German auto sales

Germany would be an ideal country to sell both the sedans and limousines in. However, the income is too high to make scooters a desirable product. Germany has a lot of paved roads and a large amount of drivers that would provide a good market for the sedans. Germany is also home to many CNN 500 companies and it his the home country of many millionaires and billionaires that could buy lots of limousines for personal and business use. Germany also has a good existing import infrastructure that is ready for the extra containers being brought in. They would most likely enter into the Port of Hamburg and then would be shipped via train to the destinations. As far as setting up the business, the rules and process in Germany would be very friendly to new businesses and there should not be much trouble. Germany is a good choice.

Reinventing the Bazaar

a) p.44 "Two kinds of market frictions arise from the uneven supply of information. There are search costs: the time, effort, and money spent learning what is available where for how much. And there are evaluation costs, arising from the difficulties buyers have in assessing quality. A successful market has mechanisms that hold down the costs of transacting that come from the dispersion of information."

-I really liked this passage, especially retrospectively because it gave a good summary of the main point of the readings. It takes a very general explanation of why the bazaars don't act to benefit the consumer without actually mentioning the bazaar.

b) Transaction costs refer the extra costs that can't be seen in the purchase price. Things like search costs and traveling costs that can't  be directly seen in the actual purchase price.

-You hear about a store 50 miles from home that's selling a t.v. for $150. Your local store that's one mile away sells the same t.v. for $175. You decide to take two hours off of work from your job where you make $15 an hour to get the distant t.v.. It costs you $10 in gasoline. So you have $40 in transaction costs to save $25, but those $40 are not seen in the cost of the t.v. because they are transaction costs.

c) Imperfect information will lead to prices that are different from from the equilibrium price. Uninformed sellers might not realize that customers are willing to pay $10 for something they sell at $5. It could also benefit them by allowing customers to buy their item for $5 while others sell it for $1. It could hurt customers in the same way, lack of information raises transaction costs for customers and it could cause them to overpay for goods because they don't know where the lowest prices are.

A Fez of the Heart

a) pg. 11
"Not that you would have guessed by the 1990s, when Pomegranate had traveled so far toward a European ideal, modern and liberal, that the old names had fallen away, such associations with the past no longer sustainable, terminally broken by the sheer weight of Naf-Naf and fried squit."

-I chose this passage because to me this was most representative of the reading. It concisely describes the transition experienced by Pomegranate, from traditional Muslim to modern European chic. You can tell just from this one sentence that the modern Pomegranate holds no similarity to the Pomegranate of the past and that alteration is due to new economic and cultural influx.

b)
-when tourists first began going to Pomegranate, people tended to let them stay in their homes for free because hospitality was just part of their way of life, but people soon realized that they could make money by charging the tourists for things and the tourists didn't mind paying. Thus the traditional hospitality made way for modern economic opportunity

-the residents of Pomegranate stoned people that dared wear bikinis inside town because that was against traditional Muslim rules, but when the residents realized the economic girth of these scantily-clad Europeans they became more than willing to accept the sight of their skin and even encourage it

-the restaurant host as forced to wear a fez because it was good for business. They were making a mockery of the old Turkish garb, despite its lack of legality, for the chance to increase their profit margin

c)
-The leading tourist destination in Germany is Berlin. People go to Berlin because it is the largest city in Germany and has been such an important site in German history and is still considered one of the nicest and most modern cities in the world.

-Another destination for tourists is the Auschwitz Concentration Camp, people tend to go there to honor those who were unjustly murdered there and to help remember what can happen if the wrong people are in power.

-Another major destination is Dresden. It is called the "Florence on the Elbe" due to its sheer beauty. It is widely considered to be the most beautiful city in Central Europe and that's despite being almost entirely destroyed during World War II.

