Sunday, January 26, 2020

Effects of Audit Fees on Audit Quality

Effects of Audit Fees on Audit Quality Chapter 1 In this part of dissertation, there is a grief introduction about this dissertation, which includes the following context: the background and overview of related researches in this paper; the motivation for doing this study and a introduction of the structure of this paper. Introduction Firth (1997) notices that the responsibility of auditor is reporting comparative correct financial information to shareholders in an independent position. However, what makes regulators concern more about is the client-auditor relationship, especially the economic relation, which formed in the long-term cooperation may have impact on auditors independent position. For a long time, because of the dependence of auditors fees on client firms, therefore, the controversy about whether this economic dependence might impair auditors independence position and audit quality make many empirical researches in the area. The impairment of audit independence caused by the economic relationship will result in the audit opinion shopping. Previous studies consider about the affects of audit fees on audit quality in two ways: high audit fees paid to auditors may be the reflection of the complexity of auditing process and also increase auditors effort. However, on the other hand, large audit fees paid to auditors might easy to build the economic bonding between client and auditors, thus, auditors are easy to compromise to audit independence, as the fear of losing highly profitable fees. Though a lot studies have researched the relationship between audit fees and audit quality, most of the studies just have blue results for their studies (Hoitash, Markelevich and Barragato, 2007). Basing on the theory that examining the fees paid by client firms will better analyze the relation between audit independence and audit quality, this paper uses the methodology consistent with the way used in previous studies, i.e. Kinney and Libby (2002), Choi, Kim and Zang (2006), Hoitash et al (2007), in which develop a methodology that is depended on the notion that audit fees related to expected fees have effect on audit independence and quality. Therefore, being same as previous studies here will use to audit fees model to measure the expected fees in order to compare with the actual fees paid to auditor. Using the methodology in Choi, Kim and Zangs (2006) study, the differences between actual fees and expected fees are divided into two parts: the positive one and negative one, which helps us to compare whether there is any different reflection when auditors are paid less or excess their expectation. As for the proxy for examining audit quality, the discretionary accruals mode l which drawn from previous literature are selected. As suggested by Choi, Kim and Zang (2006), the modified Jones model for discretionary accruals is used in this paper. The variables in models are selected according to previous studies which consider the influence on audit fees from perspectives of client firms sizes, auditing risk, complexity and the size of audit firms (Chan, Ezzamel and Gwilliam, 1993). Beside dividing abnormal fees into positive subsample and negative subsample, the combined sample is cut into other two subsample which are based to the sizes of audit firms, which aims to examine the different behaviors to audit fees between BIG4 auditors and NON-BIG4 auditors. Thus, the objective in this paper is to prove whether abnormal fees might result in lower audit quality and whether there is different behavior to abnormal fees between BIG4 and NON-BIG4 auditors. Continuing the previous study which is finished by Chan, Ezzamel and Gwilliam (1993), this study uses the data collected from UK market in order to find out related evidence from this market and 787 observations cover the period from 2006-2008 are collected from UK quoted public companies will help to examine audit fees paid to auditors. In addition to examine the relation between abnormal audit fees and audit quality, this study also follows the investigation which is finished by Ashbaugh, LaFond and Mayhew (2003) which focuses the study on whether the payment of non-audit fees has influence on audit independence. To extent this study, the paper here will test the ratio of non-audit fees to total fees paid to auditors which aims to find whether there is a positive relation between increased ratio of non-audit fees and decreased audit quality. Being different with Ashbaugh et als (2003) research which analyzes non-audit fees in full sample, this non-audit fees here will be analyzed in subsample with positive abnormal fees and subsample of negative fees respectively, thus, whether non-audit fees have different influences on audit quality when auditors are paid higher or lower fees than their expectation should be examined. The motivation for doing this study is based on the aim that finding out whether the economic bonding between auditors and client firms is existed really, as this relationship is one of the most controversial topic in public and academic area, especially after the Enron even and the failure of Anderson, this topic motivates more and more interesting in this area. However, according to the results of previous studies, many studies failed to prove the existent of this relationship between auditors and client firms, and the results in other relative studies are ambiguous. Moreover, because of active economic environment and accounting events, most studies paid attention on American market, as for other markets, seldom of relative investigations can be found. The aim in this study is try to find out relative evidence from UK market. The structure of this paper follows: the next part is a literature review in related area which introduced both early and latest studies; and then is the development of hypotheses the resource of relative theory and the contribution of hypotheses are included in this part. The design of methodology is presented in chapter 4 which has a description of important models in detailed. Furthermore, the chapter after it is the description of sample and the result of test, which is also the center of this study. The limitation and conclusion will be displayed in the last chapter which gives an overview and comment of this study. Chapter 2 There is a literature review of relative studies in this part. The literature review covers the studies in relative area which includes the result of studies and the development of methodology related to the investigation. The primary previous studies are displayed and concluded in this chapter. 1. The importance of auditor independence Since the collapse of Enron in US and the scandal of Andersen, the worlds capital market confidence was reduced (Beattie and Fearnley, 2002). A large of the attention is paid on accounting and auditing practices, especially on the auditor independence. As some scholars (Beattie and Fearnley, 2002) point about that the independence of auditor is the base of the public confidence to audit process and the guarantee of the quality of financial information. In addition to this, rather than a benefit to investors, auditing also reduces the cost of information exchange for two sides (Douch, 1980 and Simunic, 1982). From these words, we can easily know that a high quality of auditing information might ensure the reliability of market information, therefore, many experts in this area focus their empirical researched on factors for the reduction of auditor independence in order to find out the reasons for impairing auditor independence. The economic bonding between client and auditor account f or an important position in this kind of research. 2. Review on the payment of high audit fees on opinion shopping DeAngelo (1981) shows the evidence through investigating the low balling phenomenon in audit market that when audit firms have a significant economic benefit on client firms, audit quality and independence are easy to be reduced. The same as DeAngelos (1981) research, Magee and Tseng (1990) also have similar conclusion. Authors extend the previous research (DeAngelo, 1981) to find out in which condition the economic bonding may lead to the impairment of audit independence. The study provides a result that when auditors compensation is tied to the decision of audit opinion and then, their independence is more likely to compromise to economic bonding. Frankel, Johnson and Nelson (2002) take the research in this area to provide empirical evidence for the relation between audit fees and earnings management. Their study is based on data selected from 3074 proxy statement listed in SEC in the period from Feb 5, 2001 to June 15, 2001. The evidence of this research confirms the assumption th at there is an association between audit fees and the possibility of the compromise of audit independence. Kinney and Libby (2002) continue the research from Frankel, Johnson and Nelson (2002). Through analyzing the empirical research which has been done in the previous study, authors draw up a conclusion that auditors are probable to loss their independence in reducing their willingness to resist with client-induced biased in reporting audit opinion, when there is a strong economic benefit between auditors and clients. However, some empirical tests in the same area conclude the opposite results. Craswell, Stokes and Laughton (2002) do the research to indentify whether fee dependence have impairment on audit independence. They do the research from both aspects of national market level and local market level, but they find evidence neither from national market level and local market level can demonstrate that fee dependence has negative impact on audit quality. In other words, the economic bonding is not existed in the auditor-client relationship. In the following paragraphs, literature review about the impact of abnormal audit fees and non-audit fees on audit opinion shopping are shown. 