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Political Env

PoliticalPhilosophy Ideologywhoprovidesgoods&servicescapitalism,socialism&communism. StructurehowisthegovtrunParliamentary,Republic,Monarchyetc. Authoritywhocontrolsdemocratic,totalitarianormix PoliticalInstitutions Constitutionfundamentalprinciples,rights&duties Legislatureenactslawsthatguidebusinessactivities. Executiveimplementsthedecisionsofthelegislatureandlaysdownpolicies,regulationsand proceduresthatinfluencetheactivitiesofbusiness. Judiciaryserversaswatchdogandtheirrulingsinfluencebusinesspractices.Itsettlesdisputes. PoliticalSystems Politicalparties Electionprocedure Govtstability Policies,Regulations,Programs&Incentives Others Relationshipwithothercountries Govttransparency,Bureaucracy,corruptionlevel,freedomofpressetc. Eventsoutsidethegovtcontrollikewar,revolution,terrorisms,laborstrikesetc. GovtpoliciesAffectthecost&certaintyofdoingbusiness.Economical,Monetary,Social,Welfare, Trade,Procurement GovtregulationsCapitalmarket,Competition,Pricing,Ecological,Investment,Export/Import GovtprogramsRuralelectrification,IndiraAawasYojana,MidDayMealScheme, GovtincentivesLoans,subsidies,taxbreaks

Govt - Business - Public Interface

Role of Business
Adherencetopolicies&regulations Employmentgeneration Participateinoveralleconomicgrowth Taxpaymentmajorsourceofincome. Provideproducts&services(Gotisalargepurchaser) Providinginformationtogovt&politicians. Governmentcontractshousing,infrastructure Governmentserviceslead/accompanydelegations,advisoryboards Voluntaryprogramsechoupal,drishti Politicalactivitydebates,NandanNilekaniUUID

Strategy PAC TradeAssociations

Description Organizationthatpoolscontributionsfrommembers&donates thosetocampaignfororagainstacandidateorlegislation.

Organizationfoundedandfundedbybusinessthatoperateina specificindustry. TheyparticipateinPRactivitiessuchasadvertising,education, politicallobbying. Mainfocusiscollaborationbetweencompanies.

Lobbying SIG EmployeeInvolvement

M&A JV

Role of Government
Theroleofthegovernmentshouldbetofacilitatetheprocessofpeoplesinvolvementindevelopment activitiesbycreatingtherightstypesofinstitutionalinfrastructure,particularlyinruralareas.Without organizedgovernment,individualcitizensandbusinesswouldoperatelikebeastsinjungle. Govtrolescanbeclassifiedasgeneral,provider&regulatoryroles

General Role
WithGeneralRolesgovtshouldfocusonmaintainingalegal/socialframeworkandahealthyeconomy& competitionamongbusinessentities.

Provider Role
PublicServicesAsaprovider,govtshouldprovidepublicserviceslikepostal,defense, parks/recreations,transportation,educationandpolice/fire. JobsGovtshouldalsoprovidejobs&workrelatedservicestosociety.Govtisalsoresponsible forformulatingappropriatelaborlaws&acts.GratuityAct,BonusAct,LaborAtcetc. BusinessGovtshouldprovidenecessarysupporttomembersofsocietytoenhance entrepreneurshipthroughloans,subsidies&taxincentives. InvestorGovtshouldprovideorestablishmechanismstogetcapitalforbusiness.Govtisalso responsibleforprotectingtheinvestmentmadebybusiness.

Regulatory Role
Governmentregulationofbusinessreferstoallmeasuresandinstrumentalitiesthatareaimedatdefining andlayingdownthelimitsofprivateenterprise,andcontrollingthevariouseconomicandbusiness activitiesinacountry. Appropriateregulatorypolicieshelpthegovernmentsto 1. Controlnaturalmonopolies 2. Controlnegativeexternalities 3. Achievesocialgoals 4. Controlexcessprofits 5. Controlexcessivecompetitions 6. Protectcustomers 7. Protectenv Athighlevel,governmentregulationscanbeclassifiedaseconomical&socialregulations.Economic regulationisdefinedasatypeofgovernmentregulationthatsetspricesorconditionsonentryoffirmsinto anindustry.Economicregulationalsoincludestheregulationoffinancialfirms.socialregulationincludes environmentalcontrols,healthandsafetyregulations,andrestrictionsonlabelingandadvertising.Social

