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Regression Analysis of Business Statistics Report (Assessment)

Table of Contents Introduction Scatter diagram Correlation coefficient Relationship between the variable Regression Results Evaluation of regression model R-square value Regression equation Prediction Introduction Regression analysis is a statistical tool that is used to develop and approximate linear relationships among various variables. Regression analysis formulates an association between a number of variables. When coming up with the model, it is necessary to separate between dependent and independent variables. Regression models are used to predict trends of future variables. The paper carries out a simple regression analysis between the price of houses and the area of houses. Scatter diagram A scatter diagram is a graph that plots two related variables on a Cartesian plane. The independent variable is plotted on the x – axis while the dependent variable is on the y – axis. In this case, the price of houses (in thousands) is plotted on the y – axis while the area of houses (in square feet) is plotted on the x – axis. Scatter diagram tries to establish if there exists a linear relationship between two variables plotted on the diagram. This can be observed by looking at the trend of the scatter plots. Points on the scatter diagram tend to slope upwards. It is an indication of a positive linear relationship between the prices of houses and the area of houses in square feet. This implies that as the area of houses increases, the price also increases. Few points fall on the regression line drawn in the scatter diagram. There are several that fall outside the regression line. Further, there is a lot of concentration around 2000 square feet. This concentration affects the linearity of the model. This can be an indication of a weak regression line. A strong regression line is indicated by concentration of points along the regression line. Correlation coefficient The correlation coefficient is 0.6364. The coefficient is positive and greater than five. This implies that there is a positive linear relationship between price of houses and the area of a house. That is, as the area of the houses increase, the price of a house also increases. Get your 100% original paper on any topic done in as little as 3 hours Learn More Relationship between the variable There are a number of factors that affect the price of houses. A direct factor is the area of the house. However, that is not the only factor that affects the price of houses. Examples of these other factors include the location of the house and proximity to various social amenities. Only one factor will be used in this regression analysis thus yielding a simple regression. The dependent variable is the price of houses while the independent variable is the area of the houses (in square feet). The regression line will attempt to establish a linear relationship between price of houses and the area of the houses. A sample of twenty houses is used to estimate the regression equation. The regression line will take the form Y = b0 b1X Y = Prices (in thousands) X = Area (square feet) The theoretical expectations are b0 can take any value and b1 > 0. We will write a custom Assessment on Regression Analysis of Business Statistics specifically for you! Get your first paper with 15% OFF Learn More Regression Results The result of regression for each independent variable is shown in the table below. Variable Coefficients of the variable a0 Y – intercept 160.3961978 a1 Coefficient of area (in square feet) 0.066744981 From the above table, the regression equation can be written as Y = 160.40 0.0667X. The intercept value of 160.39619 is not dependent on the area of the house but on other factors such as the location of the house. The value captures all other factors that were not included when modeling the regression line. The coefficient value of 0.066744 implies that as the area (square feet) of the house increases by one unit, the price of the house will increase by 0.0667 units. The positive value of the coefficient implies a positive relationship between the price and area of houses. Evaluation of regression model Evaluation of the regression model can be done by testing the statistical significance of the variables. Testing statistical significance shows whether the explanatory variable is a significant determinant of the price of houses. A t – test will be used since the sample size is small. A two tailed t- test is carried out at 95% level of confidence. Null hypothesis: Ho: bi = 0 Alternative hypothesis: Ho: bi ≠ 0 The table below summarizes the results of the t – tests. Not sure if you can write a paper on Regression Analysis of Business Statistics by yourself? We can help you for only $16.05 $11/page Learn More Variable t – values computed t at α 0.05 Decision a0 Intercept 3.078114047 1.9432 Reject X1 Area (in square feet) 3.500704245 1.9432 Reject The null hypothesis implies that the variables are not significant determinants of demand. The alternative hypothesis implies that variables are significant determinant of demand. From the table above, the values of t – calculated are greater than the values of t – tabulated. Therefore, the null hypothesis will be rejected and this implies that the area (in square feet) is a significant determinant of the explanatory variable. Thus, area (in square feet) is statistically significant at the 95% level of significance. The value of the intercept is not relevant when testing the significance of the regression variables. Since the explanatory variable is statistically significant, it implies that the regression line can be used for prediction. The regression model shows that the slope is not strong enough though the regression coefficient shows a positive relationship between the prices and the area of houses. Thus, the model can be used in predicting the prices since as the price increases there is a corresponding increase in areas of houses. More variables should be added to the regression line so as improve on the regression equation. R-square value Coefficient of determination estimates the amount of variations of the dependent variable explained by the independent variables. A high coefficient of determination implies that the explanatory variables adequately explain variations the demand function. A low value of coefficient of determination implies that the explanatory variables do not explain the variations in price of houses adequately. For this regression, the value of R2 is 40.5%. This implies that the area (in square feet) explains only 40.5% of the variation in price of houses. It is an indication of a weak explanatory variable. Also, the value of adjusted R2 is low at 37.20%. The value of R2 can be improved on by adding more variables in the regression model. Regression equation The regression line is Y = 160.39619 0.06674X. Prediction From the regression line, prices of houses can be estimated. For instance, the regression line can be used to estimate the price of a house whose size is 3000 square feet. The computation of the price is shown below. Regression equation Y = 160.39619 0.06674 X The house price ($ 1, 000) = (0.0667 × House area (square feet)) 160.3962 = (0.0667 × 3, 000) 160.396 = 360.63114 = 360.63114 × 1, 000 = $360,631.14 A house of size 3,000 square feet house will cost $360,631.14.
Discussion week9.

