitution.[15] National legal systems characterised as Civilian are those which see their origins in the model of governance adopted in ancient Rome by the Emperor Justinian (sometimes known as Roman law systems). Civil law systems are systematic (based on an organised code of conceived principle) and inductive (where a specific ruling is induced from a general first-principle) as opposed to Common law systems which are empirical (based on a bank of actual cases) and deductive (where a general principle is deduced from a specific instance or series of instances). As to which system is to be preferred, both give rise to a variety of advantages and disadvantages and both have the potential to provide a state with a fair and effective system of government. Codified or written systems are always of the Civil school, given that a code of law is a prerequisite of that legal tradition, and consequently common law or case law systems are far better suited to an uncodified or unwritten constitutional arrangement. In very general terms the advantages of written systems of law such as the French system are those of certainty, consistency, clarity and stability, while its main disadvantage is rigidity. Unwritten case law systems benefit from being more fluid and adaptable and assuming this flexibility is not abused an uncodified model can be extremely successful. The main disadvantages of case law systems are that it is more difficult to predict the law’s response to new situations, and that the fundamental guiding principles of the legal system are harder to identify. The preamble of the French constitution refers to the 1789 Declaration of the Rights of Man and of the Citizen. As such it establishes the identity of the French state as a democratic secular republic which derives its sovereignty from the people of France. This gives the French constitution a clear mandate and provides it with a strong foundation, something which is lacking in unwritten, uncodified systems such as the English. This may be construed as an advantage, given law is an amorphous concept which can benefit from grounding in any context, but unless the authority of law is subject to challenge the advantage is theoretical only and the people of England appear satisfied to adhere to the law without such conceptual underpinning.. A written constitution such as the French offers a â€Å"one-stop shop† for provisions relating to the election of the President of France and the French Parliament.. It also sets down mechanisms for the appointment and selection of the Government of France, and specifically details the powers of each of these bodies and the relations between them. The French constitution also guaranteed the autonomy and authority of the judiciary and establishes the Constitutional Council, the High Court of Justice, and an Economic and Social Council. This is a clearly useful, and probably stands as an advantage over the English system, where such matters are dealt with in piecemeal fashion and without the simplicity and some might say methodological strength of an written system. When dispute arises in the French system there is therefore one and one only sovereign authority to turn to for guidance and this may prove beneficial in its resolution. In rebuttal, those defending the unwritten En glish system can point to many states which operate under a written constitution which suffer considerably more administrative difficulties and enjoy significantly less stability than it does. The maxim â€Å"if it isn’t broke, don’t fix it† appears to suit the English experience and explains the reluctance or at least ambivalence of English government and people in this context. The French constitution also provides for a politically strong President and this could be seen as another advantage, although again it is hard to argue that the British Prime Minister is prejudiced by the fact that his role is not similarly enshrined.. The French constitution also permits the ratification of international treaties such as those necessary for membership of the United Nations and European Union.. However, this is not necessarily an advantage. It is submitted that in modern times the trend has been towards greater and deeper international association. It could be argued that national written constitutions have the potential to frustrate international integration given that the international association may also wish to establish a sovereign constitution and that there will inevitably be conflict between the two sets of laws. There are tensions, for example, between the French constitution and the constitution which has been proposed for the European Union, and even with existing provisions of EU law. It can thus be contended that the English unwritten system is more adaptable to assimilation with an international body incorporating its own constitutional framework. Moreover written constitutions can be bypassed something done by French President Charles de Gaulle in highly controversial circumstances in 1962,[16] and this can leave a new law in a state of limbo. 4. Concluding Comments In summary, it is submitted that perhaps the most obvious advantage of a codified or written constitution is that it provides coherent, comprehensive and certain body of rules.. Being contained in a single document a codified constitution is accessible to all and can, if well crafted, establish an equitable and effective system of governance and rights. Written constitutions also promote consistency and concrete points of reference for law which can be applied to shape a legal system’s response to changing conditions within a state. That said however, written constitutions which become entrenched may suffer from rigidity and it is flexibility that perhaps stands as the greatest advantage of the unwritten, uncodified system operated in the United Kingdom. It is true that constitutional courts may offer a wide range of interpretations of constitutional principles under a written system, but it is not possible to lend a codified system that flexibility and adaptability enjoyed by an unwritten one. The title to this work asserts that â€Å"constitutions should be written†. It has been shown that this is not necessarily the case, given that states can function successfully and for long periods of time without the foundations of a codified or written constitutional framework. A good example is that of the United Kingdom itself, which is one of the most stable and successful democracies in the world, and which has grown to become such without being underpinned by a written constitutional document. While it has been suggested that the United Kingdom adopts a written constitution there appears to be no urgent pressure or compelling need to make the change. Therefore, while it is acknowledged that most states around the world have adopted a codified constitution this commentator contends that the statement under review should be subject to the caveat that states do not require to make reference to such a system of law as a prerequisite to effective government or a robust and e quitable society. The fact that a constitution is unwritten does not necessarily undermine the integrity of a national legal system, as the relative success of the United Kingdom and such countries as New Zealand and Israel testifies. There are, has been noted, risks attached to an unwritten system which puts its faith exclusively in the democratic process. However, in closing it is worth noting that there are also risks attached to written systems bound to overarching constitutions, because those constitutions can be abused or manipulated in a way that can deliver excessive power and authority. A constitution is, after all, only as good as the words that comprise it. Ironically, the elliptical doctrinal patchwork of an unwritten system can frustrate the intentions of nascent dictatorial ambition. In conclusion it is undeniably true that the great majority of states have