2 .1 The review of abnormal audit fees on opinion shopping From the literature review above, the evidence for the opinion shopping through the behavior of paying high non-audit fees is still absent. And some auditors (Kanodia and Mukferji,1994) point out that switching incumbent auditors cause clients loss initial engagement and negotiate fees, beside this, switching auditors is less likely for client firms to achieve clean opinion (Chow and Rice, 1982) and event more conservative audit opinion (Krishnan, 1994). Therefore, comparing with paying high non-audit services fees and switching auditors, paying auditors with higher audit fees is a more efficient and less risk approach in opinion shopping (Fang and Hong, 2004). However, although there are some proofs can provide the assumption that higher audit fees, on some extent, can exert impact on audit quality, to analyze the relation between abnormal audit fees and audit quality, there are many factors should be concerned about, as these factors (no just economic bonding) also result in high fees. Some practitioners extend their research in this area by analyzing the association abnormal between audit fees and the changes in audit opinions. Hoitash, Markelevich and Barragato (2007) consider the high audit fees paid to auditors on two aspects: one is the positive side which suggests paying high fees can increase auditors effort in their jobs, thus, the quality also be improved; the other is the negative side which suggests that high audit fees paid to auditors may enhance the economic dependence on clients, thus, auditors independence is easy to compromise to economic benefit and audit quality also reduced. In the research, they examine the fees paid to auditors between the period over 2000-2003, using two metrics to assess audit quality: the accruals quality measure and the absolute value of performance-adjusted discretionary accruals. They predict abnormal audit fees by using pricing model from previous studied Simunic (1980), and consider about the factors may have impact on fess pricing, such as risk, complexity, and company size. The outcome of this investigation shows the conclusion that abnormal audit fees might result in economic bonding and thus impair audit quality. Similarly, Choi, Kim, and Zang (2006) have the same category of abnormal audit fees: the positive abnormal fees and the negative abnormal fees, the sample in this research constituted by the data collected from 9820 listed large companies audit fees observations during 2000-2003 period. Study also choose model from Simunic (1980) to estimate the audit fees. The result of the regression model shows that evidence that the possibility of auditors independence compromise to economic bonding is depending on whether clients may pay higher audit fees than the normal fees. In another word, audit quality will be impaired by abnormal fees. Fang and Hong (2004) also issue the opinion about the abnormal fees that high fees paid to auditors may be caused by the real improvement in companies; therefore, the positive increase in audit opinion may also cause the increase in audit fees. Authors examine the relation between abnormal audit fees and audit quality by comparing the audit opinion in present year with the prior year, and find out the association between the abnormal fees and the changes of opinions. The database in this research is comprised by Chinese listed companies during the period from 2000-2002. Through the testing in regression model, authors find that the result is consistent with the positive relation between abnormal audit fees and improvement in audit opinion, which provides evidence that client companies succeed in opinion shopping through overpaying to auditors. 2.2 The relation between the size of audit firms and audit quality But one point worth researcher to notice is the higher payment of audit fees does not mean the tendency of opinion shopping necessarily. Some evidences from other area can proof that the purpose of opinion shopping is not the only reason of high audit fees. Simunic (1980) issues his opinion in the research of audit pricing that the competition in audit market is function of fees pricing. The same as this theory, the research on the low balling behavior (DeAngelo, 1981; Kanodia and Mukferji, 1994) confirm the opinion that competitive market will produce influence on audit fees. In addition to this, the audit firm sizes, the quality of auditors also have effects on audit price. Francis (1984) analyzes the effect from audit firm size on audit fees. Author researches for the evidences by comparing the differences of audit fees of Big-8 (Big-4 now) firms and of non-Big-8 firms over the period from 1974-1978 in Australian market. The research provides the evidence that there is larger size audit firms will result in higher audit fees, at the same time, study demonstrates that higher audit fee is consistent with higher audit quality. The similar research is done recently by Choi, Kim, Liu and Simunic (2008) through using a large sample from 1 5 countries and a cross-country regression. Beside this, study links the research to audit characteristic and legal environment. After analyzing the difference between the fees in Big-4 firms and non-Big-4 firms, authors achieve the conclusion that the relation between firm size and the level of audit fees is existed. According to the interview finished among auditors (Chan, Ezzamel and Gwilliam, 1993), the BIG 6 and NON-BIG6 (BIG4 now) auditors confirm that the BIG6 premium might exist if comparing with very small audit firms, but no medium size firms. The interview here reflects a phenomenon that the difference in audit fees between BIG4 and NON-BIG4 audit firms are not so obvious. 2.3 The payment of non-audit services fees on opinion shopping The provision of non-audit services by audit firms to client firms is another controversial topic in opinion shopping. Policy makers argue that the provision of audit and non-audit services to same clients is possible to reduce the level of auditors independence (Houghton and Ikin, 2001). At the same time, auditors protect themselves by arguing that supplying non-audit services does not impair their independence, because these works are often be done by different partners and staff. For a long time, researchers have never stopped investigating in the area. 3. The influence of non-audit fees on audit independence As to the audit independence, there are many definitions for it. DeAngelo (1981a, p.186) defines audit independence as the conditional probability of reporting a discovered breach; Knapp (1985) provides the definition as the ability to resist client pressure; the definition from AICPA (1992) is an attitude/state of mind; according to Magill and Previts (1991) definition, audit independence is a function of character, with the attributes of integrity and trustworthiness being key and ISB (2000) defines audit independence as the freedom from those pressure and other factors that compromise, or can reasonably be expected to compromise, an auditors ability to make unbiased decisions. Although there are somewhat differences between those definitions of audit independence, they have a common point that is the importance of objectivity and integrity (Beattie and Fearnley, 2002). Beside provide the audit services to clients, audit firms also provide other services to clients, these services are called non-audit services, such as management advisory and consulting, but the compliance related services, such as taxation and accounting advice, are also included in them. However, as many experts (Beattie, Brandit and Fearnley, 1996) point out that this kind of non-audit services related closely to the annual reporting round. Therefore, the use of consultancy for non-audit services is somewhat wrong. What is discussing most in academy about the provision of non-audit services is the potential conflict of interest faced by audit firms who receive large non-audit fees from their audit clients. For example, after the Enron case, it was disclosed that Andersen received $25m in audit services fees and $27m for non-audit fees (Beattie and Fearnley, 2002). So, such high non-audit services fees paid to audit make public and scholars to suspect that the provision of non-audit services increases the economic bonding between auditors and clients. Many investigations are based on the assumption that the provision of non-audit fees reduces auditors independence, as they fear for losing high profit engagement with clients in the future; therefore, they are probably to give up independence for high profit. 3.1 The review of the researches in association between non-audit fees and audit quality In the early 1980s, researchers had found that the percentage the revenues from providing other services in audit firms had increased lot (Barkess and Simnett, 1994). The early empirical study is done by Simunic (1984). Author establishes his study on the assumption that those client companies who purchase non-audit services have a higher audit fees paid to auditors than audit fees from those companies who do not purchase non-audit services, and both of them hire the same incumbent auditors. In this investigation, author just focus the test in Big-8 (Big-4 now) firms, which avoids the differences on audit quality, and selects a database compromise of 397 US listed companies. From the research, he finds out than there is a positive relation between non-audit services and audit fees. Simon (1985) continues previous research (Simunic, 1984) in this area by using more recent data in the period from 1978-1983. His research depends on the voluntary disclosure from proxy statements (the non-audit services fee is not disclosed that time). His research also produces the result that client firms who purchase non-audit services have higher audit fees than those companies without the engagement of non-audit services with audit firms. The evidence from UK market (Ezzamel, Gwilliam and Holland, 1996) constitutes the research on the data from 314 UK listed companies. From the study, authors found out similar result consistent with previous researches (Simunic, 1984; Simon, 1985). To be different from above studies, this study joints non-audit services with other factors together to investigate the effects on audit pricing. Many previous researches have confirmed the phenomenon that the positive relationship between the purchase of non-audit services and higher audit fees paid by clients exists. But the existence of this relationship causes regulators, practitioners and publics attention about whether this economic bonding between client firms and auditors might impair audit independence. Barkess and Simnett (1994) concern about independence on two aspects, one perspective is to examine whether those clients purchase other services from auditors are less likely to receive qualified opinion; the other one is the determination of the relationship between the provision of other services and audit service by comparing those companies who provide non-auditor services but do not change auditors and those companies change auditors. In the study, the sample is compromised by the Top 500 listed companies in Australia for each of the years from 1986 to 1990. From the study, they conclude the result that 85%of the companies in the research purchased non-audit services from the incumbent auditors and the increase in the percentage in stable in the period. In addition to this, their result supports the point that there is a positive relationship between audit fees and the provision of non-audit services. As far as the audit independence concerned, their research show that there i s not identified relationship between the supply of non-audit services and the type of audit report, as they found that there were 308 qualified opinions in the total sample of 2094 audit reports. Therefore, they concluded that there was not enough evidence can demonstrate the hypotheses that auditors were less likely to issue the qualified opinion when the level of non-audit services to clients was higher. In other words, the provision of other services