Reform” Please respond to the following, using sources under the Explore heading as the basis of your response:Compare Erasmus and Luther in their attempts to bring about
religious reform. Consider the role of the printing press and the
actions of German princes in helping Luther to succeed. Next, identify
one (1) example of the Protestant Reformation’s impact on visual arts.
Pretend you are in a company or some other group in which you feel there
is corruption. (Use a real incident if you wish). You have the option
of remaining and working for reform from within, or of leaving and
hoping to start or land something new. Describe your decision and the
“dangers” of that decision, and describe the factors that you had to
consider.
ExploreReformChapter 17 (pp. 571-3), Erasmus; (pp. 573-7), Reformation and the
princes; (pp. 570-1; 579-580), printing press; (pp. 587-591), visual
arts; review Week 9 Music Folder
Week 9 Discussion Question Template
Discussion week9

Table of Contents Introduction Positive Externalities Types of Profit Externalities Conclusion References Introduction Externalities are the impact of economic entities participating in a particular transaction on third parties who are not involved in the deal. These are factors that are not taken into account when determining the gross national product but have an influence on people’s welfare. In order to analyze the effect of this phenomenon in more detail and to assess profit externalities, it is required to consider the classification of these economic components and what they are. Such a description will give an opportunity to assess the degree of their impact on the economic environment and help to determine if profit externalities can be useful for business. Positive Externalities Positive externalities are the beneficial effects of economic entities participating in the transaction of third parties. They are the utility that is not reflected in prices. According to Dragone, Lambertini, and Palestini (2014), with a positive external effect, marginal social utility exceeds marginal individual utility. Due to the fact that third-party external beneficiaries do not take part in the conclusion and execution of transactions with this commodity, their profits are not taken into account when concluding such transactions, and equilibrium prices and quantity established in the market differ from those that would be received in this manner. The result of positive external effects is the inadequate production and understatement of a certain product’s price, which leads to a decrease in the efficiency of the economy (Agafonow, 2014). Therefore, in order to ensure an effective output volume, a mechanism is necessary through which third parties, using the external effect, would contribute to its production and consumption. At the same time, one part of the contribution would be aimed at reducing the price paid by consumers in order to stimulate the growth of their consumption. The other part would be used to compensate for any increase in marginal costs in order to encourage producers to increase output. Types of Profit Externalities Profit externalities can be assessed from the point of view of their impact on economic activities by categorizing them. According to these groups, certain utility functions are performed, which should be taken into account when drawing up transactions. All the categories are relevant and may be applied to relevant financial activities. Based on specific principles of utility, market participants regard the importance of these externalities differently. The marginal individual utility of goods is the utility received by a person buying the additional unit of a specific product (Möhlmeier, Rusinowska,
Florida State U Role and Significance of Data and Data Analysis Exam Practice.