chosen the certainty and clarity of a written system, but that is by no means the only way to run a country well. THE END WORD COUNT : 2808 (excluding footnotes) BIBLIOGRAPHY A. Bradley and K. Ewing, Constitutional and Administrative Law, (2003) Longman Wikipedia (various sources): http://en.wikipedia.org/wiki/Constitution_of_the_United_States JF McEldowney, Public Law, (2002) Sweet Maxwell P. Spink and N. Busby et al, Scots Law, (2003) LexisNexis Albert Dicey, Introduction to the Study of the Law of the Constitution (1885): http://www..constitution.org/cmt/avd/law_con.htm. 1 Footnotes [1] For an insightful overview see: A. Bradley and K. Ewing, Constitutional and Administrative Law, 13th ed., (2003) Longman, chapter 1. [2] See: http://en.wikipedia..org/wiki/Constitution_of_the_United_States. [3] See: http://en.wikipedia..org/wiki/Constitution_of_Australia. [4] In the Constitution of Australia, most fundamental political principles and regulations regarding the relationship between branches of government, and regarding the government and the individual are codified in a single document, the Constitution of the Commonwealth of Australia. However, the existence of statutes with constitutional significance, namely the Statute of Westminster, as adopted by the Commonwealth in the Statute of Westminster Adoption Act 1942, and the Australia Act 1986 means that Australias constitution is not incorporated in a single constitutional document. [5] See: http://news.bbc.co.uk/1/hi/uk_politics/talking_politics/88136.stm. [6] See P. Spink and N. Busby et al, Scots Law, (2003) LexisNexis, chapter 1. [7] See: http://www.bl.uk/treasures/magnacarta/translation.html [8] See: http://en.wikipedia.org/wiki/English_Bill_of_Rights. [9] See: http://en.wikipedia.org/wiki/Act_of_Settlement. [10] See: http://en.wikipedia..org/wiki/Parliament_Acts. [11] Although the participation of the Crown is essentially ceremonial and formal only. [12] See: http://www.archives.gov/national-archives-experience/charters/constitution..html. [13] Albert Dicey, Introduction to the Study of the Law of the Constitution (1885): http://www.constitution.org/cmt/avd/law_con.htm. [14] Which replaced that of the Fourth Republic dating from October 27, 1946. [15] Ironically this plan has been frustrated by a negative referendum vote in France itself. [16] See: http://en.wikipedia.org/wiki/Constitution_of_France.

Suicide In Jails :: essays research papers

Suicide In Jails The United States is plagued by a countless number of social dilemmas. Although not in constant public scrutiny, suicide is a serious problem which has seemed to have lost importance. When suicide is coupled with arrest and incarceration it becomes an increasingly complex situation. In fact, research indicates that the jail suicide rate ranges from 2.5 to 13 times greater than the rate of the general population (Winkler 1992). Motivation, prediction, and prevention of suicidal behavior are grossly unclear, which only adds to the already existing complexity. Many factors involved with arrest and incarceration only serve as a catalyst of suicidal tendencies. Suicide is the primary cause of death in this country's jails. In 1986 there were 401 successful [jail] suicides (Winkler 19992). There are many general assumptions made in regard to suicide. Most believe suicide to be caused by mental illness such as major depression or bipolar disorder. Another belief is that the emotional escalation leading to action takes place over a long period of time. Such is not the case in jail suicides. Much of the research shows that "of all [jail] suicides occur within the first twenty four hours of incarceration, and an overwhelming number of these take place in the first three hours of isolation which is referred to as the â€Å"crisis period" (Hess 1987). The crisis period is reflective of arrest and incarceration as producing extreme confusion, fear, and anxiety. The crisis period is also the result of isolation. Isolation causes an individual to lose all social support systems. Placing an individual in isolation may be a form of protection, but this gives the individual an opportunity to concentrate on feelings of hopelessness (Winkler 1992). Hopelessness can be defined as the presence of despair and negative feelings about the future (Shneidman 1987).Isolation can also produce a severe threat to those inmates who have difficulty with coping abilities as this only encourages future deterioration. Undoubtedly, isolation is often necessary to contain a person, or to prevent injury to the individual and, or other inmates. Individuals who are experiencing obvious mental stress should certainly not be held in isolation for obvious reasons. According to Hess (1983),many facilities have regulations which state,â€Å"The action taken must be responsible under the circumstances and represent a good- faith judgment that the action was the least restrictive alternative available.† Regulations such as this not only serve as a guideline for officers, but as a preventive measure against legal action as a result of isolation. Aside from these emotional factors of the physical environment which are impetus of suicidal attempts. Isolation cells more often than not tend to have poor

How Each Piece of Legislation Will Influence Working Practices in the Setting? Essay

The Children Act 1989 has influenced setting by bringing together several sets of guidance and provided the foundation for many of the standards practitioners adhere to and maintain when working with children. The Act requires that settings work together in the best interests of the child and that they form partnerships with parents and carers. It requires settings to have an appropriate adult: child ratios and policies and procedures on child protection. This Act has an influence in all areas of practice within setting. For example; planning. 2. ) Disability Discrimination Act 1995 (DDA 1995)- The DDA states: â€Å"settings are required to make reasonable adjustments by either changing policy, providing alternative ways to access a provision, or by addressing physical features which make a service impossible or unreasonably difficult for disabled people to use. † (www. hse. gov. uk/disability/law. htm) This means that settings must make their provision more accessible. For example; by having downstairs toilets, wider doors and ramps to the front doors. . ) Children Act 2004 – This Act was introduced as a result of the death of Victoria Climbie and was the introduction of ‘Every Child Matters’ which ensures the wellbeing of children through its five outcomes. The Every Child Matters framework has influenced settings by giving them and other childcare settings a duty to find new ways of working together by sharing information and working co-operatively to protect children from harm. 4. ) Human Rights Act 2000 – This Act has had a huge impact in current legislation in the UK. Under the Act it was agreed that children would have the same rights as adults which means children have the right to dignity, respect and fairness in the way that they are treated. In terms of working with children the articles that relates to this Act are Article 8 which is about the right to privacy, Article 10 the right to freedom of expression and Article 14 discrimination. This legislation has also affected the main principles which underpin working with children. 5. ) Race Relations Act 1976 – The Race Relations Act 1976 aims to express ethnic discrimination. In 2000 there was an amendment to the Race Relations Act which reinforced some of the necessities of the earlier legislation and make settings work towards racial equality. In practice this means that a setting must be alert on how they promote their service, recruit staff and make the provision accessible to all. Following the Act, â€Å"the Commission for Racial Equality was established in order to help enforce the act, and also to advise the Government and others on issues concerning it.