does not impair audit independence. However, Wines (1994) concluded the opposite result by testing 100 public companies on the Australian Stock Exchange at 30th June 1980, in the sample, 24 of these companies were failed to do the test, therefore, and author examined the 76 left for over the period of ten years. From the test in these 76 listed companies, author drawn up the findings that 7 of 76 companies paid a higher level of remuneration for non-audit services to auditor than the provision of audit services and those companies with non-qualified opinion had higher payment of non-auditor services fees than those companies with qualified opinion (28 companies. Hence, Wines gives the summary that the evidences from the research in 76 listed companies associate with the assumption that the provision of non-audit services has impairment on auditors independence. Wines (1994) also points out the limitation in his research is difficulty in assessing audit quality by considering the frequency with which auditing firms iss ue qualified opinions. However, one problem in Barkess and Simnett (1994) and Wine (1994) studies is that their sample is not large enough in test. Craswell (1999) makes advantage in his study by using a larger data sample and makes the evidence related to auditors actual decisions. The fiscal-year data chose by author to examine are obtained from who audit Australia, the sample is consisted by 885 public listed companies in 1984, 1477 in 1987 and 1079 in 1994, the results show that in each of the year (1984, 1987, 1994) the result does not associate with the assumption that non-audit services have negative effect on auditor independence, which is consistent with Barkess and Simnett (1994). But one limitation in his research is that this study just compares the companies with qualified opinions with those companies with unqualified opinions, while a better test should compare the companies with qualified opinions with such companies with clean opinions but experienced problems and likely to raise qualifications. Although most of the investigation have done by researchers show that the provision of non-audit services does not impair audit independence, regulators still hold the assumption that auditors will prefer to give up their independence in order to obtain more non-audit services fees from clients (DeFond, Raghunandan and Subramanyam, 2002), especially after the Enron accounting scandal. In 2002, the Sarbanes-Oxley Act (the Act) imposed the prohibition on the provision of non-auditor services, which based on the direction of enhancing auditor independence, reducing conflict of interest and the concern that all non-audit services were not created equal (American Institute of CPAs, 2002). At the same time, the US Securities and Exchange Commission (SEC, 2002) made the revision the Commissions regulations related to the non-audit services, which are consistent with the content in Sarbanes-Oxley Act. After the prohibition on non-auditor services added in Sarbanes-Oxley Act and SEC was carried out, many scholars continue the prior researches in this area. Frankel, Johnoson and Nelson (2002) used a sample constituted of 3074 proxy statements, used two indicators (discretionary accruals and the likelihood of firms meeting earning benchmark), to test whether audit independence would be reduced when the non-audit services grew. The consequence of the research indicates the evidence that there is an association for the assumption that auditors likely tend to sacrifice their independence when the non-audit services fee is high. Ashbaugh, LaFond and Mayhew (2003) continued this research, but the conclusion challenges the results made by Frankel, Johnoson and Nelson (2002). In the test, they used the same indicators as prior one. In the test, they find that there is no relation between positive discretionary accruals and auditor fee metrics; furthermore, their test proof that the relatio n between fee ratio and the likelihood that firms beat analysts forecasts is not existed, in other words, auditors independence will not compromise to clients high non-audit services fees. 4. Review of the development of models In empirical studies, the relative models will help to connect independent variables together in order to analyze the relation between each variable. In the study of the relation between audit fees and audit quality, the most important models are the model for measuring audit fees and audit quality. In this part, a review of the development and modification of two models is displayed. 4.1 Review of the development of audit fees model Since Simunic (1984) develops the audit fees model in order to predict the expected audit fees, the model has been developed lot in these years. In the beginning, Simunic (1984) provides the theory that the audit fees level will be affected by the several factors, such as the client firms sizes, the complexity of auditing process, audit firms sizes and audit risk. The following scholars provide the related variables for model which the used to decide expected audit fee. Chan, Ezzamel and Gwilliam (1993) point out in their study audit size is an explanatory variable which has important influence on the determinant audit fees. In the study, authors suggest to use the measurement of turnover to control audit size, which is also the measurement of client firms sizes. However, the use of turnover as determining is not unproblematic because the definitions of turnover are varying widely between companies and industries. Therefore, to measure audit size and client firms sizes, many researchers choose the total assets as variable. To consistent with previous studies, Ashbaugh, LaFond and Mayhew (2003); Choi, Kim and Zang (2006); and Hoitash, Markelevich and Barragato (2007) use the nature log of total assets to control client firms sizes and audit size. In addition to using total assets and turnover as proxies to audit size, on most investigations, likes Ashbaugh et al (2003) choose the number of employees to quantize audit size. Both of these scholars use number of business segments and geographic areas in measuring audit sizes. As for the measurement of complexity of audit process which is another reason for increasing audit fees, Chan et al (1993) suggest to use the number of subsidiaries to measure it. According to previous studies (Ashbaugh et al ,2003; Hoitash et al ,2007), the proportion of foreign subsidiaries will have influence on the increase of audit fees, therefore, the ratio between foreign subsidiaries and total number of subsidiaries is selected to measure this effect on audit fees. Furthermore, Choi, Kim, Liu and Simunic (2008) use the ratio of the sum of inventories and receivables to total assets to present complexity. Lastly, the dummy of gain or loss before extraordinary items is a popular variable in latest studies, such as the study in Hoitash et al (2007). The level of risk in audit processing is another factor causes increase in audit fees. Turley and Cooper (1991) provide the hypothesis that there is a positive relation between audit risk and audit fees. Chan et al (1993) predict higher risk makes consequence in higher audit fees is because auditors want to take the excess fees than normal level as an insurance premium and this hypothesis is supported by interview findings. Most of previous studies focus on using such variables as liquidity ratio (the ratio between current liabilities and current assets), and gearing ratio (the leverage), to test the level of audit quality. However, as previous scholars point out that the audit risk which is the reflection of the nature of the business of the enterprise and the control of enterprise is difficult to measure. Therefore, the subjective judgments in measuring audit risk are hard to avoid. The level of client firms performances is will also has impact on audit fees. According to the interviews between audit partners (Chan, Ezzamel and Gwilliam, 1993), it is confirmed that there is a link between the level of client firms profitability and the level of audit fees, and the association between them is negative. Furthermore, it is commonly agreed that when a client is facing with financial pressure is more likely to ask for controlling overhead costs wich might be result in higher audit fees. To measure the level of this variable, Chan et al (2003) use the return on equity to measure it, while other researchers like Hoitash et al (2007) and Chan, Kim, Liu and Simunic (2008) use the return on assets to measure this. Beside variables above, there are other potential reasons which might also cause the changes in audit fees. However, seldom of previous studies pay attention on these potential variables (Chan, Ezammel and Gwilliam, 1993) according to the study finished by Chan et al (1993), the control of ownership is also one of the variables in audit fees model. The hypothesis in their paper makes the assumption that the extension of audit services will be a factor in the ownership control as companies with a diverse ownership structure are required a higher quality audit. Therefore, the audit fees are increased. However, it is difficult to measure the extension of ownership control directly. The timing variable is another reason in the fluctuation of audit fees (Chan et al, 1993). According to the audit season in UK market, the accounting year between 1 December and 31 March is the busy season, others are non-busy, and the former season will increases audit fees as auditors have a comparatively shorter deadline in it. Moreover, though test, authors find that the legal liability also have impact on the level of audit fees, as the evidences demonstrate that legal liability is a fee-increase factor. Lastly, other variables, such as the location of auditors, are seldom be used as variables in investigations. 4.2 Review of the development of discretionary ac

Friday, January 17, 2020

Globalization and Its Impact on Bangladesh Economy

