Tittle: Scottish Soldier. One of my current experiments of using CLIP STUDIO PAINT PRO. The comic-style with tones is tested at this time.
Saturday, December 05, 2020
Sunday, November 08, 2020
Market talks!
Monday, September 07, 2020
Transit from Dec. 2020 to Jan. 2021, The dramatic change in Finance, Politics, and Technology will start taking place.
* This analysis is based on an astrology so please kindly note that these following assumptions are not quite scientific and objective, and the variance of the error is significantly big. Thanks for your attention.
The inner cycle denotes the transitory chart of December, 2020 and the outer cycle denotes the transitory chart of January 2021.
The notoriously critical triple conjunction of Jupiter, Saturn, and Pluto has continued from the beginning of 2020 to now, and will continue until 2021 comes. Saturn temporarily left this conjunction in June, 2020, but came back there. In addition, when Saturn returned to the triple conjunction in the ascendant of Capricorn, Mars started crossing the ascendant of Aries, his own sign, and formed the square with that heavy triple conjunction.
This means that, the critical world socio-structural change started taking place in the beginning of 2020, and the aftermath effect has been perpetuated after both Saturn's return and Mars' own sign with their square. This seems to imply that the effect of ongoing wars against Corona-virus (COVID-19) and the fatal world socio-structural crises are being perpetuated together while this conjunction.
At the same time, Jupiter and Neptune (Together represents the financial well-being) has been forming a reasonably soft form, sextile, while this ultra hard aspect. This may indicate that the quantitative easing (QE) by various central banks in this world have propped up the other capital market such as the stock market.
On the other hand, both Jupiter and Saturn are passing away from the conjunction with Pluto crossing the ascendant of Capricorn meanwhile Mars is also finish crossing the ascendant of Aries. Then, Jupiter and Saturn start crossing the ascendant of the first degree of Aquarius together. At the same time, Mars starts forming a conjunction with Uranus crossing the ascendant of Taurus.
Remember that Taurus (Wealth and Stability) is a detrimental sign for Uranus (Innovation and Spontaneity). He forms a symbol of strife, Mars, and then form a square with Jupiter (Expansion and Wealth) and Saturn (Responsibility and Order&Stability), both of which represent a socio-structure. Even though these two structural symbols are overcoming from the conjunction with a symbol of fatality, Pluto, it looks like approaching a sudden drastic change in the world.
However, although the sextile of Jupiter and Neptune is cancelled off after this December, it does not mean to induce a hard aspect of them just after then. The end of the QE does not necessarily induce the hard situation. It may be hard for some such as those who cling to taking advantage of the status quo. (Jupiter and Saturn together just go away from the ascendant of Capricorn) We will need to find a new innovative and relatively riskier way not relying on static authority and norm. (Jupiter and Saturn start crossing the ascendant of Aquarius together while forming a square with the conjunction of Mars and Uranus which is crossing the ascendant of his detrimental sign Taurus)
Perhaps, we will see some sort of a solid answer or a solution for tackling against COVID-19 in the beginning of 2021 although some negative side effect remaining in the world. At the same time, the central banks will stop pouring their excess money supply into the world financial market, and the sharp economic downturn, which has been postponed by the QE programme, will suddenly emerge. The suddenness and sharpness are represented by the sudden change in the chart pattern just within one month as shown above.
The chart formation from January, 2021 also seems to introduce the prelude of the new era of Pluto starting to cross the ascendant of Aquarius after passing away from the ascendant of Capricorn because both the socio-structural symbols Jupiter and Saturn are simultaneously crossing the ascendant of Aquarius after passing away of Capricorn.
While Pluto is crossing the ascendant of Capricorn, the vertical relationship of human-beings such as the existence of nations and enterprises is fatally challenged. By contrast, while Pluto is crossing the ascendant of Aquarius, the horizontal relationship of human-beings such as the form of the relationship with the others and the entire society itself is fatally challenged.
Furthermore, this drastic transition is also about the shift from earth (subjective feminine) to wind (objective masculine). The emotional whim by populism and patriotist sentiment have been dominant recently whilst the more dry pragmatic sense will start replace it at a very fast pace in coming years. The recent development of information technologies and artificial intelligence will be accelerated furthermore, and dry rational pragmatism will frequently override emotionality and caring-sentiment. We must be prepared for everything as fast as possible because this transformation of the world is rapid as well as dramatic...!
Wednesday, August 26, 2020
Happiness related to Monarchy, One Party, and Democracy
Published on 12/07/2012 12:57 British Summer Time
Jeremy Bentham created an algebraic formula demonstrating the sum of utility derived from how national political system is structured. The algebraic formula is as follows:
Increasing the weight on one branch of these three decreases the weight on the other two branches. Bentham argued that the current (Contemporary) British system balances the weights among these three branches at the feasible level to maximise the utility.
Nonetheless, Bentham also insisted on abolition of sovereign = monarchy or dictator when his/her existence starts reducing the sum of utility rather than increasing it, and then the revolution shall be emerged. The coefficients of these variable, their sign (+/-), and their significance vary across different time, place (culture and civilisation), and occasion (GDP growth, etc).