German unemployment falls

http://www.seattlepi.com/business/article/German-unemployment-down-to-7-percent-3526574.php

German unemployment has reached its lowest April number in the past 20 years. It dropped .2% from the March figure of 7.2% to 7%. The German labor agency claims that the credit for this wonderful employment spike can be given to the traditional springtime job spurt and the overall strength of the German national economy. This unemployment rate means that there is now less than 3 million unemployed Germans. Germany has had the strongest economy in the Eurozone and has experienced economic growth in the past two years. The unemployment rate is an indicator of Germany's economic strength relative to the Eurozone, Germany's 7% compared to the Eurozone's 10.9%. The German labor agency has calculated that with the burgeoning German economy, unemployment levels will continue to fall.

Lowering unemployment can be very beneficial to a country's GDP. In the traditional GDP = Consumption + Investment + Gov't Spending + Exports - Imports, lower unemployment means that more people are collecting money and there will be increased levels of consumption which will drive up the GDP

Part II of Rivoli

a) The textile industry has had various locations throughout history. From Great Britain to the Far East, textiles have rewarded many different locations. The changes in locale of the textile industry show something about the global economy. Nothing is fixed. If it was, textiles would never have left the shops in England, there is always going to be someone willing to manufacture the same goods at a lower cost. That fact is enough to shift markets and manufacturing hot spots as with textiles, they went east for cheaper production costs.
b) Postive: Industrialization provides a source of income for many people. It is able to provide jobs. "In 1980, the industry's peak employment year, nearly 400,00 people were employed in Hong Kong's textile and apparel industries."
Negative: Industrialization can also take jobs away. As more and more countries become industrialized more and more people need jobs and recently industrialized nations are able to provide cheaper labor than established ones. Companies realize this and relocate to the cheaper countries taking jobs away from the established workers.
c) "Globalization's skeptics are quick to point out that even if the conditions in apparel factories are a step up from those on the farm, it does not follow that workers in developing countries should simply accept their fate, working day and night in poor conditions, for pitiful wages and with limited rights. While free trade advocates may wish to isolate the activists as an uniformed fringe element, research shows that most Americans have reservations about the slippery slope in the race to the bottom of the working conditions in overseas apparel factories." pg 120

-I thought this quote was interesting because it is a very sensitive issue in today's world. Yes the working conditions might be poor but are they still better off than they wold be without the jobs? It is a very difficult question to answer and the correct response might never be truly understood.

The World is Spiky

a) Richard Florida does not believe in the flat-world theory of globalization. He sees the world as spiky, filled with economic mountains and valleys.The largest and richest cities in the world, especially in the United States, account for the large majority of the world's economy. As human society continues, these "mountainous" cities continue to grow while the valleys they create continue to deepen. He sees globalization as a fact, just not in the flat manner that has become globally accepted.
b) The idea of a spiky world is almost identical to the Central Place Theory. Both involve people going to large population centers to do their business which is why larger cities would have higher mountains represented on Florida's maps.
c) My study abroad plans involve going to Bonn, Germany. Bonn would most likely be considered a regional metropolis. It has an international airport and a population of about 324,000 people. But it is also smaller than the nearby Cologne which would be considered a larger regional metropolis. The closest nearby national metropolis would be Berlin. Some smaller nearby cities are Aachen and Leverkusen.

Details of Germany

1. Water Transportation
1. The largest ocean port in Germany is the port in Wilhelmshaven. It is the only one that can handle the largest ocean tankers on the modern ocean.
2. The largest port overall in Germany is the port of Hamsburg which is located on the River Elbe. It is the second largest port in all of Europe. Other ports are also located in Bremen and Bremerhaven.
2. Land Transportation
1. Germany has 40,826 km of railroads within its borders. It has adopted the standard gauge for easier transport between neighboring countries.
2. For passenger transport, trains stop in almost every village regularly. They are also very reliable and are private companies with all shares being owned by the government.
3. Germany has 65 cars per 100 people and over 650,000 km of roads. Germans traveled 2 trillion km in their cars in 2005 which was by the most common method of travel.
3. Air transportation
1. The two major international airports in Germany are the Frankfurt International Airport and the Munich Airport and are major international hubs in Europe.
2. Some other major airports are Berlin Tegel, Berlin Shonefeld, Dusseldorf, Hamburg, Cologne-Bonn, Leipzig/Halle.