ECODEV

Economics and Its Nature PPT 1

Economics
● Study of how individuals and societies choose to allocate and use scarce resources to
satisfy unlimited wants.
● Embedded in the definition are four key words:
1. Choice
2. Resource Allocation
3. Scarcity
4. Unlimited Wants

Economics Involves:
● Examining how individuals, businesses, governments, and societies choose to use
scarce resources to satisfy their wants.
● Developing theories and economic laws that explain how economy work

2 Branches of Economics
● Microeconomics
- Concerned with the behavior of individual entities such as markets, firms and
households
● Macroeconomics
- Concerned with the overall behavior and performance of economy as whole

Scope of Microeconomics
➢ Buying decision
➢ Consumer’s satisfaction
➢ Buying and selling decisions of the firm
➢ Determination of prices and in markets
➢ Quantity, quality and variety of products
➢ Profits

Scope of Macroeconomics
➢ Economic growth
➢ Unemployment and inflation
➢ Aggregate demand and aggregate supply
➢ Economic policies - fiscal and monetary
➢ International trade - exports and imports
➢ Money supply

SCARCITY
● Exists because individuals want more than can provided
Wants
- Desires that can satisfied by consuming a good or service

Needs
- Things, such as food, clothing, and shelter, that are necessary for survival

*Necessities are few but our wants are endless

Good
➔ Intended to satisfy some wants or needs of a consumer and thus has economic utility

Good can be categorized as:

● Economic Good and Free Good
● Durable Good and Nondurable Good
● Intermediate good and Final Good
● Consumer Good and Capital Good

Services
➔ Intangible commodity
➔ Tasks that you pay other people to perform for you

Economic Activities
1. Production
- Process of transforming inputs into outputs
2. Distribution
- Output, income or wealth is distributed among individuals
3. Exchange
- Trading goods between buyers and sellers
4. Consumption
- Process of how goods and services are utilized

Economic Resources
● Factors of production or productive inputs
● What people use to produce goods and services
Examples:
❖ Land
- All natural resources
❖ Labor
- Physical and intellectual services of people
❖ Capital
- Use to produce other goods and services
❖ Entrepreneurship
- Human resource that combines these factors of production creatively
3 ECONOMIC QUESTIONS
1. What to produce?
2. How to produce?
3. For whom to produce?

Economic System
● Set of economic institutions that dominates a given economy

Classification of Economic System

1. Traditional Economy
- Society produces what best ensures its survival
2. Market Economy (‘laissez-faire’ french phrase of “to let do”
- Private ownership of resources and the use of a system of markets and prices to
coordinate and direct economic activities
3. Command Economy
- Characterized by public ownership of virtually all property resources
4. Mixed Economy
- Blend market system

Categories of Goods and Services

● Consumption Goods And Services
- Bought by individuals and used to provide personal employment
● Capital Goods
- bought by businesses to increase their productive resources
● Government Goods and Services
- Bought by government
● Export Goods and Services
- Produces in one country and sold in other countries

Economic Model
➢ Simplified representation of economic forces

Forms of Economic Model

➔ Descriptive economic model
➔ Assumption
➔ Mathematical Model
➔ Graphs

ECONOMIC GROWTH AND DEVELOPMENT PPT 2

3 Big Macroeconomic Questions
1. What determines the standard of living?
2. What determines the cost of living?
3. Why does our economy fluctuate?
Standard Of Living (PSA Definition)
- Level of consumption that people enjoy and is measured by the average income per
person

Cost Of Living ( PSA Definition)

- Amount of money it takes to buy goods and services
*Rising cost of living is called Inflation and deflation as otherwise

Concept of Production
➔ The concept of production is limited by the amount of resources available in the
Production Possibility Frontier (PPF), the basic measure of a nation’s income, that is the
Gross Domestic Product (GDP)

Economic Growth
- Refers to the percentage change in a nation’s per capita GDP - the money value of all
goods and services produced by one country over a long period of time

Economic Development
- Increase in living standards
- Increase in educational standards
- Improved health care
- Improve infrastructure

In 2013, the World Bank Group adopted the twin goals to guide its work:

➢ Ending extreme poverty

➢ Boosting shared prosperity

Factors in building an economy

● Saving and Investment
➔ There is a need for a country to promote both domestic and foreign investments
in order to reduce unemployment.
➔ Ideally, a reduction in unemployment will reduce poverty levels and the
government’s social burden, which will allow for increased public savings.
● Diminishing Returns and Catch-up Effect
➔ Productivity is considerably affected minimally when the workers with a large
quantity of capital they use in the production process are given extra units of
capital.
➔ a higher saving rate leads to greater productivity and income but not greater
growth in these variables.
● Investment from Abroad
➔ An investment that is sponsored with foreign money and operated domestically is
called a foreign portfolio investment
 ➔ It is expected that the use of foreign money would mean more opportunities to
produce where the money is capitalized, but, of course, a certain interest in that
money is foreseen as well.
*The World Bank (WB) and the International Monetary Fund (IMF) were established to ensure
that there is economic prosperity around the world
● Education
➔ More quality educated people produced in a country would mean an opportunity
to generate more and better ideas to produce goods and services.
● Health and Nutrition
➔ capable of producing more goods and services because they can maximize
employment as compared to an unhealthy population.
➔ healthier individuals are more productive.
● Property Rights and Political Stability
➔ Property rights ensure the exercise of rights over one’s property and these
guarantee more production of goods and services.
➔ A stable political environment is considered to have efficient executive,
legislative, and judiciary systems, working together for the country’s economic
development.
● Free Trade
➔ competitive economy that reduces or eliminates trade restrictions experiences
economic growth
● Research and Development
➔ products of research and development (R&D) are new ideas, goods, and
services that people consume.
● Population Growth
➔ relatively large population means more human resources working and
contributing to the production of the country
➔ more people to consume those goods and services.

*In production, we consider the factors such as quantity of labor (L),the quantity of physical
capital (K), quantity of human capital (H), quantity of natural resources (N), and technological
advances (T), and if we are to summarize the output of production (Y), we say Y=Tf{L, H, N}

Productivity
● means the amount of goods and services produced from each unit of labor.
*Remember the factors of production:Land , labor, capital, and entrepreneurship.

Productivity Factory
● Physical Capital
- Assets that are utilize to produce goods and services
● Human Capital
- Knowledge, skills,and abilities (KSA) humans develop
● Natural Resources
- Refers to the bounty of the land and water used in production
 ● Technology
- Innovation and advances to make life easier and more efficient production

O-Ring Theory
● O-Ring theory of economic development was proposed by economist Michael Kremer in
1993, which explains that production is composed of a set of tasks, and each task must
be carried out proficiently for each one of the tasks to have value.
● graph explains the relationship between output and quality. As the level of output goes
down, the quality also drops.
● The model explains further why poor countries have workers that are considered in less
capital-intensive production processes like agriculture.b

SOLOW MODEL

In neoclassical economics, one of the most popular models that is used to understand long-term
growth is the use of the Solow Model.