Assignment On â€Å"Globalization and its Impact on Bangladesh Economy† (ECO 360, Section: 1) Assignment on â€Å"Globalization and its impact on Bangladesh Economy†. Subject: ECO 360 (Socio-Economics Profile of Bangladesh) Section: 1 Submitted To: Muhammad Mahboob Ali Adjunct Faculty, Department of Economics, East West University. Submitted By: Name| ID| | | | | | | Acknowledgement In the preparation and finish this assignment, we acknowledge the encouragement and assistance given by a number of people and institution.We would like to express our gratitude to our faculty at East West University; Mahboob Ali for providing us detailed feedback and advice on this assignment. He always gave us his suggestions in making this study as flawless as possible. We also like to thank our group members for co-operating me in many troublesome tasks. And never the less above all our heartiest thanks goes to all mighty Allah without his help. We would not be here. Letter of Transmitta l Date: 23th November, 2012 Muhammad Mahboob Ali Department of Economics, East West University Subject: Submission of Assignment. Sir, It’s our great pleasure to submit the assignment.A study was making on a economics sector that you have asked us to prepare and we select â€Å"globalization impact on Bangladesh economy† to study. We have tried our best to follow the instruction that was given by you. Throughout this study we tried to identify whether globalization play positive or negative impact on our country’s economy. As well as, we also discuss the overall condition of our country’s economy also. We sincerely hope that you will enjoy this report as we enjoyed while writing it. If you need any further clarification or quarry in interpreting this analysis, we will be glad to oblige you.Thank you. Abstract: Over the past decades, globalization has now become a new world order, new world order, which virtually influences everything that comes in our min d. Developing countries like Bangladesh with vulnerable geopolitical locations and weak economies are now looking at globalization to strengthen their economy to fight any perceived threats. But the increasing role played by the western dominated institutions such as, the World Bank (WB), International Monetary Fund (IMF), and the World Trade Organization (WTO) in setting the rules under which globalization is played, has placed developing ountries in a much disadvantageous position vis-a-vis the developed countries. However, a closer look at the globalization will show that it has both positive and negative impacts on the economy of Bangladesh. A thorough understanding of the effect of globalization is needed to use its advantages to improve her economy. This may also help Bangladesh maintain a sustained growth in the face of likely economic peril. This paper studies both negative and positive impacts of globalization on some selected economic sectors of Bangladesh.It also studies some ameliorative measures to overcome the negative impacts and also the ways to exploit the opportunities created. Finally the paper recommends some measures for Bangladesh to meet the challenges of economic globalization. Table of Contents No. | Topic| Page| 1. | Introductiona) Generalb) Motivation and Significance of the Researchc) Research Questions| 7 – 8| 2. | Literature Reviewa) Globalization as a phenomenon. b) The positive impact of globalization. c) The negative impact of globalization. | 9 – 12| 3. | Objective of the Study| 13| 4. | Methodology| 14| . | Limitation of the Research| 14 | 6. | Analysisa) Overall Economic Condition of Bangladesh. b) Opportunities of Globalizationc) Challenges of Globalization| 15 – 25| 7. | Recommendations| 26| 8. | Conclusion| 27| 1. Introduction Globalization in the broadest sense implies integration of economies and societies across the globe through the flow of technology, trade and capital. It basically refers to a p rocess that enables people, goods, information, norms, practices and institutions to transcend national jurisdictions through markets, technologies, interests and information flows.Four types of changes characterize globalization. First, it involves a stretching of social, political and economic activities across frontiers, regions and continents. Second, it is marked by the growing magnitude of interconnectedness and flows of trade, investment, finance, migration, culture, etc. Third, it can be linked to a speeding up of global interactions and processes. And fourth, the effects of distant events can be highly significant elsewhere and specific local developments can have considerable global consequences.Thus the boundaries between domestic matters and global affairs become increasingly fluid. Globalization, in short, can be thought of as the widening, intensifying and growing impact of worldwide interconnectedness. It causes an expansion in the volume and variety of cross border t ransactions in goods and services. Globalization is a much used term and there are diverse views as to how and why globalization is occurring this time around. The late 19th and early 20th centuries saw a globalization in economic markets, but we can see its pervasive and widespread impacts at the present time.Every country in this world enters into global economy and trying to cope with the pace of global economy. Bangladesh is one of the developing countries in the world and its economy has already being impacted by global economy. It is not possible for a third world country like Bangladesh to keep pace with global economy, because it is conceivable that the origins of globalization lie in the political decision by merely the developed countries of the world. Bangladesh’ economy experiences a recession of industrial growth.The study is focused that there is strong opportunity for Bangladesh to boost its economy, but the socio-political situation should be favorable one to enhance savings and investment in this country. The study articulates some strong recommendations that could make Bangladesh even stronger to boost to compete globally to a greater magnitude. It is conceivable that Bangladesh needs to privatize its State- owned enterprise (SOEs) and should maintain an unassailable relation with World Bank, IMF and other donor agencies. It is a big challenge for Bangladesh to contend in global economy through considerable internal and external obstructions.The entire paper is arranged by giving a brief current economic condition of Bangladesh followed by an introduction initially; after then the next section is discussed how Bangladesh economy impacted through regional trade agreement and later the paper portrays the role of privatization in Bangladesh economy. And this paper also discusses how Globalization affects the whole economy of our country Bangladesh. Later the paper discusses some constraints of Bangladesh economy and then it illustrates so me basic recommendations that could make this economy stronger to compete with global economy.And at last a conclusion is illustrated that reflects the overall theme of this paper. It would be very difficult to keep pace with modern globalization. Therefore, one of the greatest challenges faced by Bangladesh in this century is how to strengthen its participation in the global economy in a manner that will bring widespread and sustainable benefits to its people. Motivation and Significance of the Research The motivation that we have for this research is based on the fact that we are Bangladeshi who have seen and experienced the impact of globalization phenomenon on economic development.Developed countries use globalization for improving their economy in many ways. We have marked how these countries use globalization to their advantage. Having compared the socio-political and economic environment of Bangladesh and the countries we have researched, we are now in a position to understan d the likely effects of globalization on Bangladesh economy. We would like to take this opportunity to do the research based on our experience and understanding of the subject from our reading. Research Questions The primary question of this term-paper is: What is the overall impact of Globalization in Bangladesh economy?What should Bangladesh do to use the advantages of globalization in improving her situation? 2. Literature Review Many books and articles have discussed the various effects of globalization exhaustively. These studies include globalization as a phenomenon in general and the positive and the negative impacts of globalization in particular. Even though many books and articles have addressed globalization from the developing countries point of view, few even mention its impact specifically on Bangladesh. Globalization is a growing concern and it is perceived as a vast subject that can impact all aspects of the world, or a nation.People blame globalization for affecting everything from culture, to political systems, to religious institutions, and the economy; all of these perceived impacts of globalization would impact Bangladesh differently. It is important to determine how exactly it can impact Bangladesh. This paper will concentrate on finding viable options for Bangladesh to sustain the world of global economy. The paper will also focus on the measures that Bangladesh might consider in using the effects of globalization in its economic growth. The literature generally looks at globalization from three different angles.These are: a) Globalization as a phenomenon. b) The positive impact of globalization. c) The negative impact of globalization. a) Globalization as a Phenomenon Historical Foundation: The origin of the concept of globalization stretches far back to the activities of the early Mediterranean civilizations before the fifth century A. D. 1 The ancient explorers, motivated primarily by the prospects of material gain, traversed the â₠¬Å"silk route† between China and Europe, the â€Å"amber route† from the Baltic to the Mediterranean and the â€Å"spice route† by sea between Egypt, the Yemen and India.During this period, up to the end of the fifteenth century, the volume of long distance trade, travel, and communications was inevitably irregular. 2 Increased trading expeditions by British, Dutch, and Portuguese merchants in the seventeenth century raised the demand for colonial goods such as coffee, tea, sugar, tobacco, and chocolate. The requirement for more production of these goods as the demand increased prompted the beginning of slave trade from Africa to the Americas and Europe. Following these expeditions, European languages were easily transplanted to other continents and the three monotheistic religions namely Islam, Christianity and Judaism took root. In the nineteenth century, the technology revolution in transport and communications including the emergence of the railway, the teleg raph and the steam ship all lowered freight rates and raised incomes therefore further boosting globalization. Core Elements of Globalization: Basically, globalization rests on a tripod namely, the expansion of markets economic), challenges to the state and institutions (political), and the rise of new social and political movements (cultural). 8 economically, technological changes and government deregulation have permitted the establishment of transnational network in production, trade, and finance creating what is referred to as a â€Å"borderless world†. The second element affects States. Political power and activities extend across the boundaries of nation- states while policy making on issues such as human rights, environmental degradation and nuclear safety have required global consensus.The third element of globalization affects more than markets and states. It is altering the lives of people across the globe. Fast dissemination of media, books, music, international id eas and values has produced a somewhat global culture. b) Positive impacts of globalization: A thorough understanding of the effect of globalization is needed to use its advantages to improve the economy of Bangladesh. This may also help Bangladesh maintain a sustained growth in the face of likely economic peril.Though some view NGO (Non-Government Organization) as a tool of economic exploitation, it brings changes on the living condition and status of the poor and rural people. Excludes are now becoming Includes. While most low-income countries depend largely on the export of primary commodities, Bangladesh has made the transition from being primarily a jute-exporting country to a garment-exporting one. This transition has been dictated by the country's resource endowment, characterized by extreme land scarcity and a very high population density, making economic growth dependent on the export of labor-intensive manufactures.A greater integration with the global economy seems to fit well with Bangladesh's development efforts. The garment sector opens the door of sufficiency to the people who previously live in a hurdle living. The export-oriented garment industry presently employs around 2. 