My Personal Narrative Of My Life - 1286 Words

My personal Narrative The date was October 8, 2014, 2 days after my birthday. One of the realest quotes I heard was â€Å"Don’t trust a soul† and i should have listened. It started out as any other day, mom was mad me for one reason or another, dad was sitting on the couch like always playing the â€Å"Call of Duty†. I was a Saturday so of course I tried to sleep in but my dad love playing his game with the sound on high it really out under my skin. Think about it you re sleeping in your bed and all of a sudden you hear â€Å"POW! POW! POW!† you’re going to get pretty irritated but i was use to it. Anyways my dad had no job and if you saw him he was either over his friends house, sleep, arguing with my mom or smoking stuff I shouldn t say right now. My†¦show more content†¦I didn t find it weird or strange that that one friend didn t text me, I figured she was probably busy. That friend name was Kim. Kim was one of those that told her honest opinion about everyt hing and get got really irritating. Anyways as I was laying down my phone lit up which meant I got a Snapchat message. It was Kim, I assumed that she was probably going to say something like â€Å"Stop laying there and get up and take some medicine† so I wait a little to read it. When I finally read my whole mood changed she said â€Å"I don t care that you hate me me because honestly I feel like your fake†Ã¢â‚¬  I am clearly annoyed because nothing I was feeling was because of her or direct towards her. But my nose cringed at the word â€Å"fake†. Me and Kim had a history she had a smart mouth so nobody really liked her so I was really her only friend. I lost friends because they didn t want me to be friends with her and stuff like that. Anyways I was far from â€Å"fake†. I.texted her and said â€Å"Wait one minute Kim how in the world am I fake† she goes on to say â€Å" You don t talk to me how you talk to your other friends and I don t need you to be my friend i’m not being you too† at this point I am heated because that was a lie but if I did it was because she was acting like a butt. I took the intuitive to call her and get to the bottom of.it. The conversation starts out going sensitive and intense until it was my turn to talk she kept screaming â€Å"fake fake fake† so I started getting loudShow MoreRelatedMy Personal Narrative Of My Life1261 Words   |  6 PagesThis will be a long personal narrative about my current stressful life. Before, I came down to the University of Georgia to work with the football team my life back in East Lansing, Michigan was quite peaceful. 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Investing In Liquid Or Non Liquid Assets - Free Essay Example

Sample details Pages: 18 Words: 5465 Downloads: 7 Date added: 2017/06/26 Category Finance Essay Type Research paper Did you like this example? CHAPTER 1: Liquidity was found to be one of the most important unresolved problems in the field of corporate finance (Brealy and Myers, 1996). In addition, the same studies found that the liquidity management was the pinpoint of determining both future investment opportunities and future capacity of external borrowing. Firms, in general, invested in the most liquid assets. Don’t waste time! Our writers will create an original "Investing In Liquid Or Non Liquid Assets" essay for you Create order Liquid assets made up a considerable segment of total capital or assets and had the more important implications for the risk and profitability of firms (John, 1993). For instance, according to Kim, Mauer, and Sherman (1998), the average ratio of cash plus marketable securities to total assets (Liquidity) was 8.1% during the period of 1975 to 1994 of a sample of 915 industrial firms of the United States of America. Kim et al. (1998) analyzed both the costs and benefits of holding the liquid assets and concluded that the investment in liquid assets (e.g., Treasury Securities) was more costly because by investing in liquid assets, the firms accepted opportunity cost of investing in less liquid and more rewarding assets; furthermore, the firms also bear transaction costs of trading financial securities. But firms managed significant and predictable amounts of excess liquid asset holdings because of the capital market imperfections provided a strong logic to maintain some excess liquidity to tackle some emergencies. Huberman (1984), Ang (1991), and Myers and Rajan (1995) had noted that liquid assets might prompt more severe agency problems than less liquid assets. Specifically, if and only if the external financing was costly, the investment in liquid assets was the most advantageous reply to having to seek costly external financing to fund future production needs or investment opportunities and the costs of external financing included the direct expense to issue securities, the costs arising from potential agency conflicts, and costs arising from the adverse selection problems attributable to asymmetric information (Smith, 1986). Thus, investment in surplus liquidity can be viewed as a cost-effectively rational way to reduce the firms reliance on costly external financing. Obviously, any such remuneration must be balanced against the holding costs that liquid assets force on the firm. Liquid assets earned a low rate of return as compared to the less liquid asset s. However, the firms despite decided to hold a positive amount of liquid assets provided undecided future in-house funds and costly external financing. Hence, it was concluded that there was a tradeoff between the holding cost of liquid assets (a low rate of return) and the benefit of minimizing the need to seek costly external financing if internally generated funds were insufficient to finance future investment opportunities. According to Horne and Bowers (1968), liquidity can be expressed as the ability to realize value in an accepted means of exchange. Being the acceptable means of exchange, money was the most liquid asset and was also a benchmark against which the value of other type of monetary assets was compared as to its degree of replacement. In addition, liquidity had two dimensions: the one was the time required to convert the asset into money, and the other was the certainty of the price realized, i.e., the stability of the exchange ratio between the money and the a sset. In the business world, there was the high corporate demand for liquidity and firms in the real, financial and industrial sectors managed its liquidity needs in the numerous ways in order to carry out further production and investment plans efficiently without being stopped by impermanent liquidity deficiencies. The firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ decisions regarding the future ability to avail financial funds was affected by several key factors such as the capital structure set deadlines for settling the amounts to investors, corporations did not invest all of its resources in the most profitable, long term projects and in fact they also invested funds in less profitable liquid assets, the corporations engaged in the risk management and derivatives were used to evade the particular risks (such as rate risk, exchange rate risk, etc.), and lastly, international risk burden was also measured by the companies. (Holmstrom and Tirole, 2000) 1.2 Problem Statement In the corporate finance, the liquidity was considered to be one of the most important issues. The main objective behind the study of the corporate liquidity was that this was the most important issue for the present firms to either invest in the more liquid assets or to invest in the less liquid assets. Furthermore, investment in liquid assets was prompted by several other factors such as the future investment opportunities and future uncertain cash flows and the external costly financing. Contrastingly, the investment in less liquid assets attracted the corporations because of the high rate of return of such investments. The purpose of the study was to notice whether the financial factors explained in detail by Kim and David and Ann (1998), and John (1993), present the detail regarding the choice of the firm to invest in liquid or non liquid assets in Pakistan. The scope of study was to analyze the distinctive financial factors which affected the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ decisi ons to place their funds in more liquid assets and on the basis of firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ financial factors, the research study determined the choice of investing in liquid assets or the choice of having internal liquidity. 