The model was developed by Robert Solow, an American economist and a Nobel Prize winner
in Economic Science and in 1956, wherein gross domestic product per worker, capital per
worker, depreciation rate, savings, and investment rates are factored in analyzing growth.

POVERTY AND INEQUALITY PPT 3

Poverty
● According to Amartya Sen, a Nobel Prize Winner in Economics, poverty is a complex,
multifaceted world that requires a clear analysis in all of its many dimensions
➢ Geographical
➢ Biological
➢ Social
● General scarcity, dearth, or the state of one who lacks a certain amount of material
possessions or money

2 Main Assets that the poor derive their Income:

1. Own Labor - largely unskilled labor
2. Agricultural land

Absolute Poverty
- Lack of means necessary to meet basic needs such as food, clothing and shelter

Relative Poverty
- Takes into consideration individual social and economic status compared to the rest of
society

Extreme Poverty- disadvantaged in basic living conditions, such as food, clean water, sanitation,
housing, good health, and even information.
Factors of Poverty
➔ Disease
➔ Ignorance
➔ Dishonesty
➔ Dependency
➔ Apathy

Poverty and the World

- Those who are considered the poorest normally work in the agriculture sector; highly
uneducated; labeled as illiterate; mostly considered malnourished
- Industrial Revolution created a great deal of inequality and to even intensify the gap
between poor and rich nations
- Technological change helped the rich countries, thus replacing unskilled workers

Poverty Line
- set by the government as the threshold to which the absolute value of income and
expenses is compared to consider a family to be in poverty.

Poverty rate
- proportion of the population that is below the poverty line

Subsistence incidence
- In the Philippines, further classification of the part below the poverty line suffering from
extreme hunger

Economic Inequality
- Also known as income/wealth inequality
- Difference found in various measures of economic well-being in a group

Wealth Inequality
- Uneven distribution of accumulated assets

Income Inequality
- Income distribution in an uneven manner

Poverty Incidence
- Percentage families or individuals with per capita income or expenditure less than the
per capita poverty threshold to the total number of families or individuals.

Lorenz Curve
- developed by American economist Max O. Lorenz in 1905
 - relationship between population in percentile ranking and the national income

Gini Curve
- Inequality gap
- Corrado Gini
- Scalar metric of inequality

Poverty Gap
- Poverty is a fluid idea with different meanings in different places. It generally represents
earning or living off of less money than adequate, as deemed by a particular country or
region.

Poverty Reduction
- The government plays an important role in reducing poverty in the country through its
policies to improve the welfare of the people.

Cash Transfers
- Conditional Cash Transfer (CCT) programs aid families who are considered poor.

In-Kind Transfers
- provide goods and services as social safety nets through specialized welfare programs
such as social pension

Work Incentives
- Commonly happen when a natural disaster occurs
- help rebuild the place of adversity in exchange for a reasonable wage

Minimum Wage Law

- act of Congress or the Senate that imposes a minimum payment of wage to workers in a
specific location, duration of work, and nature of the industry
- income is provided to a specific group of employees.

Adjust Tax Code

- Intended not to collect any form of tax from individuals who earn a specific amount or
less in one year
-
PPT 3
NATIONS WEALTH & COST OF LIVING

NATIONS WEALTH

Wealth of nations
 - Adam Smith, the father of Economics, in 1776, published a paper titled, “An Inquiry into
the Nature and Causes of the Wealth of Nations” or more simply, “ The Wealth of
Nations”.
- The foundations of a lot of economic concepts such as laissez-faire, minimizing
government intervention, free markets, the work of the invisible hands that guide the
supply and demand and creation of wealth not only from land but also from assembly
lines, and market systems and capitalisms.
- Nation’s wealth is relative to the use of limited resources.

Gross Domestic Product (GDP)

- The market is composed of buyers and sellers who may be the government, firm, or
household, and the interaction of the two creates income and expense that may be used
to measure the goods and services that flow within the economy or the circular flow of
national income.
- Gross Domestic Product is considered by economists as a major measurement of a
nation’s income at a given time and at a given place or region.
- GDP is the peso value of all final goods and services that are produced in one country in
a year.

2 methods to COMPUTE GDP

1. Expenditure Approach
- Summarizes the total expenses to buy final goods and services by households,
firms, and the government.
CONSUMPTION SPENDING + INVESTMENT SPENDING + GOVERNMENT SPENDING +
NET EXPORTS = GDP
● CONSUMER SPENDING - peso value that households are spending for
final goods and services in a year.
● GOVERNMENT SPENDING - both national and local government units
spending to acquire goods and services that are used for public facilities.
● NET EXPORTS - difference between the final goods and services derived
from importation from exportation.
2. Income Approach
- Summing all the factors, or primary, incomes earned in the production process
plus taxes less subsidies on products.
TOTAL NATIONAL INCOME + SALES TAXES + DEPRECIATION + NET FOREIGN FACTOR
INCOME
Total income - sum of all wages, rent, interest and profits
Sales Taxes - tax imposed on consumers for sale of goods and services
Depreciation - cost allocated to capital assets over an estimated useful life
Net foreign Factor Income - income citizens make while abroad, less the income generated by
foreigners in the country

Uses of GDP
 - We can compare the economic performance on an annual basis by determining the
growth rate to help us understand where the economy stands.
- To assess the efficiency and effectiveness of government policies.
- To compare the GDP with that of other countries.

REAL GDP & NOMINAL GDP

- In order to measure the total spending that is minimally affected by the changes in the
prices of goods and services, economists have come up with a measure they call real
GDP that evaluates current production using constant prices. 1st yr/OLD P X NEW Q
- In computing the nominal GDP, the current prices are used to multiply the volume of
production given a period of time. NEW X NEW

GDP DEFLATOR
- Implicit price deflator or GDP deflator is a metric used by economists to understand the
changes in prices of products that are produced in one country.
- Consumer Price Index(CPI) is a measure of the average change in the prices paid over
time by urban households for a market basket of goods and services.
- GDP Deflator = Nominal GDP / Real GDP x 100
Inflation rate = NEW DEFLATOR - OLD DEFLATOR / OLD DEFLATOR X 100
UNEMPLOYMENT RATE = number of people unemployed / labor force x 100
GDP per capita - is a metric used to measure the overall production of goods and services in a
country translated to the value per person.

OTHER MEASUREMENT OF NATION’S WEALTH

Gross National Product.
This is the sum of all the finished goods and services produced by the citizens of a country
overseas and domestically.

Net National Product.

This is the sum of all the finished goods and services produced by the citizens of a country
overseas and domestically less depreciation.

National revenue.
This is part of the national budget of a country that is composed of all revenue sources to be
used in national expenditures.

Personal revenue.
This is the sum of an individual’s or citizen’s earnings from salary, wages, and investment during
a period of time.

Disposable personal revenue.