5 million workers – mostly women from low-income, rural backgrounds. The second dominant export-oriented activity, shrimp farming, is also very labor intensive, presently employing nearly half a million rural poor. This economic revaluation is not only creates skilled sectors but also gradually decreased unemployment problem.More generally, import liberalization is likely to have contributed to the creation of productive employment for the poor through the strengthening of many small-scale and informal sector activities that have benefited from improved access to imported inputs. Another issue of great importance to Bangladesh is that the free movement of migrant workers across borders be expanded, for workers' remittances play an important role in its economy. Moreo ver, as a result of increasing global connection and technological improvements diversification of export is possible as many new export items are added as the global demands are increasing.We can talk about ship building industry and IT based call center service are now coming as a new dimension in our economic arena. Globalization also creates impact on our culture and social structure as we are now considering ourselves as a global citizen. The interaction with other cultures and knowledge and information about other societies create a great impact on our lifestyle and thinking. c) Negative impacts of globalization: The removal of the Multi-Fiber Arrangements (MFA) quotas now threatens to increase competition in the global garment industry and thus limit Bangladesh's growth.The strength of the industry depends on the export quotas dictated by the MFA and preferential access in the major Western markets. Moreover, other export industries are unlikely to take its place if the garme nt industry shrinks. It is not easy for a Least Developed Country (LDC) like Bangladesh to specialize in manufactured exports. Having low wage costs can hardly compensate for its lack of marketing skills and infrastructure and poor overall investment climate. Moreover, the high degree of dependence of domestic industries on imported raw materials and industrial inputs makes it difficult for Bangladesh.In this connection, it is likely to mention that, the Generalized System of Preferences (GSP) rules were devised decades ago to help developing countries promote export-oriented industrialization. But, in effect, the rules proved discriminatory against LDCs like Bangladesh that count on low value-addition processing activities. On top of these rules, Bangladesh also has to worry about non-tariff barriers such as those relating to environmental or labor standards. Anti-dumping actions are already under way against exports from Bangladesh,Also, the role of globalization played by the wes tern dominated institutions such as, the World Bank (WB), International Monetary Fund (IMF), Asian Development Bank (ADB) and the World Trade Organization (WTO). The agenda of the Bangladesh’s economical sector and upcoming debt formulated by these kinds of organizations are running on the process of economic exploitation of a country. For this, they are willing to give money for construct a road rather than a factory. Beside this for every debt they are selling their products in our country without any tax.Globalization is a well excepted term all over the world, but developed countries are the real beneficiaries of the concept; whereas the developing countries are in a confused situation to relate the term on their economic, social, political and personal life and it cannot helps to reduce the gap between haves and have not. 3. Objective of the Study: The overall objective of the project is to expand the theoretical discussion on the relationship between globalization, envi ronmental change, resource use social suffering and human security in the context of a least developed country-Bangladesh.And the primary objective is to analysis how globalization effect on country’s economy. This study will: †¢ investigate the role environmental change play in social conflicts and resultant social suffering; †¢ assess the role of population movement as a factor of environmental degradation; †¢ Critically assess the gender dimension of social change resulting from the interacting forces of globalization and environmental change. The principal objective of this study was to identify all major dimensions and issues of †¢ Globalization and attempt to explain those, to the extent possible, from industrial perspective.The specific objectives set were as follows: †¢ To assess the effect and impact of the process of globalization on the life and livelihood of industry especially in Bangladesh. †¢ To analyze the overall economic conditi on of Bangladesh. †¢ To find the opportunities and challenges of Globalization in the context of Bangladesh economy. 4. Methodology: We used descriptive and expletory design to prepare our assignment. By design, this study was an exploratory type of study. For our primary research, we mostly used the resources of the web and the library.And some standard reference sources like – †¢Daily Newspaper †¢Weekly Newspaper †¢Magazine †¢ Economic Reports based on Bangladesh Economy For finding materials in the web, we used the standard search engines such as †¢Google †¢Yahoo †¢AltaVista As well as reference sites and news sites, we also used some Bangladeshi search engines. 5. Limitation of the Problem : All data are not available in internet. It was very short time to collect all relevant data and to prepare this assignment. Also we faced load shedding problem and our lab was over crowded that distract our mind sometimes. . Analysis a) Overall Economic Condition of Bangladesh: Bangladesh is one of the poorest countries in the world, but it is plausible that the overall growth rate of Bangladesh is not stagnant; the overall growth rate of Bangladesh is actually moving forward. The growth average of Bangladesh is 5. 4%per year over the FY01-05 period, which has been the highest since the country’s independence (The World Bank). Bangladesh has global merchandize trade relationship ships with many countries around the world.Bangladesh has a good market in the United States, United Kingdom, Australia and Germany. Bangladesh also exports goods and services from around the globe. The economy of Bangladesh is a rapidly developing market-based economy. Its per capita income in 2010 was est. US$1,700 (adjusted by purchasing power parity). According to the International Monetary Fund, Bangladesh ranked as the 43rd largest economy in the world in 2010 in PPP terms and 57th largest in nominal terms, among the Next Eleven or N-1 1 of Goldman Sachs and D-8 economies, with a gross domestic product of US$269. billion in PPP terms and US$104. 9 billion in nominal terms. The economy has grown at the rate of 6-7% per annum over the past few years. More than half of the GDP is generated by the service sector; while nearly half of Bangladeshis are employed in the agriculture sector. Other goods produced are textiles, jute, fish, vegetables, fruit, leather and leather goods, ceramics, ready-made goods. Garments sector is the largest exporting sector for Bangladesh. For Bangladesh, openness to trade would be a vital basis of future growth.Growth from trade directness will depend upon simultaneous investment climate reforms that would boost competitiveness to domestic firms. In Bangladesh the government should undertake policies to attract overseas remittance into productive investment activities. Remittances from Bangladeshis working overseas, mainly in the Middle East, are the major source of foreign exchange earnin gs; exports of garments and textiles are the other main sources of foreign exchange earnings. Ship building and cane cultivation have become a major force of growth.GDP's rapid growth due to sound financial control and regulations has also contributed to its growth; however, foreign direct investment is yet to rise significantly. Bangladesh has made major strides in its human development. The land is devoted mainly to rice and jute cultivation as well as fruits and other produce, although wheat production has increased in recent years; the country is largely self-sufficient in rice production. Bangladesh's growth of its agricultural industries is due to its fertile deltaic land that depends on its six seasons and multiple harvests.Transportation, communication, water distribution, and energy infrastructure are rapidly developing. Bangladesh is limited in its reserves of oil, but recently there has been huge development in gas and coal mining. Bangladesh’s economy has been rem arkably resilient, with GDP growth averaging 5? % a year for the past 15 years. But the growth has been off a low base, so the country remains one of the poorest in Asia. Its economic base is narrow (based around garments and agriculture) and vulnerable to natural disasters. Moreover, despite a recent period of relative calm, political stability is far from assured.Bangladesh is below the regional average for per capita income, growth and creditworthiness. The business climate can be difficult – but according to the World Bank’s Doing Business Survey no worse than the regional average. Like most developing economies, Bangladesh can be a risky place to do business. But it does have attractions: a large and growing population; steady GDP growth; and strong demand for foreign capital to meet the country’s large infrastructure and energy needs. Chart 2 shows the different criteria of risks to exporters and investors of Bangladesh.Over the past 15 years, growth has b een rapid and has slowly accelerated. Over 2012-14, the IMF expects growth to be over 6% pa, an impressive performance in the current economic climate. However, this partly reflects strong population growth, with per-capita income growth continuing to lag the regional average. Moreover, inflation remains a problem, with prices recently being boosted by reductions to fuel subsidies and a weakening in the currency. Inflation is also very exposed to swings in food prices, which account for 60% of consumption. ) Opportunities of Globalization: Bangladesh has a low human capital stock and is relatively closed to the global economy even by standard of the other low-income countries. Therefore, Bangladesh has not yet fully become part of the global economy. This is as truer in trade as in technology achievements. Globalize offers the potential to free Bangladesh and other developing countries from the restrictions imposed by a relatively small domestic market, low saving and limited access to world technology and credit. 