Midterm Take Home ExamWorth: 100 points.Due On or Before March 20, 2021 at 10:00 amInstruction: Download file. Please answer each of the following questions and show work/calculations. Open up sufficient space in the Word document. Insert you answer using a highlight color (blue, green, red). Please adhere to principles of academic integrity. Do not give or receive assistance or copy the work of another person. Do not communicate with other members of the class during the testing period. Do your own work. If you have questions contact the instructor.Good Luck.Question 1: Role and Significance of Data and Data Analysis Why is competency and proficiency in quantitative methods needed for public administrator managers and policy analysts? (3 points) What are the typical reasons or areas of interest that public administrators use data and engage in data analysis? (3 points)What are the four common sources of data? (4 points)Question 2: What is the logic model used in performance measurement? (10 points)Question 3: Key Definitions:Explain and define the differences between independent and dependent variables. Give examples. (2 points)Explain and define the differences between the statistical relationships “association” [correlation] and “causation”[causality]. Give examples. (2 points)Explain an experimental research design and a quasi -experimental research design. Which is the gold standard? ( 2 points)What is sampling error? (2 points)Why is random sampling preferred to purposive sampling? (2 points)Question 4: Central Tendency Definition: Name three measures of central tendency. Define each and give mathematical formula. (3 points) Application: For the set of data observations in the below table, calculate the three common statistics of central tendency (4 points)Interpretation/Judgement: Indicate under circumstances should when two of the statistics be used together and under what circumstances or with what kind of data or measurement scales should the least used central tendency be used. Give specific examples. (3 points)A.Data Observations B.Name of Central Tendency Statistic 1: ____Mathematical Formula_____Calculate using data in column AName of Central Statistic 2: _________Mathematical Formula____Calculate using data in column AName of Central Statistic 3: Mathematical Formula or definitionCalculate using data in Column A 8121313151734462713Question 5. Application: Data Transformation, Calculation, InterpretationUsing the community indicators dataset (file can be found on Blackboard, under Course Content, Subfolder Lectures and Database, Using the community Indicators dataset below, calculate the mean homicides rate per capita. To do this, will need to create a new variable homicide rate per capita for each city in the dataset, defined as homicides divided by population in a given city. Use Excel to calculate the mean homicide rates per capita. Which three cities have the highest homicide rates per capita. Are these the same cities with the largest absolute number of homicides in 2020? (3 points)As a policy analyst why might it be important and advisable to scale numbers or do relative comparisons as opposed to absolute calculations. If you were Police Czar for the entire country and had resources to allocate, where would you allocate the majority of resources if you wanted to have the most beneficial impact on residents? (2 points)(5 points).Show you your transformed data. City Number of Homicides 2020Estimated Population Homicide Per Capita Ranking AbsoluteRankingPer CapitaAtlanta, GA150420,003Baltimore, MD335620,961Virginia Beach, VA9437,994Virgin Islands (because of small population equal to a small town on mainland)49 104,440 St. Louis, MO261300,576Washington DC197601,723 Chicago, IL7482,695,598 San Jose, CA38945,942 Chula Vista, CA243,916 New York, NY4378,336,817Plano, TX2259,841Boston, MA57617,594Madison, WI10233,209Albuquerque, NM76545,852 Cities with highest per capita homicides 1. 2. 3. Cities with the highest number of homicides 1. 2. 3. Question 6: Graphing application: Visual Communication (10 points)Using the public perceptions survey, respondents reported as to how they feel the county has done balancing growth with environmental concerns. A mini dataset has been created from the Wang and Berman’s larger dataset just to answer this question. The variable of interest BALANCE, i.e perception of there is balance with growth and environmental policies. Note 1=Disagree 2-Agree and 3= Agree that there is balance. Variable BALANCEQuestion: Do you feel there is a balance between economic growth policies and environmental concerns in the county”Cases (respondents)BalanceCASE123456789101112131415161718192021222324252627282930BALANCE232332131222111223111223221212Please make a frequency distribution and insert here. Use Excel (5 points)Construct two bar charts, one that includes all three categories and one that omits the category “don’t know” (5 points). Insert your bar charts. Use Excel.Question 7: Application Equity Analysis and Graphing.For the graduation data presented in the table below please calculate mean, variance, and standard deviation for each of the schools (3 points) Produce a line chart for graduation rates for each school. Label graph with title, axis, and legend. (3 points)What is your interpretation of this data and chart? If you were the School Superintendent for the district that includes these two school what sorts of questions would this chart trigger in your mind? What additional investigation would you like to undertake? (4 points)Graduation Rates (Number of Graduates per Teacher) at Two Different SchoolsYearSchool A School B1193324325326324473251932MeanVarianceStandard DeviationQuestion 8: Definition and Application: ForecastingWhat is a forecast? (2 points)Why is it important to validate a forecast? How do you validate a forecast? (2 points)Using the data below use the forecasting technique of Prior Moving Averages (PMA) to forecast a budget three periods ahead (T+3) . Note the formula is to average three prior periods to get the present period. When you run out of actual values you included predicted values in your forecasting. (4 points) How did your forecast compare with actual budget values in periods T-2, T-1, and T? (1 point) (2 points)Year T-5T-4T-3T-2T-1TT+1T+2T+2Budget Constant $ (Actual)60.957.457.957.659.460.00Predicted Constant Budget?????? Question 9: What is the statistical property makes the standard deviation a desirable statistic? (10 points)Question 10: Application Interpretation To determine if you have normal standard distribution you can do tests of kurtosis and skewness or you can visually inspect a histogram and see in a symmetrical bell curve can more or less be superimposed.Plot the following data in a histogram and say whether or not you think it is a normal distribution. Try bins=auto, 3, and 6. Change bin size by clicking on chart—format—see bin dialogue box., change the bin number. Case Observation Value17727344418528632712849210811271256131914131516Clip and reproduce couple of your different histograms. What is you
Florida State U Role and Significance of Data and Data Analysis Exam Practice