This is the sum of an individual’s or citizen’s earnings from salary, wages, and investment during
a period of time less current individual taxes.
GROSS NATIONAL HAPPINESS (GNH)
is founded on the basics that happy people live longer and thus will need less public health
funding. They can achieve more in terms of productivity. GNH reflects the normative values of
culture and traditions.
- Kingdom of Bhutan
-The Kingdom of Bhutan is known for its application of a unique metric for the nation’s
wealth and well-being. They believe that happiness is living in harmony with nature while
serving the people, including economic inputs.

Genuine Progress Indicator

(GPI) is a metric founded on the index of sustainable economic welfare and growth.

COST OF LIVING
COLA- Cost of Living Allowance

Inflation- increase in prices

● Demand-pull Inflation
- Increase in prices resulting from excessive demand
● Cost-push inflation
- Increase pricing by sellers in the absence of increase demand
● Monetary Inflation
- Expansion of the money supply

Basket of Goods and Services

● Philippine Statistics Authority (PSA) conducts Commodity and Outlet Survey (COS) to
understand the goods and services that each households in the country purchases or
consumes, and the type of channels in the country wherein these are available.

Consumer Price Index

● The Consumer Price Index (CPI) is statistic used to measure the total goods and
services purchased and consumed by a household compared to a base year
● According to ENCYCLOPEDIA OF AMERICAN GOVERNMENT AND CIVICS, CPI is a
measure of the average change in the prices over time by urban households for a
market basket of goods and services.
Uses:
- Determining inflation and the purchasing power of the country's currency to allow
adjustments to the economic policies of the government.
- Make us more reactive to the buying behavior of the public and create laws to
alleviate the standard of living of the people.

Computing:
BASKET OF GOODS= YEAR PRICE X QUANTITY (IF 2 PRODUCT ADD)
CPI= Basket of goods in the year/Basket of goods last year X100
Inflation rate = NEW CPI - OLD CPI/ OLD CPI X 100
Economic Crashes
● When there is too much supply of money in circulation, people somehow forced to spend
as quickly as possible rather than decide to save their money leading to declining in
personal wealth and savings and limiting foreign investments and trade, money
increases too fast that it pushes inflation to rise instantaneously, which affects the
velocity of money.

Depression & Recession

● USA experienced the GREAT DEPRESSION IN THE 1930's, which started in 1929.
There was a sustained decrease in the GDP.
● After the great depression, the USA did not want to recall the painful experience and
somehow changed the term to a RECESSION.
● According to the USA National Bureau of Economic Research, a recession is defined as
three consecutive quarters of falling real GDP, while a depression includes a 10%
decrease in per capita GDP and consumption.

Stagflation
● Combination of a stagnant economy and inflation at the same time. There was a
combination of falling demand and rising prices.

COLA- Cost of Living Allowance

● Adjustment applied to the income received by the employees to sustain the standard of
living due to the inevitable rising prices or inflation.
● When CPI increases, the COLA is then raised to adjust the market value what is
received by the employees to maintain their standard of living.

Standard of Living
● Measures the material characteristics of the economy and the number of goods and
services that are produced and are made available to households, firms and
government.
● Level of material well-being enjoyed by an individual or group

Big Mac Index

● Metric is based on the concept of purchasing power parity (PPP), a currency exchange
of equalizing prices of products in various countries in the long run.
● Is an idea of an identical basket of goods and services in different countries based on
PPP theory.

Other measurements for the Standard of Living:

● Life expectancy
● Quality of education
● Environment
● Literacy Rate
● GNI per capita
 ● How income is distributed to its population

Lorenz Curve & Gini Index

● Method that is used to understand economic inequality is the analysis of the income
percentages in relation to the percentage of the population, normally spread in percentile
ranking, this is what we called LORENZ CURVE.
● A few years later, in 1912, an Italian scientist developed a metric used to measure
income inequality with the use of the Lorenz curve, which is known as the GINI INDEX
OR GINI COEFFICIENT. The value of the Gini index is from 0 to 1 or 0 to 100%.

Target and Indicators for SDG 17

● The United Nations Department of Economic and Social Affairs UN-DESA released the
17 Sustainable Development Goals (SDG) adopted by all member countries of the UN.
●

PPT 4
AGRICULTURE AND RURAL DEVELOPMENT
● development of areas outside the urbanized economic system is what rural development
is all about.
● In The Philippines, agriculture, forestry, and fisheries (AFF) contribute to employment
and provide industries with raw

MODERNIZATION AND INDUSTRIALIZATION Of AGRICULTURE

● Agriculture in economic growth and development Means the income is higher and the
food is cheaper and easier to obtain.
● Efficiency in agriculture and rural development is defined by the sustainable food
production in one's country relative to the cost of its production.
● In order to be more efficient i n the business of agriculture, farms are becoming more
specialized In terms of production to optimize the Costs and realize the maximum profit.
● The increasing Population translated into more demand for food that is available in the
market. This can only be fulfilled if we can produce and harvest more AFF products fast
and efficiently.

EXPORT PROMOTION
● Exportation of AFF products is a conjoined effort of different agencies of the government
relevant to the production, marketing, improving, and transporting of raw materials and
processed goods to other countries.

INFRASTRUCTURE DEVELOPMENT
● Infrastructure is beneficial to agricultural and rural development as it serves as the
backbone of the AFF industry and stabilizes the movement of products within and
outside the rural areas.

Roll on/ Roll of or RORO boat

GENETICALLY MODIFIED ORGANISMS
● Genetically Modified Organisms (GMOs) are organisms in which the genetic Material is
altered using modern biotechnology, typically a recombination of deoxyribonucleic acid
(DNA) to create new genes.
●

GREEN REVOLUTION
● the term " green revolution" is attached to a Novel Place Prize winner, Norman Borlaug,
in his attempt to improve crop yield in South America and later brought to Asia through
Pakistan and India.
● Combination of more modern mechanized vehicles, better crops and hybrids, larger
farmlands and the application of large scale business management skills to growing
food.
● Micronutrients are another product of green revolution.

SUSTAINABLE AGRICULTURE
● the United Nations Department of Economic and Social Affairs UN-DESA released the
17 Sustainable Development Goals (SDG)

OCEAN, SEAS, AND MARINE RESOURCES

● " are considered vital agricultural aspects that are much given attention. They serve as a
main source of food security and other forms of medical derivatives and even source of
energy.