1.3 Hypotheses A central query in front of firms which needed new finance to invest in operational activities was whether to use internal funds generated through the most liquid assets or to raise the costly external financing. Various factors impacted the decision regarding the decision to invest in liquid assets (liquidity). The firmà ¢Ã¢â€š ¬Ã¢â€ž ¢s characteristics had the great importance in selection of the investment decisions; these characteristics were firm size, operating income to sales ratio, operating income to total assets ratio, market to book ratio, inventory plus gross fixed assets to total assets ratio, log natural of annual sales, total debt ratio, and long term debt ratio. Many authors as Kim and David and Ann (1998), John (1993) discussed these characteristics in research. The hypothesized relationship of these listed factors with liquidity is provided below: H1: There is negative impact of Firm Size on Liquidity. H2: There is negative impact of Total Debt Ratio on Liq uidity. H3: There is negative impact of Long-Term Debt Ratio on Liquidity. H4: There is positive impact of the ratio of the Market to Book Value of Equity on Liquidity. H5: There is positive impact of the ratio of Operating Income to Sales on Liquidity. H6: There is negative impact of the Operating Income to Total Assets ratio on Liquidity. H7: There is negative impact of the ratio of Inventory plus Gross fixed assets to Total Assets on Liquidity. H8: There is positive impact of sales of firms on liquidity. 1.4 Outline of the Study The research structured as follows. Chapter one was based on the introduction of the thesis, which consists of the some introduction of the liquidity by different authors, the statement of problem, scope and objectives, hypothesis etc. Chapter two consisted of literature review given by different authors, theories on liquidity and factors affecting the choice of decision to invest in more liquid assets or not. Chapter three described methodology which is composed of justification of the selection of the variables utilized in analysis sample, the data, technique and hypothesis, also estimate model utilized in analysis. In chapter four, analyses of the results were there which were taken after the data processing. Chapter five contained the final results, conclusions and recommendations. References were included in chapter number six. CHAPTER 2: LITERATURE REVIEW When a firm wanted to invest in a project or production facilities, there was a question before the firm that it should use its own funds or retained earnings or raise an external financing. The firmà ¢Ã¢â€š ¬Ã¢â€ž ¢s answer to this question did not affect the wealth of security holders in the world of Miller and Modigliani (1961) where the capital markets were perfect. However, among other things, the capital market perfection means the absence of liquidity problems. Resultantly, all assets can be exchanged for cash and vice versa and that exchange was made at the market value and it does not entail a loss. (Huberman, 1984) The real markets were not quite perfect and one can see a variety of reasons about it. Consider the example of firms wishing to finance new projects by issuing claims on the projects. If the firms knew more about the projects than the outside world knew and the claims were considered risky, a market collapse may take place (Ackerlof, 1970). If the firms bel ieved their projects were good, will perceive that their claims were undervalued by the market and will not issue such claims and only the projects of pessimistic firms will be financed (Huberman, 1984). Finally, it was the best option that a firm used its own liquid assets to invest quickly without going to the capital market under certain circumstances. Hence, it was the most desirable that a firm possesses the excess liquid assets in the real world of capital markets imperfection (Huberman, 1984). There was a vast literature available on the liquidity and one of the most prominent theories of liquidity is the Liquidity Preference Hypothesis (LPH). 2.1 Liquidity Preference Hypothesis (LPH): The Liquidity Preference Hypothesis (LPH) gave details that the return on government securities was a monotonically rising function of the time to maturity. That was, restricted on all on hand information, the probable monthly return on a T-bill with one year to maturity should surpass the probable monthly return on a six month T-bill, which should be better than the sure yield on a one month T-bill, and so on. Regardless of the shape of the term structure or any other economic variables contained in the agentà ¢Ã¢â€š ¬Ã¢â€ž ¢s information set, the LPH meant this condition. The underlying intuition behind the LPH was that the longer term bonds are riskier; that was, they were more susceptible to the fluctuations or volatility in interest rate than the shorter term bonds and the individuals needed to be compensated for the risk of holding these bonds, hence, the higher predicted yield. (Boudoukh, and Richardson, and Smith, and Whitelaw, 1999) The LPH did not worry about the choi ces investors made between the whole variety of financial assets, on the one hand, and other broad classes of assets, on the other. LPH took as given the choices determining how much wealth was to be invested in financial assets and concerned itself with the distribution of these amounts among cash and substitute financial assets. An issue can be identified here; that is, why should any balances be held in cash, in preference to other financial assets? The author distinguished two possible sources of liquidity preference, while recognizing that they were not mutually exclusive. The first was inelasticity of expectations of future interest rates. The second was insecurity about be future of interest rates. (Tobin, 1958) Tobin (1958) argued liquidity preference as the theory of most advantageous portfolio masterpiece in a two-asset (money, bonds) world in which one asset (money) was riskless in his original paper. The basic conclusion of Tobinà ¢Ã¢â€š ¬Ã¢â€ž ¢s theory of liquidity preference and portfolio choice rested on the properties entitled to these  µ-à ¡Ã‚ »? curves. According to Lachmann (1937), in current literature there appeared to be present a reasonable amount of conformity among writers that uncertainty had to be looked upon as the foremost determinant of movements in the size of cash balances, i.e., as the main cause of liquidity preference. At more rapidly scrutiny, though, this noticeable agreement came out as to some extent full of twists and turns, because diverse writers gave this word a different meaning. In the following, it was only restricted to the assessment of two examples of monetary theories in both of which the most important role was allocated to