Write an MLA styled, 800 word or more, rhetorical analysis of one of the articles listed on blackboard. Note that you are not being asked to tell me if you agree with the writer. Your task is to evaluate the writer’s use of rhetoric. In essence, you are e

Write an MLA styled, 800 word or more, rhetorical analysis of one of the articles listed on blackboard. Note that you are not being asked to tell me if you agree with the writer. Your task is to evaluate the writer’s use of rhetoric. In essence, you are e. I’m stuck on a Writing question and need an explanation.

Write an MLA styled, 800 word or more, rhetorical analysis of one of the articles listed on blackboard. Note that you are not being asked to tell me if you agree with the writer. Your task is to evaluate the writer’s use of rhetoric. In essence, you are evaluating how the writer writes and how the intended audience may receive the writer’s intended message, not whether or not you like her ideas.” WHY ACTIVISM GOOD FOR YOU ” SARAH CLANCY ARTICLE
Write an MLA styled, 800 word or more, rhetorical analysis of one of the articles listed on blackboard. Note that you are not being asked to tell me if you agree with the writer. Your task is to evaluate the writer’s use of rhetoric. In essence, you are e

GCU Collaborative Learning Community Pathophysiology & Nursing Management Presentation

research paper help GCU Collaborative Learning Community Pathophysiology & Nursing Management Presentation.

This is a Collaborative Learning Community (CLC) assignment.As a group, identify a research or evidence-based article published within the last 5 years that focuses comprehensively on a specific intervention or new treatment tool for the management of diabetes in adults or children. The article must be relevant to nursing practice.Create a 10-15 slide PowerPoint presentation on the study’s findings and how they can be used by nurses as an intervention. Include speaker notes for each slide and additional slides for the title page and references.Include the following:Describe the intervention or treatment tool and the specific patient population used in the study.Summarize the main idea of the research findings for a specific patient population. The research presented must include clinical findings that are current, thorough, and relevant to diabetes and nursing practice.Provide a descriptive and reflective discussion of how the new tool or intervention can be integrated into nursing practice. Provide evidence to support your discussion.Explain why psychological, cultural, and spiritual aspects are important to consider for a patient who has been diagnosed with diabetes. Describe how support can be offered in these respective areas as part of a plan of care for the patient. Provide examples.You are required to cite to a minimum of two sources to complete this assignment. Sources must be published within the last 5 years and appropriate for the assignment criteria and relevant to nursing practice.While APA style is not required for the body of this assignment, solid academic writing is expected, and documentation of sources should be presented using APA formatting guidelines, which can be found in the APA Style Guide, located in the Student Success Center. This assignment uses a rubric. Please review the rubric prior to beginning the assignment to become familiar with the expectations for successful completion. You are required to submit this assignment to LopesWrite. Refer to the LopesWrite Technical Support articles for assistance.
GCU Collaborative Learning Community Pathophysiology & Nursing Management Presentation

Systems Analysis and Design

Systems Analysis and Design.