ECOTOURISM
● Tourism is often described as the World's largest industry, while a small component of
the overall industry, ecotourism, is believed to be one of the fastest growing sub sectors.
characteristics :
1. Ecotourism Occurs "in nature"
2. Considered to be "low impact", with minimal disturbance to the environment
3. A portion of the profit should be in conservation efforts .
4. education to both tourists and local people
ADVANTAGES OF ECOTOURISM
● Conservation of the ecosystem
● Allowing environmental recuperation
● Environmental awareness
● Promotion of culture and indigenous people
● Financial and economic benefits

DISADVANTAGES OF ECOTOURISM
● Disturbance of wild species of flora and fauna
● May lead to the overproduction of species
● May cause pollutants by tourists
 ● Budget of more significant purpose may be diverted to ecotourism
● Negative externalities

CHALLENGES
● Mismanagement of the government funds in ecotourism
● Lack of skill of the people in the rural areas to properly operate sustainable leisure
● Possible conflict between tourism management and indigenous peoples
● Deficiency of infrastructure in the area that may support ecotourism

THERE MUST BE BALANCE BETWEEN THE ENVIRONMENT AND SOCIO ECONOMIC

IMPACT OF ECOTOURISM IN ORDER TO REALIZE ITS VALUE TO ECONOMIC
DEVELOPMENT.

PPT 5

INDUSTRIALIZATION
- Industrialization is one of the key factors of economic growth and development, not to
mention the proper use of natural resources, utilization of real or physical assets, and
employment of labor or the population.
- This includes the regulation of the economic activities of an institutional framework, that
is the government.
1st Industrial Revolution 1700s - mid 1800s
- Spinning jenny (1st weaving machine)
- An essential factor of industrialization at that time was to increase food and thereby
consider the more efficient way to produce agricultural products.
- Agriculturists were very influential in their innovations in terms of producing new crops
and breeding animals.
- Robert Bakewell contributed a lot to the science of animal husbandry devices like the
seed drill for Jethro Tull, and the cotton gin of Eli Whitney.
- demand to transport goods and labor led the way for the railroad, steam engine trains,
and many machine tools
- Iron and coal primary energy source
- steam engine trains
- James Watt - enhancement of steam engines by introducing double-acting piston
motion
- Joseph Bramah - hydraulic press
- Henry Maudslay - lathe slide and pattern screw
- Jesse Ramsden - dividing engine led

2nd Industrial Revolution 1800-1900

- " modern life"
- an immense sharing of science and technology, like the canning of food to the study of
bacteria.
- Nature has been vastly studied and used for the production of goods and services.
 - huge migration from rural to urban areas.
- Entrepreneurship capitalism was introduced
- electricity , automobile and telephony
- In 1908, Ford was able to eliminate the skilled craftsmen for steel and iron with the
“Assembler”
- The perfect interchangeability was achieved by Cadillac in 1906.
- Shewhart - Statistical process Control (SPC) tool used to identify variability process in
1924.
- food preservation with the use of refrigerators and canning
- photography, motion pictures and music through phonograph
- 1800 - 1900s

3rd Industrial Revolution 1900 - 1999

- Post Foundationalism, Social transformation
- computerization, market competition and globalization
- Scientific management continued to be developed, and this was after the Second World
War which ended in 1945.
- Toyota Production System (Lean Production) was introduced by Eiji Toyota
- Taiichi Ohno revolutionized the production of cars
- Deming- philosophy on the 14 points of quality Management
- Motorola - 6 Sigma of quality management
- Mid 1900 s - 1999

4th and 5th Industrial Revolution 1999 - current

- the primary aim of industrialization is to increase productivity, thereby improving the
standard of living of the people.
- toyota 's Robina and Humanoid or ASIMO robot of Honda
- robots built to assist the elderly and interpret emotions for human socialization.
- period of industrialization focuses on biotechnology, additive manufacturing,
telecommunications, and transportation
- purposes of researching and developing genetic engineering such as DNA sequencing
and gene editing are to develop a treatment for some congenital diseases
- biotechnology genetic engineering - DNA Sequencing
- Transportation , bullet train, auto driving cars
- 3D printing technology - targets the businesses of automobiles, textiles, military, medical,
consumer products, and others
- Smartphones
- applications
- Softwares
- Social media
- Transportation are run by automated technology
- 4th - 2000 to present

Modes
 - Mercantilism - protecting the economy of one's country
- Lara Magnusson - Mercantilism was characterized by a strong emphasis on the means
to achieve national wealth and power.
- Protectionism - Set of policies by which a government Seek a shelter its industries from
foreign Competitions , Tariff
- Laissez-faire - less involvement of government - " let alone"
- Importation - buys from other country
- Exportation - sell our products

Cost of Industrialization
- Businesses that produce goods and services are basically motivated by self-interest
which is maximizing profit
- Capitalists and even governments tend to save for future survival

Deindustrialization
- it seems that the model of economic development is changing; a developed nation may
not necessarily be the one exporting to other countries.
- There is much automation in the manufacturing of goods and services, an evident
decrease in jobs in manufacturing, and an increase in the service–sector jobs.

Urbanization and the World

- The United Nations Department of Economic and Social Affairs, Sustainable
Development Goal 11 states, “make cities and human settlement inclusive, safe,
resilient, and sustainable.”

Targets and Indicators in relation to Urbanization

- By 2030, ensure access for all to adequate, safe, and affordable housing basic services
and upgrade slums
- provide access to safe, affordable, accessible, and sustainable transport systems for all,
improving road safety, notably by expanding public transport, with special attention to the
needs of those in vulnerable situations, women, children, persons with disabilities, and
older persons
- enhance inclusive and sustainable urbanization and capacity for participatory, integrated,
and sustainable human settlement planning and management in all countries.
- Strengthen efforts to protect and safeguard the world’s cultural and natural heritage.
- significantly reduce the number of deaths and the number of people affected and
substantially decrease the direct economic losses relative to the global gross domestic
product caused by disasters, including water-related disasters, with a focus on protecting
the poor and people in vulnerable situations
- reduce the adverse per capita environmental impact of cities, including by paying special
attention to air quality and municipal and other waste management.
- provide universal access to safe, inclusive, and accessible, green and public spaces, in
particular for women and children, older persons, and persons with disabilities.
Today, we are experiencing the fifth industrial revolution
- Goods and services are available that were considered impossible half a century earlier.
- There is a price that must be paid with a modernized, industrialized economy: pollution,
health, and social issues.
- We need to constantly visit our laws and policies to protect future generations from total
degradation.

Labor Market ppt 6

Labor - most important of factors of production

- largest Share in almost all economies with the gross rational earnings.
- labor market operates by supplying Skills or talent that someone else would need.
○ Roles in a labor market are determined by the one who supplies the labor and the one who
buys it.

Demand for Labor

- Demand is the link between the price and the quantity demanded for it.
- Labor is the input to a factor of production.
- We hire labor to produce goods to sell.
- Labor markets exist with the invisible hands at work, the forces of supply and demand.

Supply for Labor

- Supply is the link between the price of a product and the quantity supplied for it
- Labor is the input to a factor of production
- Labor markets, like any other markets, exist with the invisible hands at work, the forces
of supply and demand.

Reservation wage
- the minimum rate that a worker is willing to accept for a specific job

Wage
- must cover the opportunity cost

Derived demand
- If the demand for a certain good or service is booming, more of it is produced offered in
the market, and ultimately increase wages

Efficiency wages
- where there are some businesses that provide high wages to their employees

Minimum wage
- is the price floor that ensures employees receive this amount or more, and employers
are prevented from paying below this amount.
Skilled workers
- are those who have special skills or who have had long training.