1. Opportunity to break the vicious circle:It offers an opportunity to break the vicious circle of savings and investments, a long-standing important challenge for all developing countries. Better education, training, technology, equipment and infrastructure in general raise living standard. Due to globalization, foreign investment in our country will increase. If we can properly utilize it then employment will increased which will raise the income of people of Bangladesh. So, if there is a high rate of income then savings of people will increased which will enable us to break the vicious circle. 2. Alternative source of domestic investment finance:Globalization offers an alternative source of domestic investment finance. Such financing is channeled through direct investment and frequently come with attached benefits, such as technology transfer, training, marketing networks and managerial and technical expertise. Foreign investment is especially att ractive when it brings its own physical capital and the means to enhance human capital of domestic citizens. 3. Increasing the living standards of poor people and employment opportunities: Globalization is increasing the living standards of poor people in Bangladesh.Industries from foreign investments create employment opportunities for a large number of people including young women who, for the first time, can visibly enter the male dominated public space. Foreign and export oriented industries are changing the economic and social scenario of Bangladesh which, results in an increase of living standards. 4. Motivating the people and increasing the modernity of our society: Increasing globalization is motivating the Bangladeshi people and increasing the modernity in our society. A person can forces by inspiration refers what effect his direction, intensity, and persistence of voluntary behavior.Foreign investments create high paying jobs, which require more knowledge and skill, there fore motivating people to work for a higher education. Bangladeshi students are performing better than before. Advertisements for foreign products also motivate people. Globalization allows foreign companies to advertise their products in our country. When people watch advertisements for expensive foreign products, they want to buy them even if they don't have the ability. 5. The transfer of technology: Bangladesh has largely benefited from the transfer of technology.One nation cannot produce everything, because it has limited resources. Globalization gave us the opportunity to use modern technology. We got world-class telecommunication technology, which was not possible without foreign investment. 6. Modern telecommunication technology: Modern telecommunication technology connected us to the rest of the world. Bangladesh are getting technological advantages like computers and the Internet, transportation and online banking with evaluation in the modern world. We are earning foreign currency and creating many new jobs by exporting computer software.Globalization has made a big social and economic change in Bangladesh. 7. Increased competitiveness and raise export potentials: Product market competition induced by government policy of economic liberalization can bring about increased competitiveness and raise export potentials. The competition can be enhanced by reductions in transport and communication costs of conducting international trade, by removal of external tariff barriers, and by more vigorous application of pro-competitive policies in those domestic industries not exposed to international competition. Competition is healthy for the economy in the long run.It not only influences the relative bargaining power of firms and workers but it is also a force for renewal and change. 8. Actions of Employers to reap the opportunities of Globalization: Volatility in the labor market has prompted employers in Bangladesh to become more organized and to move towards greater unity. There is a tendency among the employers to shift certain risks and responsibilities away from the enterprise or society to the workers. Employers have tended to introduce new labor-saving technologies to reduce cost of production and to avoid the risk of labor unrest.Unlike in the public sector, employers in the private sector have resorted to growing casualization of workers resulting in the deprivation of workers of provident fund, gratuity, normal working days and hours, group insurance, leave encashment, leave with pay and pension benefits and, above all, job security 9. Actions of Trade Unions to reap the opportunities of Globalization: Economic integration and increasing competition erode the bargaining power of trade unions. However, the increasing mobility of goods and capital allows such obstacles to be readily circumvented, thereby prompting the trade union movement to adopt a global approach.Globalization has also created opportunities for trade unions by offering organized labour the alternative of collaborating with employers to enhance productivity, adaptability and product or service quality, in exchange for job security and higher wages. 10. Benefit from return migrants: Because of globalization also Bangladesh can benefit from return migrants. Migrants make-up a pool of potential investors and managers who have benefited from foreign training, not merely from academic or vocational training but in the wider sense of learning on the job and assimilating more of the global business culture .Migrants are likely to return for changing lifestyle for example they wish to return home to set up a business (however small) or to take advantage of early retirement. Due to globalization these migrants are interested to invest in Bangladesh 11. Foreign Direct Investment: FDI in RMG industry should be welcomed and pursued to ensure higher investment in this sector. FDI would also help in transferring technology and ensure bigger market acces s by providing direct linkages with the retailers. 12. Some other Opportunities of Globalization: Globalization has also created some new scope and opportunity for the development.Following may be considered as opportunities: a) Bangladesh is being integrated with global economy and business. b) Expanded private sector employment opportunity with poor labor rights.. c) Increasing competitiveness and efficiency. d) Emergence of new sectors of production and employment according to the global need, such as ternary, footwear, pharmaceuticals, RMG, etc. e) Labor export to external market increased. f) As more countries are participating in trade, finance and production, Bangladesh is being integrated globally to a greater extent than before. g) Increased economic interdependence compared to other developing nations. ) Bangladesh is being linked to both developed and developing countries more closely through economic institutions, international agreements or treaties. i) Increase in fore ign capital, information and technology flows. j) Bangladesh is facing competition from increased internationalization of foreign enterprises, mergers and alliances. k) Bangladesh is experiencing customer-driven (rather than product-driven) global and local markets, though at the same time segmented markets. l) Competitiveness of Bangladesh is increasingly being based not on low wages or natural resources but on knowledge/innovation, skills and productivity. ) Potential to boost productivity and living standards across the globe, because a globally integrated economy can lead to a better division of labor between countries, allowing low-wage countries like Bangladesh to specialize in labor-intensive tasks while high-wage countries use workers in more productive ways thus allowing global firms to exploit bigger economies of scale. So we think Globalization will help Bangladesh a lot to increase its overall economic condition and others sectors that need to be strong to build up a dec ent economy. c) Challenges of Globalization:Within a country, there is the challenge of forgoing liberalization policies that promote greater integration of the domestic economy into the global economy. There are pressures from trade unions, lobby groups and local businesses over the effect of these policies on jobs and the closure of local industries. These can make it politically and socially difficult to implement reforms that could benefit a country in the medium to long term. The responsibility for achieving the right balance and pace of adjustment lie with individual Governments, but in practice this is not simple as it appears.Bangladesh pursued a number a number of stabilization and structural reform programs between 1987 and 1993, and made considerable progress in achieving macroeconomic stability. The various challenges of globalization that Bangladesh faces are as follows:- 1. Challenges for national economy: During the period of rapid integration with the global economy, the incidence of poverty appeared to have increased and so have inequalities in the country. Economic reforms in the country produced disappointing results in the absence of a system to induce entrepreneurs to invest in industries.Lack of institutions to make the economy efficient and reduce transaction costs was also a reason behind the country's poor performance. Inequalities increased in the country during the period of rapid globalization. Inequality in income distribution increased quite substantially both in rural and urban Bangladesh. 2. Challenges for our culture and social life: Globalization makes worldwide boundaries fade away and enlarging contest in the market place. For globalization we are facing a huge impact on our culture and social life in the modern world. For example, McDonalds introduced American fast food to other parts of the world.The American fast food of McDonalds, Pizza Hut, etc. are introducing to our country, which is a challenge for our Bengali fast f ood. Also the Indian culture becomes a major challenge for our own Bengali culture now-a-days. 3. Challenges for business: As in the case of industries, globalization impinges heavily on the business in Bangladesh with destabilizing forces debilitating balance of trade and balance of payments. Bangladeshi products are increasingly losing competitiveness in the global market due to growing cost of business exacting high prices.The cost of business is increasing primarily due to port problems, bureaucratic tangles in customs department and no improvement in lead-time. In contrast, an increasing number of countries are offering low-cost products. 