Mini Case: Capstone Case: New Century Wellness GroupNew Century Wellness Group offers a holistic approach to healthcare with an emphasis on preventive medicine as well as traditional medical care. In your role as an IT consultant, you will help New Century develop a new information system.BackgroundYou began the systems analysis phase by conducting interviews, reviewing existing reports, and observing office operations. (Your instructor may provide you with a sample set of interview summaries.)The New Century medical team performs services and medical procedures, which are coded according to the American Medical Association’s Current Procedure Terminology (CPT). CPT codes consist of five numeric digits and a two-digit suffix, and most insurance payers require the codes to be included with billing information.The new system must be able to handle the new ICD-10 procedure coding system, which will be required by the Centers for Medicare & Medicaid Services (CMS) beginning October 1, 2014. ICD-10 codes consist of seven alphanumeric characters, which can be electronically transmitted and received. New Century’s information system must interface with 25 California health insurance providers. The new system represents an opportunity for significant cost saving for New Century, and more convenience for patients, who will be able to go online to update medical information, schedule appointments, and request medical records.During your fact-finding, you learned that the clinic requires various reports, as follows:Daily appointment list for each provider. The list shows all scheduled appointment times, patient names, and services to be performed, including the procedure code and description.Daily report call list, which shows the patients who are to be reminded of their next day’s appointments. The call list includes the patient name, telephone number, appointment time, and provider name.Weekly provider report that lists each of the providers and the weekly charges generated, plus a month-to-date (MTD) and a year-to-date (YTD) summary as well as profit distribution data for the partners.Monthly patient statement, which includes the statement date, head of household name and address, previous month’s balance, total household charges MTD, total payments MTD, and the current balance. The bottom section of the statement shows activity for the month in date order. For each service performed, a line shows the patient’s name, the service date, the procedure code and description, and the charge. The statement also shows the date and amount of all payments and insurance claims. When an insurance payment is received, the source and amount are noted on the form. If the claim is denied or only partially paid, a code is used to explain the reason. A running balance appears at the far right of each activity line.Weekly Insurance Company Report.Monthly Claim Status Summary.In addition to these reports, the office staff would like automated e-mail and text messaging capability for sending reminders to patients when it is time to schedule an appointment. Data also needs to be maintained on employers who participate in employee wellness programs. This information can be used for marketing purposes throughout the year. Finally, the new system needs to track employee schedules, attendance, vacation time, and paid time off.Now you are ready to organize the facts and prepare a system requirements document that represents a logical model of the proposed system. Your tools will include DFDs, a data dictionary, and process descriptions.Tasks(30 pts) Prepare a context diagram for New Century’s information system. (Follow the textbook standards for diagram. Please see Fig 5-12)(45 pts) Prepare a diagram 0 DFD for New Century (See Fig 5-13). Be sure to show numbered processes for handling appointment processing, payment and insurance processing, report processing, and records maintenance. Also, prepare lower-level DFDs for two numbered process. (Follow the textbook standards for diagram. Please see Fig 5-14)(25 pts) Prepare a list of data stores and data flows needed for the system. Under each data store, list the data elements required. (Please read section 5.6 carefully not to miss any items. Please note that you don’t need to use any special software to create this list)
Systems Analysis and Design