Immigration
- move between countries and become part of the labor market of that country, that is
called

Wage discrimination
- happens when there is monopsony – there is only one buyer of the labor offered

Human Development Index (HDI)

- indicates the average well-being of people in a country in a given period of time.

Life Expectancy
Population: 70.48 years
Male: 66.97 years
Female: 74.15 years

Knowledge
- literacy
Age 15 and over can read and write
Population: 96.3%.
male : 95.7%
Female: 96.9%

- School life expectancy

All: 13 years

Financial System and Development PPT 7

3 main roles of money.

1. medium of exchange
2. store of value and a unit of account
3. standard of measurement

Financial System
- network of institutions, markets, and contracts that bring together lenders and borrowers
- the two main players in the System.
Lenders - believe that money that they now have the potential of snowballing in the future ; they
and it to a financial institution.
Borrowers - households that need to buy a house or a car but does not have enough money on
hand to acquire it ; firm that needs more capital to fund an assets to bring more income.
Lenders and Borrowers agree to fulfill their goals through exchange in 3 ways
1. banking system
2. those who loans fund for themselves
3. bond market

Investment - committing funds to one or more assets , which Can be financial or real assets.
Most individuals and firms make this decision to increase their wealth.
Savings - a part of the wealth that may be used to fund the investment of another

● Financial assets are someone else's liability and are manufactured by the stock Market
or any financial institution.

5 investment Assets/ Investment classes

● Financial Assets
- Stocks
- Bonds
- Currencies
- Commodity
● Real Assets
- Real Estate
- Commodity

➔ Short-term instruments, mostly securities that mature in less than one year are traded
in the money market.
➔ Long-term instruments are those that mature more than a year and are traded in the
capital market.
➔ Financial derivatives are forms of financial instruments, the value of which is derived
from another instrument. It is a tradable financial instrument based on an asset’s
underlying value.

Money - coin, etc. used as a trading medium; any currency used in the same way
Cash - money on hand
Capital Market - the market for longer-term loanable funds
Debentures - issued as evidence of a borrower's debt. used by companies to raise finance
repaid over the long term.

● Process of investment essentially involves:

Portfolio management - building the collection or set of assets
Allocation of Assets - splitting of the portfolio into five or less types of investment classes
Construction decision - choosing from the top-down or bottom-up approaches in portfolio
management.
 - Top-down portfolio - by country
- Bottom-up - looking at specific company/ies then investing in it

Investment management - channeling funds by means of financial intermediaries , appropriation

of the investment class , and managing ownership of funds

Ownership and management exist in a separation concept and deal with agency issues, of
principal and agent roles. Hence, in order to mitigate the issues, there must be good corporate
governance in place and regulated by the government or state.

Corporate governance - examination of the control of a company as exercised by its directors.

A competitive may be characterized by:

● How risk and return are optimized ?
● How efficient is the investment market?
● How appropriate is the style of investment, whether active, passive, or a combination?

Stocks - investments _ equity

Bonds - debts_Iabilities

Key players in Financial System

● Firm - businesses issuing Securities (debt or equity) or financial instruments
● Government - never over funds and is considered always in shortage
● Household - ones who lend and borrow from financial intermediaries
● Financial intermediaries - one that positions between the debtors and the creditors

land - deposit
borrow - loan

Flourishing Savings and Investment Relationship - existence of a lively financial system in one
country provides facilities for individual and firm Savings.

Develop Labor and Employment - more manufacturing companies can boost their working
Capital , thereby, they are able to employ more individuals for their production.

Growth in Capital and Securities Markets - Capital market issues debentures and shares to the
public and other fond institutions that are expecting good returns from their fixed capital or fixed
assets. Short-term loans are available for daily business operations and help in the continuity of
the business and trade. Foreign exchange Markets help address transactions that involve
foreign currencies, help raise funds for these companies, and support the forex requirement of
some companies that are dealing with other countries.
Trade Development - Advance business , both domestically and internationalIy, allows Capital
goods to be sold through hire purchases and installments schemes. For those firms that engage
in Shipments, financial institutions allow the issuance of letter of credit, finance them and even
offer. discount some financial instruments like bills.

Infrastructure and Technology Development - Countries that are not dependent on natural
resources financial institutions allow financial prosperity by the governments.

Economic liberalization - is set as a policy establishing development banks and merchant banks
to raise funding for infrastructure buildings

Uphold Fiscal Policy - existence of a worthy financial system in one Country helps in the control
of inflation, recession and depression through a Sound policy on finance. The system is
regulated by the Bangko Sentral ng Pilipinas. Laws and other legislation May be enforced to
mitigate the risks of unwanted and speculative transactions.

Interest rate is higher when there are many money circulating in the market

Attract foreign investment - vigorous financial systems in one economy entice potential investors
in various Sectors and provide more production opportunities and investment prospects that can
lead to economic growth and development.

Foster Economic Integration - inevitable integration of countries in proximal distances or

regions, forming economic integration tends to have a common investment, trader practice and
even legislation.

Balance Regional Development - provide Various Concessions and stock Ownership plans
(SoPs) that eventually help avoid political risks in regions.

Sustain Macroeconomic Balance - having a good financial System allows balance in the
industrial, agriculture and service sectors, ensuring that contributors to the national income
benefit from the financial resources.

Average return - used to smooth out variations in a fund's return

Return = Today's Price - Yesterdays Price - 1

Not Included in quiz

Average Return (Excel) = Average + All returns
Variance (Excel) = Var.p + All returns
Standard Deviation (Excel) = STANDARD DEVIATION + All returns
…

Role of Finance
● Link the Savers and investors
● Screen and monitor investments
● Smoothen Consumption
● Manage risks
● And manage payment systems

● Financial Development has been Considered an efficient mechanism for sustainable

economic growth and development of emerging markets.
● The study by Thang et al. in 2019 published in the Journal of Risk and Financial
Management

Finance and Governance - there must be a sound legal system to generate trust because this
affects the borrowing and lending behavior of individuals and firms.
 ● Effective Corporate governance - examination of the control of a company as exercised
by its directors. The directors of public companies Are accountable for their actions to
the company shareholders.

Microfinance
● range of financial products focused on low - income individuals who have generally been
Overlooked by traditional financial Service providers. They have been neglected by or
denied access to mainstream financial institutions because of the perceived risk or
relatively low balances/high transaction accounts to maintain.
● is available as well, like the rotating Savings and credit association (ROSCA's)

Financial products
- loans
- insurance
- Savings
- investments
Financial institutions
- banks
- lending
- loan sharks
- pawnshop
- Cooperative

E - Enterprise
M- Micro - not more than 3,000,000
S- Small - 3,000,000 - 15,000,000
M- Medium - 15,000,000 - 100,000,000

Microcredit
- ways of improving access of the poor to a variety of financial services, including micro
Savings and micro insurance. Microcredit does not require collateral, relatively because
of the value of the loan. It may be borrowed one time or on a recurring basis, depending
on when a need arises. Interests on microcredits are relatively high
-
two Common Types of ROSCAs
- Random - familiar to the regular paluwagan of Filipinos, wherein a fund is formed by
contributions of those who agreed on the microsavings
- auction - a bid is tendered by those who want to pool their money.

