1 Essay Example | Topics and Well Written Essays - 10000 words

1 - Essay Example The economic theory dictates that the value of property is dependent on its demand. This also encompasses intangible property. According to Sople (2003), the brainchild of human intellect and wisdom is IP. IP is generally divided into two categories. Industrial property is that which encompasses patents, trademarks, industrial designs and geographic indications of source (WIPO 2010). On the other hand, copyright, the second class of IP, covers all literary and artistic works that are to be protected; copyright includes poems and plays, musical compositions, paintings, photographs and sculptures (WIPO 2010). The protection of IP is a major concern for policy makers. Countries like the US, Japan and the Netherlands attach great importance to the safeguard of IP. As discussed in detail in the following paragraphs, the protection of IP is important for economic growth and stability. Protection of IP also provides channels for the sustainment of technological advances, and in attracting investments in the country; this in turn leads to the creation of more jobs. The World Banks Global Economic Prospects Report for 2002 recongnized the growing importance of IP in the economic sector and how it is necessary for today’s globalized economies. It was observed in the report that â€Å"across the range of income levels, intellectual property rights (IPR) are associated with greater trade and foreign direct investment flows, which in turn translate into faster rates of economic growth† (Field 2008). For instance in the US, researches conducted over the last few years have established that about half of the exports are now dependent on the protection of IP, as compared to only 10% exports 50 years ago (Field 2008). At the national level, the system of intellectual property is regarded as one of the most important foundations of the current economic policy. Over the time, its importance has been recognized in sustainable development in

Monetary Policy and the Stock Market Dissertation

Monetary Policy and the Stock Market - Dissertation Example One financial instrument that is normally used by governments is the issuance of treasury bills or government bonds wherein the earning interest rates will generally be followed by the banks of that country. By using the interest rates that will define the treasury-bill holder’s earnings will slowly influence the financial market to adjust its interest rates. In the absence of other economic indicators, the treasury-bill interest rates will not only be adopted by the banks in their own financial transactions but it will also be used as the bench mark for the amount of money that will be available to borrowers. In theory, if the interest rates are low more people will borrow money from the banks. If the interest rates are high, the theory sustains that little to no borrower will loan money from the banks and most economic activity will be financed from in-house sources. Other instruments or means of conducting monetary policy includes making the government as the lender of last resort wherein the government will be the source of funds that will be available to borrowers normally a function provided by banks and other financial institutions. Another means of conducting monetary policy includes changing the reserve requirements in banks in order for them to operate. Another is where the government announces its intent to reduce or control inflation or by simply indicating the interest rates it wants for the money it intends to loan out. And last but not the least is moral suasions.... Meanwhile the true value of money is dependent on several factors such as the actual value of the goods that can be bought by the money or its value as compared with other currencies. However, given that these factors are also dependent on other economic indicators such as inflation and the volume of foreign currency reserve a country has, the correlation of the monetary policy of a country with its interest rates, stock market performance, and inflation will be explored by this paper. Monetary policy is implemented by increasing or decreasing the interest rates that is in theory would be able to inversely increase or decrease the supply of currency in circulation. In fine, the monetary policy of a country controls the amount or volume of currency in circulation to stimulate growth or maintain the stability of its economy. The primary onus of a government’s monetary authority is to create the optimal monetary policy that will stabilize prices for its basic commodities and enco urage investment. The trick however is how to make banks and other financial institutions follow the interest rates the government’s monetary authorities’ desires. One financial instrument that is normally used by governments is the issuance of treasury bills or government bonds wherein the earning interest rates will generally be followed by the banks of that country. By using the interest rates that will define the treasury-bill holder’s earnings will slowly influence the financial market to adjust its interest rates. In the absence of other economic indicators, the treasury-bill interest rates will not only be adopted by the banks in their own financial transactions but it will also be