Economic Development Of Vietnam And China Economics Essay

China has been a remarkably successful economy since its adaptation of market-oriented reforms in 1978. The country’s real GDP growth has averaged about 9% each year from 1979 to the present (Naughton, 1995). Vietnam has also gone through a terrific economic development after the country’s transition process from centrally-planned economy to a market economy and it also gone from a poor to a middle-income country in just 20 years. This essay is devoted to give an overview how the gradualist path of economic reforms of the late 1970s and early 1980s affected both China’s and Vietnam’s economies and led to a high rate of development. I will analyze what factors made both countries to choose gradualism in contrast with Shock Therapy also known as Big Bang approach. While various scholars debate which approach leads to a better performance, I will demonstrate that in the case of China and Vietnam the gradualist approach turned out to be the more efficient one. Over the past five decades, East Asia has emerged as a region with several spectacular stories (i.e. Hong Kong, Singapore, Taiwan) of catch-up development. Both China and Vietnam have achieved remarkable economic growth since their economic reforms. Scholars (i.e. Popov, 2007) argue that the transformation of these two countries was caused by the adverse supply shock that resulted from deregulation of prices and change in relative price ratios that created the need for reallocation of resources in order to correct the industrial structure inherited from centrally planned economy. The end of Cultural Revolution in China in 1976 revived the two competing forces of institutional centralization and accelerated growth, which in contrast requires decentralization (Riskin, 1987). Two years later, in 1978, a plan of reform was adopted to deal with the imbalances in the economy. The transition strategy undertaken by China is termed a ”dual track” reform path because there is both a planned and a market part of the economy. In this dual track path, there was not only one single reform attempted at one time, but different programs were also tried simultaneously until the new reform measure could replace the old system. In the case of big-bang reform, the old system is usually destroyed before the new system takes place. Vietnam has gone through a similar transformation over the past 20 years and shifted its economy from a centrally planned economy to a Socialist-oriented market economy. In 1986 the government introduced a policy package which is often referred as economic reform (Doi Moi). It combined government planning with free-market incentives and encouraged the establishment of private businesses and foreign investment, including foreign-owned enterprises. Both countries began their economic development from their agriculture sector, and in both cases, their attempts to build a Soviet-style economy failed, during their pre-reform period (Vu, 2009) Today both countries are major players in the global economy, where Vietnam is the world’s leading exporter of pepper, seafood, rice, coffee (Backman, 2007) and China is the second largest economy in the world after U.S. One might ask, how both of these countries with a Communist government could achieve such high level of economic growth, hence in order to understand how their transformation led to today’s development, it is important to compare and contrast gradualism with shock therapy economic reform approaches. Big bang versus Gradualism A big bang or shock therapy approach implements various reforms on (monetary policy, privatization, trade and exchange rates etc.) quickly, whereas the gradualist approach spreads various reforms over an extended period of time. There are several arguments in support of big-bang approach to various types of reform. First, in the context of privatization, a big-bang approach provides a critical scale of privatized sector in the economy so that the privatized firms will be efficient (Roland and Verdier, 1992) Second, a big bang may increases the credibility of a reform (Lipton and Sachs, 1990) Third, the gradualist alternative gives time to reform opponents to organize themselves and thus invites a more formidable resistance (Krueger, 1993) In addition, in the context of price reforms, a gradual reform is undesirable, because it may induce an intertemporal speculation (van Wijnbergen, 1992). Finally, a big-bang approach brings the benefits more quickly (World Bank, 1991). On the other hand, there are various supportive arguments for a gradualist approach as well. The earliest statement in favor of this approach is from Confucius: ‘More haste, less result’. First, a gradualist approach may avoid excessive cost, especially for the government budget (Dewatripont and Roland 1992; Nielsen, 1993). Second, it avoids an excessive reduction in living standards at the start of a reform (Wang, 1992). Third, it allows trial and error and mid-course adjustment (World Bank, 1991). Fourth, it helps a government to gain incremental credibility (Fang, 1992). When the outcomes of reforms are uncertain to individuals, a gradual approach splits the resistance force and can thus increase the programs’ chance of surviving attacks by special interest groups (Rodrik, 1990). Gradualist approach to reform can be defined as a sequential implementation of minimum bangs (terminology from Williamson, 1991). A minimum bang is a simultaneous implementation of a minimum set of reforms that can be implemented independent of other reforms without failure. It is important to note though that, even across a set of minimum bangs, a gradualist approach