Islamic financial system - promotes economic growth.

- The Islamic finance model has its foundation and origin in the Koran and in the sunnah.
- bound by a conventional body of rules and regulations as well as the historical, social,
and economic context of the country in which the model has been implemented.
Foreign Trade Ppt 8

Foreign trade - exchange of goods and services between countries

- Early people exchange goods for a different variety of products, we know it as barter.

● Countries in Asia are aiming to increase their exports

● Technological Innovations led to globalization and Made the world seem borderless in
terms of trading.
● As believed, one country Cannot be self - sufficient, does not have everything in the
world, and must exchange for another product

History of Foreign trade

● Mercantilism started towards the end of the seventeenth century. Mercantilism valued
the balance of trade, exports given to a foreign Country must, at any time, exceed
imports, if not equal.
● In the eighteenth Century, Adam Smith wrote a book , The Wealth of a Nation .
● Comparative advantage, wherein each country specializes in a particular product or set
of products and imports everything else for consumption.
● A country has a comparative advantage in the production of goods and services if that
particular country can produce the same at a lower opportunity cost than other countries.

Concept of Foreign Trade

● Households and firms around the world constantly change their demand for goods and
services that may not be available in their country; hence, there is a need to acquire
these products in exchange for its own capital, goods and services.
● In The computation of the GDP, we include a component of international trade that is net
exports, the difference between exportation and importation, and the balance of
payments.
- When a country exports more than its imports, there is a trade surplus.
- When there are more imports than exports, there is a trade deficit.
- Balance payments include all payments out of a country and its trading partners
and comprise the balance trade, private foreign loans and their interest, loans
and grants by governments or international organizations, and movements of
gold.
● Foreign exchange market - Another concept in international trade is where the foreign
currency is being traded

Gains from Trade

● Production Costs - Raw materials in certain countries are cheaper than the others
making the production costs lower.
● Competition - increasing recognition that the benefits of international trade liberalization
may be negated by domestic measures hostile to an open competitive market
environment.
 - In a highly competitive market, prices are low because these business entities
tend to compete with each other’s prices and quality of products.

● Production Variation - Products that are available depending on the season may be
accessed at any time of the year as they can be supplied by a country that is not
affected by seasonal changes.
● Surplus Market - producer countries of agricultural products or other perishable goods
that may have surpluses and would be willing to exchange these for other products that
are useful to them.
● Market Efficiency - Seasonal fluctuations of the products affect some companies that
may lose the opportunity to do business when their product is in low demand

Risk of Foreign Trade

● Buyer Risks - challenging to start international trade with the first client
● Seller Risks - Reputation may be compromised as two factors must always be met
● Third-party Risks - Failure to honor buyer-seller agreements

Effects of Foreign Trade

● World price is the price of a product set to other countries except for the price in own
country
● We tend to export goods and services with domestic prices lower than the world price
and import goods and services where the local price is higher than the world price.

Tariff - imposition of tax on imports

Foreign Direct Investments

- is measured to be one of the key components in global economic integration (OECD,
2002).
- usually benefits countries by establishing their operations, acquiring tangible assets, or
even stakes in local businesses.
- a long-term capital flow or investment in which a non-resident entity has significant
management control of voting stock (10% or more) over an enterprise in a foreign or
host country.
- The main goal is to optimize earnings by minimizing costs that may and may not be
advantageous to the investment enterprise country.

Forms and Types of Foreign Direct Investments

● Greenfield Investment - is when an investor MNC starts a new venture in a foreign
country by constructing new facilities to operate from the ground and up; the purpose is
to create a long-term presence in the country
● Brownfield investment - is when purchasing an existing ‘enterprise,This type of FDI
provides an opportunity to establish and tést the sustainable development practices
● Horizontal FDI - is when the parent company carries out the same activities in the
enterprise.
 ● Forward FDI - is known for the parts of the production chain that are done abroad,
● Backward FDI - is an international integration where materials are sourced abroad, like
acquiring a rubber plantation to be used for the rubber needs as materials for the MNC.
It may also be known as a conglomerate type for the business which is considered not
related to the business in the home country

FOREIGN AID PPT 9

● FOREIGN AID started after World War 2, especially in Europe .
● need to rebuild a severely devastated region that will be restored by other Countries like
the United States of America.

World War 2
- Germany
- Holocaust
- Hitler
- Poland
- Jewish
- Great Britain
- France
- Asia
- Southeast
- Japan
- USA
- shortage oil, natural resources
- Indonesia

● In 1944, the World Bank was formed.

● In 1945, the United Nations was founded with The intention to maintain and Secure
Peace among Countries
● The International Monetary fund (IMF) started to stabilize and oversee the international
monetary system.
● In 1944, an agreement was signed in Bretton Woods, New Hampshire, USA that created
the IMF.
● IMF - “lender of last resort”

Foreign Aid - donation or transfer of help in the form of money, goods and services to a country
that needs it.
- aims to foster peace and security among nations, assist in the growth and development
of one country, enhance the health and education Systems
2 Forms of foreign Aid
1. Official Development Assistance (ODA) - Sources of funds to finance programs or
projects that promote Social and economic development in the form of loans or grants.
 2. Non- governmental Organization ( NGO) - work toward the public. NGOs can be funded
by donations and grants.

Humanitarian Aid - helps Managing short - term suffering, providing assistance to those who are
affected from a recent typhoon or hurricane and other disasters.

Development Aid - permanent aid, like long-term loans provided to build infrastructure program

Foreign Aid - pushed back to a steady state level of investment that is equal to the capital if
there is no improvement of fundamental factors such as technological advances.
- may encourage CORRUPTION, as government officials in some countries tend to use
the funds for their gains, like for reelection purposes.
- dependency becomes more evident, and effort for economic development tends to be
neglected.

★ The United States under the leadership of then-President Harry Truman signed the
Marshall Plan, also known as the European Recovery Program, which aimed to rebuild
Europe that was devastated by the war.
★ - helped legitimize and lay the groundwork for u.s foreign aid programs that have come
since

PEACE AND SECURITY

● There is a link between foreign aid in the form of food security and peace, especially in
some countries in Africa and South Asia.
● conflict-sensitive development aid allows peacekeeping-activities and those that
reduce the inflation of an affected nation, hence fostering peace among the people

PUBLIC HEALTH
● One of the main goals of foreign aid is to eradicate certain diseases that cause an
‘economic disruption
● World Health Organization (WHO) promotes the attainment of the highest level of
health and safety
● The World Health Assembly is the decision-making body of the WHO led by member
states of the United Nations.