regulationinvolvesthecorrectionofexternalities. Therearecertainbenefitsassociatedwithgovtregulations.Someofthemare 1. Fairtreatmentofemployees 2. Saferworkingconditions 3. Safer&qualityproducts 4. Cleanerair&water 5. Reasonableprice Theothersideofgovtregulationsare Directcostslikeexcessivecompliance&taxes. Indirectcosts Inducedcostslikereducedinnovation,reducedinvestmentinplant&equipmentsandincreased pressureonsmallbusiness. Overvaluedcurrency Hugetransactioncosts,bribery,redtapism Uncertainty Recenttrendistoincreasethesocialregulationwhereasreducetheeconomicalregulations.Themain purposeofthederegulationistoincreasecompetitionwiththeexpectedbenefitsofgreaterefficiency, lowerpricesandenhancedinnovation.Governmentsthroughouttheworldisfacingthedilemmaofhowto enhancethecompetitionwithoutsacrificingapplicablesocialregulations.

Public Policy
Guidelinesforpublicaction&mustbemanifestedinlaws,publicstatements,officialregulationsorwidely acceptedandpubliclyvisiblepatternsofbehavior.

Classification
Becausepublicpolicyisintentional,thatis,attemptstoachievecertaingoals,wecangrouppoliciesinto classificationsbasedonpurpose.

Membershipcitizenship&equality NeedsEducation,healthcareetc. SecurityGovernment,first,existstoprovidesecurityfrominternalandexternalthreatstothelives, liberties,andpropertiesofitsmembers.Defense&Foreignpolicies,Crimepolicy. Prosperitymaterialwellbeingofmembers.Economicalpolicy.

Distributivepoliciesallocatebenefitsfromgovernmenttocertainsegmentsofthepopulation.Subsidies, Cashpaymenttofarmers,publicschoolsetc.Themorewidelythebenefitsaredistributed,themore consensualthepoliciesandthemorepopularthepolicyislikelytobe.Distributivepoliciesaredesignedto affectonlyonespecificgroupofpeopleorsmallarea.Thesepoliciestendtobefairlylowcostand effective. Redistributioninvolvesnotonlytheallocationofbenefitsorservicestocertainpartsofthepopulation,but thetaxingofotherpartsofthepopulationtogeneratethefunds.Oldagepensions,scholarshipsetc. Redistributivepoliciestendtobeveryexpensiveinnature,andalsoseektomakeaverylargechange,or proposesomethingofanimportantnature. Regulatorypoliciesimposeconstraintsonindividualsandgroups.Theyreducelibertyofaction.Criminal justicelaws,speedlimits,envprotectionetc. Selfregulatorypoliciesaresimilartoregulatory,exceptthatthepersonsorgroupsregulatedpossess considerableauthorityanddiscretiontoformulateandpolicetheregulationsgoverningthem.Attorneys, physicians,engineers,andotherprofessions,forexample,receiveauthorityfromgovernmenttolicense practitioners,thusdeterminingwhomayandwhomaynotpracticetheprofession. CollectiveorPublicGoodsNationaldefense,cleanair,trafficcontroletc. PrivateGoodsdistribution&redistributionpoliciescomesunderthiscategory. http://voices.yahoo.com/fourtypesgovernmentalpolicieswhytheyare620599.html

Public Policy Levels

InternationalLevelTRIMS,TRIPS NationalMRTPAct RegionalLevelsharingriverwateramongriparianstates,CommonagriculturePolicy StateLevelPreventGroundwaterContamination,SH