may not always be better than a big bang. A reform program may not be able to overcome political resistance, if it is implemented by shock therapy, but it may become politically viable if it is implemented by a gradualist approach. Friedman and Johnson (1995) argued that in the presence of complementarities between government policies and enterprise attributes and convex adjustment costs for enterprises (i.e. costs increasing with the speed of reforms) radical shock-therapy reforms might not necessarily be optimal. Countries that chose to follow the big bang approach, found themselves in a supply-side recession, where the excessive speed of change in relative prices required the magnitude of restructuring that was simply non-achievable with the limited pool of investment. The speed of adjustment and reallocation of resources in every economy is limited, if only due to the limited investment potential needed to reallocate capital stock. This is one of the main rational for gradual, rather than instant, phasing out of tariff and non-tariff barriers, of subsidies and other forms of government support of particular sectors. This can be used as a powerful argument against shock therapy, especially when reforms involved result in a sizable reallocation of resources. It is also important, that the pace of liberalization had to be no faster than the ability of the economy to move resources from non-competitive to competitive industries. Differences in performance during the initial stage of transition depend strongly on the initial conditions and external trade patterns. In addition, changes in the institutional capacity of the state have dramatic impact on performance. Economic reforms in China and Vietnam after the pre-reform period It is definitely the strong institutional framework that should be held responsible for the success of gradual reforms in China and Vietnam, where strong authoritarian regimes were preserved and centrally planned economy institutions were not dismantled before new market institutions were created. The shock-therapy approach was not desired by China, because of its radical reform programs, therefore the gradualist approach was more likely to be successful, due to China’s under-developed and under-industrialized economy with a large rural surplus of labor force. China’s economic reforms can be divided into separate eras. The first one, which extends from Deng Xiaoping’s 1978 “opening and reform” to the early 1990s, the Communist Party emphasized rural development with relatively little interference from above, where the result was an explosion of small- and medium-sized businesses that created an enormous rise in employment and wealth. Deng created his first “special economic zones” in places along the coast, such as Shenzhen, where there was relatively little established industry. So the new companies that sprang up there were almost entirely private. Foreign investors piled in, but mostly under conditions that did not disadvantage local entrepreneurs. Outcome: everyone got rich together. Centrally planned economy was no longer viable in China; therefore changes were required to promote economic growth. Consequently, without a definite model in mind, China underwent a lengthy path of adjusting reform objectives from a planned economy with some market adjustment to a combination of planned and market economy to a socialist market economy. In Vietnam, economic reforms started in 1986 and they resembled very much Gorbachev-type marginal reforms in the same period. Vietnamese authorities have reaffirmed their commitment to economic liberalization and international integration. They have moved to implement the structural reforms needed to modernize the economy and to produce more competitive export-driven industries. In both Vietnam and China the economic reforms were initiated under certain circumstances that provided three critical factors for change: receptivity, crisis and opportunity (Vu, 2009). During their pre-reform period (China: 1953-1978; Vietnam 1954-1986) [1] they made extraordinary efforts to build their socialist economies, but they experienced failure rather than success. China was impoverished by the Cultural Revolution, while the Vietnamese economy was ruined by the collectivization of land, nationalization of privately owned industrial and trading establishments and socialist ideology-driven initiatives (Vu, 2009). Reforms became possible because of various internal and external factors in both countries. In China, the death of Chairman Mao in 1976 paved the way for Deng Xiaoping and his economic reforms, while in Vietnam, the radical reform programs launched by Gorbachev in 1985 in the Soviet Union, which was then Vietnam’s role model for economic development as well as its main provider of aid, to some extent were an inspiration for the Vietnamese leadership. Fforde and Vylder (1996) observed that the similar circumstances leading to reforms in China and Vietnam are behind the fact that the reforms in both countries were more economic than political. While the reforms in China and Vietnam were initiated under the pressure of economic despair and the need of finding a new way to recover the economy, the main concern of the leadership in both countries was to maintain political stability and the absolute power of the Communist Party. As a result, to justify the legitimacy of the political system, both countries chose a gradualist approach to reform with a special focus on economic growth. A big bang approach and a possible unsuccessful outcome of a reform could have destroyed the parties’ credibility and led to an up rise within the country, of what the regime