uncertainty, and it was found based on the research that in each case the word had a different meaning. After that, the results of the critical assessment of these theories will be used in the best way with the intention to find that meaning of à ¢Ã¢â€š ¬Ã…“uncertainty wh ich will enable the research study to regard it as the cause of liquidity preference. Uncertainty was but one of a lot of grounds of liquidity preference. Possibly the failure of the author to set up a causal association between uncertainty and liquidity preference was due to the authorà ¢Ã¢â€š ¬Ã¢â€ž ¢s having used the word uncertainty in too broad and too indefinite a meaning. The endeavor to ascertain a causal association between uncertainty and liquidity preference had up to now driven out to be an absolute failure. Wells (1983) had publicized that want for liquidity was an indispensable economic reaction to the not able to be understood and considerably variegated future which always lied to the front. Liquidity was valued in an indecisive world because it afforded economic units the preference of not entirely host aging their own economic future to the uncertain future of the economy. Its ownership provided businesses and households the elasticity to reorganize their econo mic plans, to redistribute their wealth as the future slowly opens out and becomes the past, as acquaintance was gained with the simple passage of time. In short, this was Keyness (1937) theory of liquidity preference. And from just this explanation it can be simply understood why his hypothesis, as it was remade by subsequent generation of writers, turned out to be detached from Keyness (1937) unambiguous acknowledgment of the central significance of time and uncertainty, of liquidity and liquidity preference. The disconnection came about largely because the fact that our information of the future was unpredictable, indistinguishable, and doubtful demonstrated to be a perception far too short lived to support contemporary quantitative model building research. Keyness concepts were real, but they were necessarily so unclear and imprecise that model builders could not well integrate these phenomena into their analytics. Kaldor (1981, 1982) for instance observed that the stress on liquidity preference as a theory of the demand for money had made an immense contribution to the accomplishment of monetarism. As long as the demand for money could be shown statistically to be less than perfectly elastic and the supply of money to be determined independently enough from the demand, the supply of money was the major determinant of economic activity. This investigation presented here puts emphasis that liquidity preference was a theory of the desire to hold short- versus long-term assets and that the state of liquidity preference was presided over primarily by the productivity of business. (Mott, 1985-1986) According to the Keynesà ¢Ã¢â€š ¬Ã¢â€ž ¢s liquidity preference theory, the authorities achieved their objectives, which the author understood to be set with respect to the level of the interest rate, against the background of liquidity preference. The interest rate was changed not only by varying the rate at which the central bank was all set to discount (Bank rate), but also by open market operations: sale or purchase of securities between the central bank and the other market members. According to Reilly and Brown (2005), the theory of Liquidity Preference hold that the higher returns must be given on the long term investments than the shorter ones because some of the yields and returns to invest in the short term investments were given up by the investors in order to avoid the greater price fluctuations of the securities having longer life. Another way to interpret the liquidity preference hypothesis was to say that lenders preferred short term loans, and, to induce them to lend long term, it was necessary to offer higher yields. The liquidity preference theory was also called the Term Premium Theory and it asserted that uncertainty and volatility caused investors to favor short term issues over bonds with longer maturities because short term securities were less volatile and can easily be converted into predictable amounts of cash should unforeseen events occur. This theory argued that the yield curve generally sloped upward and that any other shape should be viewed as a temporary deviation. To see how the liquidity preference theory predicted the future yields and how it compensated with the pure expectations hypothesis, to predict future long term rates from a single set of one year rates: 6 percent, 7.5 percent, and 8.5 percent. The liquidity preference theory suggested that investors added increasing liquidity premiums to the successive rates to derive actual market rates. As an example, investors might arrive at rates of 6.3 percent, 7.9 percent, and 9.0 percent. As a matter of the historical fact, the yield curve showed an upward bias, which implied that some combination of the liquidity preference theory and expectations theory will more accurately explain the shape of the yield curve than either of them alone. Specifically, actual long term rates consistently tended to be above what was envisioned fr om the price expectations hypothesis. This tendency implied the existence of a liquidity premium. The liquidity premium was provided to compensate the long term investor. CHAPTER 3: RESEARCH METHODS 3.1 Method of Data Collection Data was collected from Karachi Stock Exchange KSE 100 Index as given by State Bank of Pakistan in publication Balance Sheet Analysis of Joint Stock Companies Listed on the KSE (2003-2008). The period of study covered six years, 2003-08. The opted sample size of 70 non financial firms was taken from KSE 100 Index and all of the non financial firms listed on KSE 100 Index were selected for the samples which were either manufacturing firms or service providing firms excluding the financial firms. The objective behind the exclusion of the financial firms from the sample was that liquidity impact of the financial firms and non financial firms was entirely different. 3.2 Sample Size A sample of 70 non financial firms from KSE 100 Index was taken. Only firms were used in the samples which were only the non financial firms which included the industrial firms and service providing firms listed on the KSE 100 Index form 2003-2008. The impact of the different financial factors on the liquidity was analyzed on all of the non financial firms selected as the sample. 3.3 Research Model Developed There were various financial factors of the non financial firms which affected the liquidity of the firms. This research study analyzed the impact of different factors on the liquidity. The factors, their relation with the liquidity, their measurement formula and the hypothesized relationship with liquidity were discussed below following the discussion after à ¢Ã¢â€š ¬Ã‹Å"Liquidityà ¢Ã¢â€š ¬Ã¢â€ž ¢. 3.3.1 Liquidity According to Horne and Bowers (1968), Liquidity can be expressed as the ability to realize value in an accepted means of exchange. Being the acceptable means of exchange, money was the most liquid asset and is also a benchmark against which the value of other type of monetary assets was compared as to its degree of replacement. In addition, liquidity has two dimensions: the one was the time required to convert the asset into money, and the other was the certainty of the price realized, i.e., the stability of the exchange ratio between the money and the asset. Kim and David and Ann (1998), and John (1993) both measured the liquidity as the ratio of cash and marketable securities to total assets. 