Public Policy Process Stages

Identify the policy problems Agendasetting,thatis,decidingwhatistobedecided,isthefirstcriticalstepinthepolicymaking process.Togetontheagenda,problemsmustcometopolicymakersattention.Influentialindividualsand ordinarycitizens,organizedinterestgroups,thinktanksandpolicyplanningorganizations,political candidates,andofficeholdersallemploythetacticsofagendasetting,usuallythroughattemptstogetthe massmediatopublicizetheissue. Nondecisionmakingoccurswhenpowerfulindividuals,groups,ororganizationsacttosuppressanissue becausetheyfearthatifpublicattentionisfocusedonit,theirbestinterestsmaysuffer.NonDecision makingalsooccurswhenpoliticalcandidates,officeholders,oradministrativeofficialsanticipatethat powerfulindividualsorgroupswillnotfavoraparticularidea. Politicalideologyisadrivingforceinagendasetting. Specialinterestgroupsareastapleofthepoliticallandscape,andtheydotheirbesttoinfluencethe politicalagendaeitherdirectlyorindirectly.Specialinterestgroupsmayrepresentpeoplebasedonrace, ethnicity,gender,sexualorientation,age,income,profession,orotherfactors. MassmediaDecidingwhatisnewsandwhoisnewsworthyisapowerfulpoliticalweapon. Televisionexecutivesandproducersandnewspaperandmagazineeditorsdecidewhatpeople, organizations,andeventswillbegivenpublicattention. Publicopinion Formulate policy proposal Policyplanningorganizations,interestgroups,governmentbureaucracies,statelegislatures,andthe presidentandCongressmayallengageinformulatingpolicyproposals. Legitimize policy Policyislegitimizedasaresultofthepublicstatementsoractionsofgovernmentofficials,bothelectedand appointedthepresident,Congress,statelegislators,agencyofficials,andthecourts.Thisincludes executiveorders,budgets,lawsandappropriations,rulesandregulations,andadministrativeandcourt decisionsthatsetpolicydirections. Implement Policyimplementationincludesalltheactivitiesthatresultfromtheofficialadoptionofapolicy.Policy implementationiswhathappensafteralawispassed.Traditionally,publicpolicyimplementationwasthe subjectmatterofpublicadministration.Theseparationofpoliticsfromadministrationwasonce thoughttobethecornerstoneofascientificapproachtoadministration.Buttodayitisclearthatpolitics andadministrationcannotbeseparated.Opponentsofpoliciesdonotendtheiroppositionafteralawis passed.Theycontinuetheiroppositionintheimplementationphaseofthepolicyprocessbyopposing attemptstoorganize,fund,staff,regulate,direct,andcoordinatetheprogram.Ifopponentsare unsuccessfulindelayingorhaltingprogramsinimplementation,theymayseektodelayorhaltthemin endlesscourtbattles.Inshort,conflictisacontinuingactivityinpolicyimplementation.

Evaluate Formallyorinformallyevaluatedbypublic,massmedia,interestgroups,outsideconsultants&govt agencies.

Additional Notes
CapitalismPeopleowntheirownbusinessesandpropertyandmustbuyservicesforprivateuse,suchas healthcare.(US) SocialismGovernmentsownmanyofthelargerindustriesandprovideeducation,healthandwelfare serviceswhileallowingcitizenssomeeconomicchoices.(India) CommunismGovernmentownsallbusinessesandfarmsandprovidesitspeople'shealthcare,education andwelfare.(Cuba) ParliamentaryAparliamentarysystemisledbyrepresentativesofthepeople.Eachischosenasa memberofapoliticalpartyandremainsinpoweraslongashis/herpartydoes.(India) MonarchyAmonarchyhasakingorqueen,whosometimeshasabsolutepower.Powerispassedalong throughthefamily.(Jordan) TotalitarianRulebyasinglepoliticalparty.Peopleareforcedtodowhatthegovernmenttellsthemand mayalsobepreventedfromleavingthecountry.(China) DictatorshipRulebyasingleleaderwhohasnotbeenelectedandmayuseforcetokeepcontrol.Ina militarydictatorship,thearmyisincontrol.Usually,thereislittleornoattentiontopublicopinionor individualrights.(Iraq) TheocracyAformofgovernmentwheretherulersclaimtoberulingonbehalfofasetofreligiousideas, orasdirectagentsofadeity.(Iran) DemocracyInademocracy,thegovernmentiselectedbythepeople.Everyonewhoiseligibletovote whichisamajorityofthepopulationhasachancetohavetheirsayoverwhorunsthecountry.(India) TotalitarianRulebyasinglepoliticalparty.Votesforalternativecandidatesandpartiesaresimplynot allowed.Citizensareallowedand'encouraged'tovote,butonlyforthegovernment'schosencandidates. (NorthKorea) GovtStability Radicalshiftsingovtphilosophywhenopposingpoliticalpartiescomesintopower. Pressurefromnationalist&selfinterestgroups. Biasagainstforeigninvestment. Conflictsbetweenpoliticalparties.

Questions 1. Mentionsomeoftheinfluencesofstateonbusiness(3) 2. Whatexactlyistheregulatoryroleofgovtonbusiness(3) 3. Noteonpoliticalenv(3)

4. Howdoesthepoliticalenvinfluencethebusinessundertaking(10) 5. Writeadetailednoteoninterfacebetweengovt&business(10)