would not have survived, so the two countries had no other choice than introduce new economic reforms only step by step. This gradualist approach addressed the ‘easy’ problems first and left the hard ones for later. A radical approach (big bang) would aim to maximize efficiency gains and minimize the political costs of reform. The ‘pacing and sequencing’ method of the gradualist approach gained popularity in both countries at the expense of advocating for immediate liberalization. One important feature of reforms is that people are not sure usually whether they are necessarily gainers or losers of a certain reform, therefore I believe that a gradualist approach may be politically more sustainable than the big bang approach, because it splits the resistance force and allows uninterrupted political support for the reform. On the other hand, if a reform program is strong at the start and well supported by the public, then a shock therapy approach is better both because it brings the benefits faster and because it is politically preferred to various schemes of partial or gradual reforms. There are of course other factors as well (export oriented industrial policy) that contributed to the rapid growth of these Asian transition economies and not just gradualism. Conclusion It is clear to see by now, that both countries went through huge changes in their economies in the past 20-30 years. The Communist leadership was able to maintain their power, but also open up more and create a unique socialist-market economy, where the state still owns the major industries such as telecommunications, national railroads, airlines and power. While there is only one direction for both China and Vietnam – more economic reform and liberalization – the Communist Party of these governments will certainly not tolerate any challenge to their power. They want economic change but not political one. While the two countries initiated their economic reforms from comparable economic and social conditions and have rather followed similar approaches to reform and economic management. Since the launch of these reforms, both countries have made impressive achievements in their growth performance; however their growth patterns have significantly diverged. China has far outperformed Vietnam in both the pace and the efficiency of growth. I don’t think that there is need for comparison though, when both their historical and economic backgrounds, prior to the reforms, were different and also given the size of the two countries, China surely has an advantage due to its huge population. It is also important to keep in mind that while China has an advantage in government effectiveness, its institutional foundation remains weak, which is rather comparable with Vietnam. One of the issues that I found during my research is that in making comparative analysis between the shock therapy and gradualist approach, the country cases for big bang outnumber the countries that followed a gradual path and succeeded. China and Vietnam seem to be the only ones in comparison with a great amount of other transitional economies that followed the big bang approach. In this regard, the investigation of other similar cases following the gradual approach would be worth studying to have a better understanding and also a more accurate comparative analysis on different transitional paths adopted among different transitional economies. References: Backman, Michael. “Chapter 16 – Is Vietnam the New China.” Asia Future Shock: Business Crisis and Opportunity in the Coming Years. Basingstoke: Palgrave Macmillan, 2008. pages 110-118 Dewatripont, M., and G. Roland (1992) ‘The virtues of gradualism and legitimacy in the transition to a market economy.’ Economic Journal 102, 291-300 Fang, Xinghai (1992) ‘Economic transition: government commitment and gradualism.’ Working Paper, Stanford University Khuong M. Vu. “Economic Reform and Performance: A Comparative Study of China and Vietnam.” China: An International Journal 7.2 (2009): 189-226. Project MUSE. 15 Apr. 2010 Krueger, Anne 0. (1993) Political Economy of Policy Reform in Developing Countries (Cambridge, MA: MIT Press) Lipton, D., and J. Sachs (1990) ‘Creating a market economy in Eastern Europe: the case of Poland,’ Brookings Papers on Economic Activity 1, 75-147 (1990) Naughton, Barry. Growing out of the Plan: Chinese Economic Reform, 1978-1993. New York, NY: Cambridge UP, 1995. Riskin, Carl. China’s Political Economy: the Quest for Development since 1949. Oxford [Oxfordshire: Oxford UP, 1987. Roland, Gerard, and Thierry Verdier (1994) ‘Privatization in Eastern Europe: irreversibility and critical mass effects.’ Journal of Public Economics 54(2), 161-83 Rodrik, Dani (1990) ‘How should structural adjustment programs be designed, World Development 18, 933-47 Van Wijnbergen, S. (1992) ‘Intertemporal speculation, shortages and the political economy of price reform.’ Economic Journal 102, 1395-406 Vladimir Popov, 2007. “Shock Therapy versus Gradualism Reconsidered: Lessons from Transition Economies after 15 Years of Reforms1,” Comparative Economic Studies, Palgrave Macmillan Journals, vol. 49(1), pages 1-31, Wang, Yijiang (1992) ‘East European puzzle and Chinese enigma: institutional changes as a resource allocation problem.’ Paper presented in Anaheim, January 1993. Working Paper, University of Minnesota World Bank (1991) World Development Report 1991: The Challenge of Development (New York: Oxford University Press) http://www.arts.usask.ca/economics/skjournal/sej-3rd/Lynden.htm Accessed: 05.01.2010 http://dspace.anu.edu.au/bitstream/1885/40425/1/cu99-5.pdf Accessed: 05.03.2010

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