3.3.2 Firm Size and Liquidity Recent research showed that small firms were more likely to face borrowing constraints than large firms Gertler and Hubbard (1988), Whited (1992), and Fazzari and Petersen (1993). In addition, Barclay and Smith (1996) argued that the cost of external financing was smaller for larger firms because of scale economies resulting from a substantial fixed cost component of security issuance costs. H1: There is negative impact of firm size on liquidity. 3.3.3 Total Debt Ratio and Liquidity The firms debt ratio was expected to be negatively related to liquid assets. There were at least two reasonable reasons. Baskin (1987) argued that as the firms debt ratio increased, the cost of funds used to invest in liquidity increased thereby reducing funded liquidity. Additionally, John (1993) argued that firms with access to debt markets-as proxied by the debt ratio-can use borrowing as a substitute for maintaining a stock of liquid assets. Firms with ready access to debt markets and other sources of borrowing can also use debt as a substitute for liquidity maintenance. H2: There is negative impact of total debt ratio on liquidity. 3.3.4 Long Term Debt Ratio and Liquidity Baskin (1987) argued that as the firms long term debt ratio increased, the cost of funds used to invest in liquidity increased thereby reducing funded liquidity. Additionally, John (1993) argued that firms with access to debt markets-as proxied by the long term debt ratio-can use borrowing as a substitute for maintaining a stock of liquid assets. Firms with ready access to debt markets and other sources of borrowing can also use debt as a substitute for liquidity maintenance. H3: There is negative impact of long term debt ratio on liquidity. 3.3.5 Operating Income to Total Assets and Sales Ratio and Liquidity According to John (1993), similarly, operating incomes or cash flows provided a ready source of liquidity. Firms with ready access to debt markets and other sources of borrowing can also use debt as a substitute for liquidity maintenance. Therefore, firms with good operating incomes (OI/S or OI/TA) or ready sources of financing (proxied by measures of debt) can afford to keep lower levels of liquidity. Hence, liquidity ratios (LIQR) would be lower for firms with higher operating incomes. H4: There is negative impact of operating income to total assets ratio on liquidity. H5: There is negative impact of operating income to sales ratio on liquidity. 3.3.6 Inventory and Gross Plant and Equipment to Total Assets Ratio and Liquidity Another measure of the liquidity costs of asset restructuring was the collateral value of the assets Shleifer and Vishny (1992). Titman and Wessels (1988) suggested proxies for the collateral value. The ratio of inventory plus gross plant and equipment to total assets (IGP/TA) was positively related to collateral value. The liquidity costs of asset restructuring were negatively related to collateral value. A firm with assets of high collateral value needed only to maintain low levels of liquidity. In other words, the liquidity measures will be decreasing in IGP/TA. H6: There is negative impact of inventory and gross plant and equipment to total assets ratio on liquidity. 3.3.7 Market to Book Ratio and Liquidity Myers (1977) argued that risky debt financing may engender sub- optimal investment incentives when a firms investment opportunity set included growth options. Managers acting on behalf of equity holders may fail to exercise profitable investment options because debt captured a portion of equity holders return in the form of a reduction in the probability of default. The firm can reduce the risk of financial distress and thereby mitigate the incentive to under invest in growth options by maintaining excess liquidity. This view also predicted a positive relation between corporate liquidity and the market-to-book ratio. H7: There is positive impact of market to book ratio on liquidity. 3.3.8 Sales and Liquidity According to John (1993), the variable sale was one of the control variables to account for the level of liquidity justified by transaction and precautionary motives. The variable sales proxy for the transaction needs of the firm. H8: There is positive impact of sales on liquidity. The model developed was a linear model and its specifications are provided below: LIQR = a0 + a1FIRM + a2DEBT + a3LTD + a4LSALES + a5OI/S + a6OI/TA+ a7 IGP/TA+ a8Market to Book Ratio + ц LIQR = the sum of cash and marketable securities divided by total assets FIRM = natural log of the book value of total assets DEBT = the ratio of shorter period plus longer period debt to total assets LTD = the ratio of longer period debt to total assets LSALES = natural log of the annual sales OI/S = the ratio of operating income to sales OI/TA = the ratio of operating income to total sales IGP/TA = the inventory plus gross fixed assets to total assets ratio à Ã¢â‚¬Å¾ = the error term The proposed relationship of the independent variables on liquidity is summarized in the below table: TABLE 3.1 : Relationship between Independent Variables and Liquidity  Firm Size Debt LTD OI/TA OI/S IGP/TA Market to Book Sales Liquidity negative negative negative negative positive negative positive positive 3.4 Statistical Technique Multiple Linear Regression Analysis (MLR) technique was used for this research study to examine the impact of the distinctive financial characteristics of the non financial firms on their liquidity of the selected firms; Statistical Package for the Social Sciences (SPSS) was used for the examination of the secondary data. Multiple Regression Analysis technique was used for the purpose of prediction of the decision of the non financial firms to invest in the liquid assets or not. The selected technique was used to study the impact of the different independent variables (financial factors as listed in the previous chapters) on the dependent variable i.e., liquidity. The multiple regression analysis was selected for this study because the multivariate analysis was more suitable than univariate investigation. In such a way; to openly taking into consideration, the interaction between multiple regressing variables, the study included the derivation of the linear regression function. It showed the intensity of the impact on liquidity during year 2003-2008 on the basis of several independent variables. CHAPTER 4: RESULTS The sample of 70 non financial firms from the Karachi Stock Exchange KSE 100 Index was taken; Multiple Regression Analysis (MLR) technique was used for this research study. Researcher examined the distinctive financial characteristics of non financial firms which invest in the more liquid assets. The selected technique was used to study the impact of the different independent variables (financial factors as listed in the previous chapters) on the dependent variable i.e., Liquidity. 