4. Challenges of Globalization on Industry: In Bangladesh many industrial units in jute, cotton, RMG, and paper and several other sectors are closed down by a number of reasons of which globalization is one crucial factor. These industrial units have difficulties to compete both domestically and internationally.Even in the domestic market, it is difficult for them to keep up the competitive advantages compared to imported goods. Notably, in all these sectors there is considerable inflow of FDI and presence of MNCs (multinational companies) and there is no SOE. 5. Challenges faced by ICT and Bio-technology: Such challenges faced by Bangladesh for the ICT and Bio-technology and their Impact on Employment and Intellectual Property Rights are: a) Makes some of the traditional farming role of people redundant leading to unemployment particularly among older and rural people. ) It's not a desires and traditions of our communities to imported bio-technologies always. c) Needs to make easy to codify and move some of the un-codified knowledge of local citizens to the worldwide market. However if uncompensated, the move deprives people the economic gains and royalty they should be entitled to. 6. Challenges for Power Sector: Government has opened up foreign investment in power generation as independent power producer (IPP), and ha s also privatized transmission and distribution to the private sector (DESA, DESCO). Significant private foreign capital invested in the sector.As a result Bangladesh Power Development Board gradually has been losing its control over the power sector. Companies appointed employees under new terms and conditions. Job security of the employees also was ensured by the agreement 7. Challenges for Telecommunication: Telecommunication service was exclusively under Bangladesh Telephone and Telegraph Board (BTTB). This sector has been opened up for private investment. Different private telephone companies, TV channels, marine and rural telecommunication, radio trucking service and revering telecommunication have already been opened up for private sector.These private phone companies or TV channels are capturing a large number of customers. As a result govt. owned companies losing their customers. Government has been making different efforts to privatize this sector like PDB under company ma nagement. There is strong opposition from employees against privatization of BTTB. 8. Challenges for Labor Market: In Bangladesh many industrial units jute, cotton, paper and RMG, and several other sectors were closed down by a number of reasons of which globalization is one of crucial factor.It is estimated that near about 7 thousand big and medium size industries closed down as an impact of globalization. In Bangladesh near about 2 million people lost their employment due to closure of industries. Most of the privatization and closure of industries resulted in huge retrenchment. Fall in the aggregate demand for labor has accelerated declination of wage. Real wage declined due inflation and currency market deregulation. Also there is a decreased in number of working people under permanent contracts of employment.Non-traditional forms of employment including part time, casual and contract labor, home-work and migratory work increased. Casualization of workers in the private sector r esulted in deprivation of provident fund, gratuity, normal working days and hours, group insurance, leave, pension and above all job security. Numerical functional flexibility in labor market increased, increased of out sourcing of work, and increased irregular payment. In the name of competition workers are forced to work overtime. Minimum wages of the workers in the private sector are not protected. 9. Challenges for Employment:Challenges for employment are as follows:- a) Trade liberalization and privatization created social insecurity and aggravating, unemployment, underemployment. b) Social security of the workers decreased. c) Reduced job security, workers are terminated without benefits. d) Working environment degraded, especially in the private and informal sector. e) Labor laws are not implemented in most of the privately owned industries. 10. Mutual dependence: Globalization has increased mutual dependence between macroeconomic stability and good institutions and organizat ions, and made stability vulnerable to volatility in financial markets.Financial and currency crises around the world have occurred with an acceleration pace and with relatively more devastating impacts since the globalization process accelerated from 1989. 11. Some other Challenges: Bangladesh has to face some challenges to fight as well as cope with globalization. Challenges are as follows: a) Build up strong resistance against privation. b) Reopening of closed industries. c) Unite trade union movement to achieve greater collective bargaining power. d) Capacitate trade union with new bargaining approach. ) To fight against the fast changing rules of the game of rapid transformation workers need to develop knowledge based skill in manufacturing through continuous updating of skill to face the challenges of globalization. f) Build up global shared goal and action. Enhance global unionism to face the global challenges. g) Initiatives to influence International Financial Institution t o ensure workers’ rights. h) Build up pact between trade union and global consumers. Make global consumers responsible to ensure labor rights at national level. i) Organize informal sector as well non-unionized workers to strengthen trade union movement. ) Globalization not only affected workers but also affected different sections of the people, so it is important to organize voice from all sections. k) Workers alone would not be able to fight globalization. Influence political parties to incorporate the agenda. Globalization has both positive as well as negative impacts on its players. In an increasingly open, integrated and borderless world there have been remarkable growths in trade and exchanges. It was basically possible because of the democratization of technology, finance and communications. On the other hand globalization also generates number of problems. 7.Recommendations: The impact of globalization on the economy of Bangladesh is mixed with marginal positive outc ome overshadowed by vast negative results. Globalization provides many opportunities for development for Bangladesh and its people, including the potential to improve wages and living standards. It has challenged many economic strategies of the past as the way towards development. It provides an impetus and incentive to develop human resources and to improve productivity as key factors of competitiveness and improved living standards. Globalization has made Bangladesh conscious of the need to improve productivity.Even unions in Bangladesh have come to acknowledge the importance of productivity enhancement to the standards of living of their own members. > Trade liberalization and privatization has created social insecurity in terms of loss of jobs and aggravating unemployment and underemployment in the country pointing to the need for social protection to contain insecurity of the workers. Voice of the common workers, collective awareness and participatory management of trade unions at various levels are the three main processes for the improvement of trade union governance.The existing practice of centralized governance of trade unions has largely contributed to the major failures in the labor processes in Bangladesh. > Competitive labor market is expected to link wages with productivity. In the case of SOEs, real wage growth outpacing productivity growth is a factor raising unit labor costs and reducing international competitiveness calling for adjustment of real wages in line with productivity growth. > The state thus has a critical role to play; both in handling such shocks and in helping people and firms seize the opportunities of the global market place.Globalization also sharpens the need for international co-operation in at least five areas, such as: a) Managing Regional Crisis, b) Promoting global economic stability, c) Protecting the Environment, d) Fostering Basic Research and the dissemination of know-how and e) Making International Development Ass istance more effective. Some Recommendations are given below: Government level reforms: Bangladesh Government has taken initiatives or resources for telecommunications and transports which are not along to meet the nation’s growing requirements.Bangladesh government should continuously improve system capabilities to enhance the private sector participation. Monetary Policy: The central bank must maintain a close look on the growth of the monetary base or domestic credit creation. Attract free flow of FDI : Foreign Direct Investment is inevitable for any developing economy. Bangladesh should create proper field to attract more FDI in industrial sector. Productive investment: Bangladesh needs substantial quality investment in the industrial sector and investment in those activities where we can produce more efficiently.The economic growth rate in Bangladesh is not necessarily constrained by insufficient savings; rather it is due to poor level of investment and lack of efficient use of capita Integration into World Markets: In Bangladesh, firms can be internationally integrated by means of ownership or by selling their products in foreign markets. In the readymade garments and leather/footwear industries, most of the firms are majority exporters, i. e. , they sell more than 50% of their output in export markets. In contrast, in the pharmaceuticals industries there are no majority exporters (Fernandes2006).Limited foreign capital assimilation: Every year Bangladesh seeks foreign capital for undertaking various projects. But foreign capital can be a substitute for domestic savings only to limited extent. Foreign aid, commercial borrowing and portfolio investment can limit the expansion of savings by expanding consumption. The government should immediately constitute a national committee on aid for trade to work on getting a better share of the aid-cake as well as adopt a foreign aid policy statement in consistent with the new PRSP (Poverty Reduction Strategy Paper) to make donors clear about the priority areas of aid. . Conclusion: Globalization has a very far-reaching effect on almost every sphere of life. In the question of economic development and growth it is even more being in this era of globalization. Developing country like Bangladesh must take the advantages of globalization and attempt to improve her economy. However, we found from each piece was that the impact of globalization was more negative on Bangladesh than it was positive.Globalization has not only kept Bangladesh from advancing ahead in economic development, but it has changed the traditions and ways of life for the indigenous people for the worse. As a poor country, Bangladesh needs to be more concerned about the appropriate implementation of Globalization. As we find thru our research, Bangladesh’s potentials to economic globalization is highly promising. We believe that the recommendation made in this paper if implemented well will take Bangladesh to a poi nt of sustained economic growth and development.