REMITTANCES
Positive effect on the home country:
● Lowers poverty
● Increases health and education
● Increases technology
● Decreases child labor

Dutch disease exhibits the following two chief economic effects:

 ● It decreases the price competitiveness of exports of the affected country's manufactured
goods.
● It increases imports.
❖ Both phenomena result from a higher local currency.
❖ In the long run, these factors can contribute to unemployment, as manufacturing jobs
move to lower-cost countries. Meanwhile, non-resource-based industries suffer due to
the increased wealth generated by resource-based industries.

INTERGOVERNMENTAL NONPROFIT ORGANIZATIONS

- These organizations are tax exempt in most countries around the world, and their
funding normally comes from a few investors who believe in their goals that are mostly
aiming for human development.
● The United Nations Children’s Fund (UNICEF) is a social welfare organization present
in 192 countries and territories aiming to develop children in developing and
underdeveloped countries.
● International Red Cross and the Red Crescent Movement with 97 million volunteers
to address human suffering and help improve the health conditions of those who are sick
● The World Food Program is an organization under the United Nations that is focused
on hunger and food security. They are also the biggest provider of school meals in
impoverished nations
● Doctors Without Borders, a French-based organization in conflict zones that treats the
wounded in those territories with endemic diseases.

NATIONAL ECONOMIC POLICY PPT 10

Macroeconomics
- Study of the economy as a whole
➔ National Output
➔ National Income
➔ Unemployment
➔ Inflation

- attempts to provide enlightenment to these concepts, quality of life, by understanding the

average enjoyment of individuals, firms, and governments, measured in terms of GDP.
- makes us appreciate how much can be sacrificed to achieve a certain level of quality of
life in terms of money to buy the everyday basket of goods.
- The increasing or decreasing purchasing power of money to acquire these goods and
services called inflation and deflation are also considered.

BASIC MACROECONOMICS CONCEPTS

● Peak - The highest real GDP followed by an economic boom, characterized by full
employment of resources.
● Trough - The lowest real GDP followed by a recession, characterized by low usage of
resources.
 ● Recession - Two consecutive quarters of economic decline in economic activity,
characterized by increased unemployment.
● Depression - Long-term downturn in economic activity, characterized by an economic
slowdown and by sustained fall in the economy in years, not just quarters
● FISCAL POLICY - stimulates economic growth and development by proper imposition of
taxes and subsidies that encourage (or sometimes discourage) economic activity.
● Fiscal expansion- is when there is an increase in deficit, by decreased tax
collection or increased government spending, and
● Fiscal contraction if otherwise.
● Monetary Policy - The government's decision to increase or decrease money in
circulation, as well as the changes in interest rates for borrowings
● Keynesian Theory. Macroeconomic advocacy on more government expenditures,
lowering of taxes to pull out an economy from depression
● Neo Keynesian Theory. The market is not self-regulating: hence, there is a need to
stimulate economic growth by combining fiscal and monetary policies.
● Classical Economic Theory. It explains that an economy will result in full employment
in the long-run with the dynamic movements of value, price, supply, demand, and
distribution without government intervention.
● Monetarist Theory. The most important factor that affects the economic cycle is the
changes in the money supply.
● Supply-side Theory. Free trade, lowered taxes, and decreased government
intervention are key to economic growth and development

TAXATION AND ECONOMICS

- Taxation - tool for resource collection of a civilized society since the early times, like the
tax collection system in ancient Egypt and Mesopotamia.
- Direct taxes - imposed on properties and incomes and need no intermediary in the
collection.
- Indirect taxes - sales and value-added taxes are levied on goods and services by an
intermediary, who may or may not pass the tax to the consumers.
- Regressive taxes - imposed across the board and have a negative impact on the poor,
which might be disproportionate to the rich tax payer.
- Progressive one - as the income increases, the tax rate increases, or the use of the
brackets.
- Proportional - wherein the same percentage of tax is imposed on anyone, regardless of
economic status.
❖ Republic Act 10963, otherwise known as the “Tax Reform for Acceleration
and Inclusion Act” TRAIN - attempts to reform the long-standing inequity of the
tax system by providing income tax cuts for majority of Filipino taxpayers while
raising additional funds to help support the government's accelerated spending
on its “Build, Build, Build” and social services programs.
- providing services that may not be afforded by individuals such as public
safety, national security, and even health and education.
- Budget Surplus - If the government collects more than it spends
 - Budget Deficit - If the government spends more than it collects

ENVIRONMENT AND ECONOMICS

➢ Environmental goods such as clean air, clean water, and natural forests and wildlife have
economic value and are faced with environmental costs while we are aiming for
economic growth and development.
➢ Creating “markets for the environment” is the aim of environmental economics

HEALTHCARE AND ECONOMICS

● The economic concerns in healthcare are the effectiveness, efficiency, and fairness of
outcome of the system in place in a country.
● HEALTHCARE SYSTEMS IN 4 WAYS
1. Single-payer system. All hospitals and clinics are private, but the government
pays for the services they render to the people; however, the costs for drugs,
dental care, and eyeglasses may come from private insurance or personal
savings.
2. Socialized healthcare system, where all hospitals, doctors, and consultants
are. paid by the government, as well as basic drugs and other services.
3. Private system, where the citizens are all required to have health insurance.
4. Mixture of all of these systems, like that of the USA and the Philippines.

● PhilHealth is a mandatory health insurer in the country that provides comprehensive

healthcare services from primary care to catastrophic Situations on the basis of eligibility,
coverage, and specific diseases.
● One important issue in healthcare systems is the existence of the “iron triangle” or the
mutually beneficial relationships of the Congress, government bureaucrats, and the
lobbyists in terms of health policy of the government.

EDUCATION AND ECONOMICS

- Human capital theory by G. Becker in 1975 - explains that individuals acquire more
skills, as when receiving a higher education means income differentials as (in part at
least) a return to human capital, e.g., the correlation between the number of years of
formal education and earning is explained.
- Signaling - shows how smart and hardworking an individual is, and a higher education
diploma would automatically help prove that rather than giving a costly and tedious
assessment of an applicant, for example.
- Education economics is a part of the study of economics that deals with the demand,
financing, and quality of education, as it is seen as an investment rather than a cost in
the annual budget.
- Increase GDP and thereby enhance the standard of living.
- The main issue in education economics is inequality of its proper distribution.
- It is believed that college graduates earn more, thus, contributing more to the GDP of the
country, according to the concept of “College Wage Premium”
 - Economists agree that education benefits all of us; it helps reduce poverty and inequality
and hence improve social cohesion, increase productivity, and develop the economy

COOPERATIVE PPT 11

- These are developed with the interest to make life easier, whether for a variety of
reasons or just one purpose.
- The main responsibility of the members of a cooperative is to share the capital of the
organization.
- Cooperatives are found in the villages or far-flung places in the country, and even in
cities.
● In the Philippines, cooperatives are regulated by the Cooperative Development Authority
(CDA).
- oversee the financial status and operations of the various cooperatives

● Coop distinction from commercial banks:

- 1)Members are part-owners and can influence the management of the organization;
- 2)Around two-thirds of their assets are given back to the members as loans;
- 3)Deposit rates are high but so are the lending rates; and
- 4)Lastly, loans generally do not require collateral.
*Around two-thirds of cooperatives’ net surplus is paid back to the members as
dividends and patronage refunds.