4.1 Findings and Interpretation of the results Initially, the regression technique was applied on the data collected using SPSS. It was obvious from the results that there was the existence of strong multicollinearity among the predictors of the liquidity and this implies that there was strong interrelationship present among the independent variables. Hence, the results generated through SPSS were purely biased. In addition, there was the absence of the normality among the variables. Due to non normality, the results were not providing the true picture of the impact of the different predictors on the study variable. While resolving the problem, it was noticed that the main cause of the multicollinearity among the predictors was due to the two independent variables including firm size and annual sales. So, annual sales variable was removed from the analysis of the impact of different factors on liquidity. Hence, the multicollinearity issue was resolved. In resolving the issue of normality, various transformations were appl ied on the variable in order to normalize the variable so that the results could be more reliable; and accurate outlook of the true picture of liquidity can be made. Ultimately, all the issues were successfully resolved which were creating hindrances in the way of accuracy of results. Now, proceeding with the analysis of the results because the data was normal and there was also no multicollinearity issue in the data. The interpretation and analysis is presented in the next sections of this research study. TABLE 4.1 : Model Summary Model R R Square Adjusted R Square Std. Error of the Estimate 1 .724a .524 .439 .06894 Table 4.1 showed the summary regarding the regression model. The R square of 52.4% in the above table showed that the all the predictors of liquidity combined together explained 52.4% variation in the dependent variable and the remaining variation was unexplained or latent predictors were not included in the model. TABLE 4.2 : ANOVA Model Sum of Squares Df Mean Square F Sig. 1 Regression .204 7 .029 6.141 .000a Residual .185 39 .005   Total .390 46    The table 4.2 checked the significance of the linear regression model in such a way that the reliability of the data file regarding the applicability of the regression technique can be understood from the above table; however, ANOVA table was reliable test of checking the linear regression modelà ¢Ã¢â€š ¬Ã¢â€ž ¢s ability to explain any variation in the dependent variable of liquidity. This was perfectly obvious from the sig value of .000 which meant that the linear regression model was highly significant for the data collected for the research study conducted. TABLE 4.3 : Coefficients Model Unstandardized Coefficients Standardized Coefficients t Sig. Collinearity Statistics B Std. Error Beta Tolerance VIF 1 (Constant) .379 .146  2.597 .013   Debt Ratio .053 .450 .018 .119 .906 .515 1.942 Long-Term Debt Ratio .718 .842 .138 .854 .398 .466 2.148 Operating Income to Total Assets Ratio .718 .967 .144 .742 .462 .325 3.072 Square Root of Operating Income to Total Sales Ratio .449 .389 .202 1.154 .255 .397 2.519 Square Root of Inventory plus gross plant and equipment to total assets -.823 .168 -.648 -4.891 .000 .696 1.438 Natural Logarithm of Market to Book ratio .001 .017 .010 .066 .948 .534 1.871 Firm Size .000 .009 .000 -.001 .999 .858 1.166 In the table 4.3, the final model of regression included only one independent variable which was square root of inventory plus gross fixed assets to total assets ratio. This was included in the model because this was the only variable which was highly significant in playing a vital role in explaining the variation in the dependent variable of liquidity ratio. In short, these results were not consistent with the results of Kim and David and Ann (1998), and John (1993). The other independent variables were not significant in explaining the variation in the dependent variable of liquidity ratio because firstly, the economic and the financial environment was different; secondly, the behavior of the non financial firms was not same as that of the foreign firms in regard of liquidity; and lastly, the decisions of the firms regarding the portion of their investments in liquidity were affected by the political situation and the security threats of Pakistan. 4.2 Hypotheses Assessment Summary The hypothesis of the study was distinctive financial factors had significant impact on the non financial firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ decision to invest in more liquid assets. These financial characteristics were market to book ratio, inventory plus gross fixed assets to total assets ratio, operating income to sales ratio, firm size, operating income to total assets ratio, total debt ratio, long term debt ratio, and natural log of sales. In this study each of the financial characteristic of non financial firms was tested and concluded the results. TABLE 4.4 : Hypotheses Assessment Summary S.NO. Hypotheses ÃŽÂ ² t SIG. RESULT H1 There is negative impact of Total Debt Ratio on Liquidity. 0.053 0.119 0.906 Rejected H2 There is negative impact of Long-Term Debt Ratio on Liquidity. 0.718 0.742 0.398 Rejected H3 There is positive impact of the market to book ratio on Liquidity. 0.001 0.66 0.948 Rejected H4 There is positive impact of the ratio of Operating Income to Sales on Liquidity. 0.449 1.154 0.255 Rejected H5 There is negative impact of the Operating Income to Total Assets ratio on Liquidity. 0.718 0.742 0.462 Rejected H6 There is negative impact of the ratio of Inventory plus Gross fixed assets to Total Assets on Liquidity. -0.823 -4.891 0.000 Accepted H7 There is positive impact of firm size on liquidity. 0 -0.001 0.999 Rejected H8 There is positive impact of sales on liquidity. Rejected CHAPTER 5: DISCUSSIONS, CONCLUSION, IMPLICATIONS AND FUTURE RESEARCH 5.1 Conclusion It was concluded based on the results of this research study that inventory plus gross plant and equipment ratio was only the independent variable which was showing significance in Pakistani market. And the remaining independent variables could not explain the variation in liquidity. These results were not matching with the study conducted by Kim and David and Ann (1998), and John (1993). These results were varying because in various countries, the macroeconomic conditions and the financial environment were entirely different from each other and in addition, the security problems and political situation also affected the liquidity and firms made decision accordingly. 5.2 Discussions Firm size could not play a significant role in defining the liquidity in this research thesis and this was also the case with the research study conducted by Kim and David and Ann (1998) because in their study the firm size was not playing a significant role. The variation in the liquidity was not explained by the market to book ratio while it was significant in the study done by Kim and David and Ann (1998). The operating income to sales ratio, operating income to total assets ratio, debt ratio, long term debt ratio, and sales were not significantly explaining the variation in the liquidity and study analyzed by John (1993) provided different results from that of the results concluded by this research thesis. 5.3 Implications and Recommendations This research was limited to the various firms listed on Karachi Stock Exchange of Pakistan only. The data taken from 70 non financial firms which were took through various sectors of the KSE 100 Index for the year 2003-08. It suggested that such type of study should be carried out in other countries of Asia as well, as to have comprehensive idea about the choices of the firmsà ¢Ã¢â€š ¬Ã¢â€ž ¢ decision to invest in liquid assets. Moreover, it also suggested that other factors except ones examined in this study should be researched as to have perfect idea about the selection of liquidity decisions. Besides that, this study can also be replicated in other developing countries. 5.4 Future Research This study helped various investors, management and other research conductors in analyzing and observing the behavior of firms regarding their decisions to invest in liquid assets. Research students who want to work further on liquidity can be benefited by this research study. Further more, the non financial firms will become advantageous from this study because the study clarified the distinctive characteristics of different firms which significantly explained the variations in the liquidity.