Wednesday, January 1, 2020

The Ethical Conduct Of The Physician Assistant - 1308 Words

There’s also non-maleficence, which basically means, ‘Do no harm’. The physician assistant must aim at producing a net benefit over harm. 6 If Sally decides not to treat the abusive patient, which is simply abandoning the patient, then she is doing harm. Ignoring the patient’s needs is an act of negligence, which will probably cause the patient’s condition to worsen. Sally must act accordingly with the Deontological view 7, which requires her to do her duty as a medical provider to treat the patient no matter what he does. This requires Sally to show the virtue of compassion as she is trying to provide care even to the most abusive, noncompliant, dishonest patients. This act will also satisfy some of the competencies a physician assistant must uphold: Commitment, dedication and self-regulation. The Ethical Conduct for the Physician Assistant Profession also states â€Å"In the absence of a preexisting patient–PA relationship, the physician as sistant is under no ethical obligation to care for a person unless no other provider is available. A PA is morally bound to provide care in emergency situations and to arrange proper follow-up.†1 (pg5) So these are not just her legal duties, but they’re her moral duties as well. In the beginning, by not responding to the abusive demands of the 51 year-old male and continuing to assess and treat her other patients, Sally was being ‘just’ towards them, which is the last bioethical principle. But Sally must also be ‘just’Show MoreRelatedCode Of Ethics And Ethics895 Words   |  4 Pages A code of ethics is a guide of principles designed to help professionals conduct business honestly and with integrity.1Most organization have codes of ethics that its members are required to follow and it lays out the rules and acceptable behavior of its the members on ethics and which actions are acceptable or not acceptable business practices. One industry where professional codes of ethics are important is health care. Most health care workers belong to an accredited organization of their professionRead MoreThe Importance Of The Physician s Code Of Ethics963 Words   |  4 Pagesdilemmas, a solution is imperative for the physician or physician assistant. In these cases, the importance of the physician’s code of ethics also comes into importance when establishing a sense of the ethics involved. Ethics is the branch of philosophy that seeks to understand the nature, purposes, justification, and founding principles of moral rules and the systems they comprise. Ethics is essen tial in dealing with the values relating to human conduct and also focuses on the rightness and wrongnessRead MoreThe Codes Of Conduct Are Guidelines And Procedures1347 Words   |  6 Pagescodes of conduct are guidelines and procedures that are based on personal conduct and they all are vital for each worker in the establishment. These conducts are implemented, so that workers can adhere to the highest standards of care while utilizing ethical approaches and codes of conduct, amounts to the foundations of Long-term care facilities based on principles. It is the responsibility of such parties that include upper levels of management to the lowest levels to avoid such conduct that goesRead MoreMy Personal And Professional Ethics Essay1087 Words   |  5 Pages As I enter my junior year in college I can see my career right ahead of me. I am attending Grand Valley State University to become a Physician Assistant. This makes me think about my involvement in people s health. This also makes me think about the responsibilities I have my patients and their well being. To be prepared for all of the challenges I will need to focus my attention on biomedical ethics. There are morals that have been engrained into my character. These include what is right or wrongRead MoreLegal/Ethical Boundaries Essay865 Words   |  4 PagesLegal/Ethical Boundaries of a Medical Assistant AAMA Medical Assistant Code of Ethics The Code of Ethics is a set of principles of moral and ethical conduct as they relate to the medical profession. There are five sections of the Code of Ethics. â€Å"Render services with full respect for the dignity of humanity.† A medical assistant will perform job duties with respect to the patient, life and rights as a human being. Holding the medical assistant to a higher standard, where he/she does not performRead MoreThe Physician-Patient Relationship1286 Words   |  6 PagesThe Physician-Patient Relationship Tahira Duncan Drexel University Abstract Sexual contact that occurs concurrent with the patient-physician relationship is considered to be sexual misconduct. The Hippocratic Oath prohibits such relationships. The Oath is deeply rooted in first do no harm. By violating beyond the boundaries in a patient-physician relationship it cause harm to the patient. Boundaries: The limits of appropriate behavior by a professional toward his/her client. Transference:Read MoreThe Health Care Delivery System Essay1141 Words   |  5 Pagesany concerns they have to their supervisors, physicians or the department who can help solve the situation. In the health care delivery process, â€Å"Advocacy means that the nurse is active in respecting the patient and patient rights and in ensuring that the patient has the education to understand treatment and care needs† (Finkelman and Kenner, 2016, p. 287). In the case study, the nurse did the right thing by showing concern to the physician assistant and moving up the ladder by contacting the hospital’sRead MoreThe Ethics And Values Of Healthcare912 Words   |  4 Pagesfrom my medical assistant background is that sometimes healthcare can have the hardest ethical questions around for example the major question you think of is a heart transplant who do you give the heart to a child patient or an adult patient? Healthcare executives make the hardest decisions based on ethics even worse than judges because healthcare can mean life or death. Principles of medical ethics are as followed, â€Å"The medical profession has long subscribed to a body of ethical statements developedRead MoreRole Transition and Professional Nursing1569 Words   |  7 Pagescorrectional facilities and dental offices. A licensed practical nurse may perform specific nursing skills and procedures under the supervision of an RN, Nurse Practitioner, Physician Assistant, Medical Doctor or Dentist. The licensed practical nurse may delegate to Certified Nurse Assistants or other non-licensed assistants. The LPNs scope of practice includes performance and documentation of basic patient care, vital signs, data collection on all body systems. The LPN carries out wound care ordersRead MoreEssay on RTT1 TASK1639 Words   |  3 Pagespatient/family/caregiver satisfaction as an NSI they may have reacted differently in the situation. According to the physician in the scenario, there have been multiple complaints by Jewish patients about the disregard for th eir dietary requests. Having this data and information available can aid in developing and educational session for hospital staff including dietary workers, nurses, and certified nursing assistants about the importance of respecting patient’s cultural requests. It is possible that some of the problems