● According to the International Cooperative Alliance (ICA), a cooperative is an

autonomous association of persons united voluntarily to meet their common economic,
social, and cultural needs

● Indicators that the coop is worth investing:

- 1)It has a high reserve fund, stable financial position and good results of
operations;
- 2)It must have a reliable computerized information system to ensure
transparency and accountability;
- 3)The board meets regularly as shown in their records; and
- 4)It must have full provisions for loans and have sufficient capital.

● Interest rates on regular savings in Coops are higher than in banks. Time deposits are
as high as 7% per annum

● Requirements for membership:

- 1)Attend a pre-membership seminar
- 2)Contribute to share capital; and
- Pay the membership and some applicable fees

● Legal Framework
 - Republic Act 9520 or more commonly known as the “Philippine Cooperative
Code of 2008”

7 Coop Basic Principle

1. Voluntary, open membership
- important principle followed by Coops around the world is the voluntarism
principle, where no one is forced to be a member of Coops
2. Democratic Member control
- having one vote per individual in terms of decision-making.
3. Economic Participation
- Members contribute to the coop with the intention of fulfilling the goals of the
cooperative first and sharing dividends with the members.
4. Autonomy & Independence
- legal personality and may transact with other business organizations
5. Education Training & Information
- commitment to continuously educate and train the management and employees
6. Cooperation among cooperatives
- social organizations that may be assisting other cooperatives in achieving their
goals
7. Concern for the community
- the main goal of cooperatives is to make life easier, especially for the members,
and to continue the improvement to sustain this satisfaction.

● there are 18, 848 operating cooperatives as of the fiscal year 2020
● 2,025 in Pampanga
● There are 26 types of coop in the country

● Platform Coop
- aims to unite social platforms around the world to achieve a social cause beyond
territories

● In the Philippines, the top five types of cooperatives are:

- Multipurpose,
- credit,
- Consumers,
- agrarian reform,
- and producers,
comprising almost 87% of the operating Coops in the country.
● On the other hand, the least five types are:
- small-scale mining,
- insurance,
- education,
- federation,
- and union coops,
 having approximately 0.01% of the total operating Coops.

● Economic Impact
- Efficiency - fulfill a need in the community that is not met by the market or even
the government.
- Work Environment - less bureaucracy in the organization
- Ecosystem of Resiliency - It gives an avenue for these organizations to support
themselves. Mutual aid in times of need or emergency.
- Human Development - soft skills of officers and members are developed as they
foster an environment of “togetherness”

● ASEAN plan for Farmer Coop Development

- to create stronger cooperation among Cooperatives, the public sector, and
developing partners of the region for sustainable development.
- To achieve the goal, there must be harmony among the four pillars: institutional
and capacity building, competitiveness, access to finance, and access to the
market.

● Financial Terms
- Patronage Allocation - Includes profits that are apportioned to the members each
year. It is composed of cash refund and/or allocated equity.
- Unallocated Equity - portion of the profit that is not allotted to the members.
 ● It is imperative to apply the financial statement analysis in order to come up with sound
decisions for the organization.
● Annual audit - Another report that is considered vital for the board.

PEACE ECONOMICS AND SOCIAL DEVELOPMENT PPT 12

● Social Entrepreneur
- Person who pursues an innovative idea with potential to solve a community
problem
● Social Enterprises
- These are businesses. They trade, revenue generating, make a profit, and pay
reasonable salaries to staff.
- They do not function purely through volunteering, the receipt of grants, or
donations.
- businesses with a particular social mission.
- That mission is to ensure, as a consequence of their activities and incomé
generation, that their clearly stated social and environmental objectives are met.
-
● Social Economy
- Social entrepreneurship - describes the discovery and sustainable
exploitation of opportunities to create social and environmental benefits.
- Social enterprises - are gaining momentum to help people become more
resilient, to strengthen the labor markets, and to create jobs
- The players of social enterprise development are considered varied and
heterogeneous as the aim is to benefit target groups like the long-term
unemployed, young groups, persons with disabilities (PWDs), migrants,
groups facing systemic discrimination, and many more.
- Social change is the center of social enterprise development, and the
people are the core of its purpose.
- Transdisciplinary approach - is a way to support and foster social
enterprises in solving social problems
- The growth of social enterprises can be implicit to the various factors of
classic Nonprofit organizations,

● Example of initiatives
- viability and sustainability of a social innovation rest essentially on a collective
construction, beyond common social values.
- There is necessary cooperation ‘of social entrepreneurs for sustainable and
responsible social innovation.

● Challenges
 - Goals Conflict - key players of the social enterprise may have varying personal
goals in mind
- Financial Sustainability Issues - The financial performance may be affected
greatly by the current market
- Possible Inconsistent Practices - organizations may find it difficult to hire
employees who may want to deal with disadvantaged target groups
- Lack of Experience - lack of proper strategy, leading to non-competitive products,

● Experiences in Social Enterprise Development

- ●Social corporate responsibility and various human-related aspects are now
included in modern companies’ assessment of business performance.
- ●Online Learning and Massive Open Online Courses (MOOCs) have the
potential to build knowledge and share best practice experiences among
individuals worldwide.
- ●Futurelearn Social Enterprise Program is a series of MOOCs with over 50,000
registered learners, of which 15% become active learners, engaging in online
exercises, debates, and conversations.

● Peace Economics
- deals with the holistic designs of political, economic, and cultural institutions and
policy interactions with the goal of preventing, mitigating, or resolving violent
conflicts within and between societies.
- Characteristics:
1. presence of ‘active resolution management to eradicate or reduce conflict
in the society
2. use of economic metrics and policy to cope with and control conflicts
3. impact of conflict in the economic behavior
- defined as ways to eradicate and control conflicts, as well as conflict impact on
society
- It is by controlling hyper-capitalism that destroys this sacredness

● Peace
- state of tolerance and acceptance of the diversity of people
- recess between wars-and conflict—a coexistence
- The United Nations Department of Economic and Social Affairs (UN-DESA)
Sustainable Development Goal 16 (SDG 16) states that “promote peaceful and
inclusive societies for sustainable development, provide access to justice for all
and build effective, accountable . and inclusive institutions at all levels.”

● Peace Dividends
 - government is responsible for continued economic policy regardless of who is in
the administration

● Demographic Dividends
- defined by the United Nations Population Fund, is "the economic growth potential
that can result from shifts in a population’s age structure