A General Model Of Colonialism And Underdevelopment

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THE INVENTION OF UNDERDEVELOPMENT At the end of World War II, the United States was a formidable and incessant productive machine, unprecedented in history. It was undisputedly at the centre of the world. It was the master. All the institutions created in those years recognized

Management and Organizations Environment of Ford and Taylorism

Question: Discuss about the Management and Organizations in Global Environment Ford and Taylorism. Answer: Ford and Taylorism Taylorism Taylorism refers to application of scientific management in work process which would break a particular task into numerous sub-tasks so that production could increase. It emphasises on maximising production efficiency by minimizing the requirement and application of skills. In the present business situation, specialists in America, Australia and Europe would not welcome Taylorism procedure since there have been significant changes in the technological and innovative aspects of work process. The Taylor model does not enhance the skill level of the workers and there is no wisdom involved in adopting this old theory (Axelrod VanDeveer, 2014). The workers of the present generation are willing to increase their skill-set and knowledge base since the prevailing business environment is highly competitive. Since work related skills and knowledge is not encouraged in the Taylorism model, workers would not want to get involved in just a mechanical process which does not involve any skill and knowledge transfer (Axelrod VanDeveer, 2014). Explain Taylorism in that! The implementation of the Taylorism model can be useful in the designing aspect of scripts for the use in call centres to a limited extent. Since the activities and operations involved in the call centre set-up are mainly grouped into different categories based on the sector that specialize in the particular function (Axelrod VanDeveer, 2014). There is scope to divide the work process in a call fixate contingent upon the zone of learning, ability and occupation part of representatives and in like manner allot particular employment to the call focus workers by adopting the taylor scientific management model. But this work method will not come in handy when a new or different situation arises which needs a different kind of a solution. There will be many enterprises and organizations around the world which can receive the Taylorism technique for work. The essential standards which are followed in the process like division of work, high pay for diligent work, utilization of straightforward creation methods are the foundation for ant start-up business concern. The accurate application of Taylorism in the current scenario can help relevant firms to get good results (Axelrod VanDeveer, 2014). Corporate culture Why Zappos Employees Quit Zappos has incorporated an unconventional strategy in its recruitment process, i.e., paying the new employees on after the first week of training after joining to quit. The employees who are newly recruited and would quit the same moment would also be awarded with extra $ 1000. This unique and unconventional strategy has worked for the online shoe retailer in engaging deep level of commitment from its employees, especially to check and keep the new employees who are new to the company and are actually willing to work for the company for long term (Collings, 2014). The very human work culture inculcated by Zappos has worked in favour of the company to keep the employees, whether new or old, to be proactive and enthusiastic to work for the company along with providing best of the customer service (Erez, et al., 2013). The employees have the liberty of deciding the work culture every year. The intention of the company to retain the new employees by paying them is to layer out the best and the most interested employees for providing best customer service by paying the employees who have the probability of engaging less in providing service in the company. The company does this to keep the candidates who are actually fit for the job. Building a culture-based company The CEO of Zappos, Tony Hsieh, believes in having great work culture in the organization. Having very flexible work culture in the organization paves a way to invite in better customer service and generation of sales for the company. If a company has great organization culture, building of an excellent brand image becomes an eventual outcome. The work culture can also lead to having efficient employees right from the recruitment process who would work and provide efficient productivity on a longer term (Frynas Mellahi, 2015). A better organization culture would lead to maximizing profits and generation of better revenues on a longer term. A flexible and innovative company culture would lead to keeping the employees content and more inclined towards the organizations even during the crisis. An open and flexible work culture also enhances the creative pool of the company which leads to the generation of various ideas both in quality and quantity (Frynas Mellahi, 2015). The company having more number of ideas would result in the innovation of the services and products along with the whole organization which would be beneficial for the company for a longer them. A better organizational culture enhances the productivity of a company as a whole. References Axelrod, R.S. and VanDeveer, S.D. eds., 2014.The global environment: institutions, law, and policy. CQ Press. Botha, A., Kourie, D. and Snyman, R., 2014.Coping with continuous change in the business environment: Knowledge management and knowledge management technology. Elsevier. Brady, J., Ebbage, A. and Lunn, R., 2013.Environmental management in organizations: the IEMA handbook. Routledge. Brown, B.E., 2016. Regional fishery management organizations and large marine ecosystems.Environmental Development,17, pp.202-210. Collings, D.G., 2014. Integrating global mobility and global talent management: Exploring the challenges and strategic opportunities.Journal of World Business,49(2), pp.253-261. Erez, M., Lisak, A., Harush, R., Glikson, E., Nouri, R. and Shokef, E., 2013. Going global: Developing management students' cultural intelligence and global identity in culturally diverse virtual teams.Academy of Management Learning Education,12(3), pp.330-355. Frynas, J.G. and Mellahi, K., 2015.Global strategic management. Oxford University Press, USA. Hislop, D., 2013.Knowledge management in organizations: A critical introduction. Oxford University Press.