At the contemporary time period when Bentham was alive, there was little objective ways to measure the sum of individuals' happiness in each nation in the world. By contrast, due to the development of the information technology, we have become able to collect some peer assessed numerical indices of various social scientific data sets. This happiness index is also collected by objective view points and survey methods under an academic peer assessment. Thus, it is interesting to assess Benthamite calculus owing to this world happiness index.
The data showing how the political system is structured in each nation in the world is quoted from "The Independent Map of the world in 2005". The binary variables are used as the indices to show how one nation's politics is structured e.g. Absolute Monarchy, One Party system, or Indirect/Direct Democracy. There is only one change from the original Benthamite algebra, which is that Aristocracy implies the executive member of a national legislature. As Bentham mentioned Aristocrats were those who have wisdom to govern, so it is equivalent to the government and bureaucratic elites. (He mentioned the House of Lord whose member is not elected from citizens. So, as the members of the legislature is directly appointed by an authoritarian legislation not by individual citizens) Then, many countries governed by one party technocratic policy is seen to be a pure aristocratic system. Absolute monarchy is assumed not to have any influential technocratic institution i.e. aristocracy. (Saudi Arabia and Morocco) whereas the constitutional monarchist nations have an influential parliament (E.g. Arab Emirates). All indirect democratic countries hold both Aristocracy = Technocratic Legislature and Democracy. They are still democratic but not the pure direct democracy. Only the nation seen to be a pure direct democratic is Switzerland in this analysis. Thus, the binary variable representing Monarchy is zero, the binary variable representing Aristocracy is 1, and the binary variable representing Democracy is 1.
**************** An important note ****************
The binary variables are usually 0 or 1, but there are some exceptions.
-> All the British Commonwealth nations have the binary variable denoting "Monarchy" that is 0.3 instead of either 0 or 1. These nations technically have a monarchy but s/he is not their own monarchy living in their countries, and his/her influence is not that strong as much as those nations having their own monarchy like Britain and Japan.
-> The "transient" democratic nations have the binary variable denoting "Democracy" that is 0.5 instead of either 0 or 1. It is still democratic but not a stable democracy. So, the effect of the variable "Democracy" is considered to be marginal.
**************** ***************** ****************
In addition, the Happy Planet Index (HPI) used as the dependent variable in this regression analysis is highly affected by the "natural climate" in these nations. Some nations in a certain latitude mark a significantly higher HPI than the others. Therefore, the absolute value of nation's latitude and its squared value, as the exogenous explanatory variables, are regressed on the HPI as same as the previously mentioned binary variables. The reason why the binomial function of Latitude, instead of a single variable (The linear function), is to demonstrate the parabolic function. The linear model (Regressing only on |Latitude|) only express either the right middle of equator or the North pole and the South pole are the happiest place to live. But, the HPI certainly shows that the optimum latitude to maximise the happiness is somewhere not far away from equator but not the zero latitude point.
All in all, the formula for the regression analysis is as follows:
*** The dependent variable is the natural log of the Happiness Planet Index (HPI) ***
The binomial function showing the climate effect (Latitude) is "the absolute value of Latitude + The squared value of Latitude".
In addition, there are the three binary variables. There are three binary variables showing the pure effect. The first one describes the pure effect of Monarchy. The second one describes the pure effect of Aristocracy. Then, the third one describes the pure effect of democracy.
The rest of variables are the binary variable denoting the interactive effect by two or three variables together. The interaction effect by "Monarchy" and "Democracy" is not assessed because there is no country having both monarchy and democracy without an aristocracy=technocratic executive branch.
The coefficients and their significance is as follows:
The coefficients of the variables showing the climate effect are 0.02256 for the coefficient of the absolute value of Latitude and -0.0004 for the squared variable of the latitude. Then, the formula shapes an upward parabola shown in the picture below.
Therefore, the place where the latitude is either +31 or -31 maximises the happiness of people living.
All the three binary variables denoting the single effect have a significant and positive coefficient. Both the interaction of Monarchy and Aristocracy and the interaction of Aristocracy and Democracy have a significant and negative coefficient. The coefficient of the interaction of all three variables is non-significant, so that the half of the coefficient value is used. The HPI derived from each different political structure is as follows:
This is a bar graph showing the policy effect on the H.P.I.:
These trends can be roughly visualised in a picture graph like this:
A nation with the direct democracy (Monarchy = 0, Aristocracy = 0, Democracy = 1 ) produces the highest HIP. But, Switzerland is the only nation with such a system in the world. So, it is not sure if it is still significant number of the sample to prove its superiority.
The absolute monarchist nations, (Monarchy = 1, Aristocracy = 0, Democracy = 0 ) is the second best. But, there are only Saudi Arabia and Morocco as the examples. Furthermore, all the other monarchist nations without any democratic structure (Monarchy = 1, Aristocracy = 1, Democracy = 0 ) showed the lowest HPI. Thus, it can be seen that, in general, monarchism without any degree of democracy is more likely to cause unhappiness rather than happiness.
The nations with one party system mark the second lowest HPI. Even though these nations are more efficient to be stablised than those lowest developed nations, the transient democratic nations, and any non-democratic monarchist nations. Nonetheless, they seem to sacrifice happiness for their stability.
Some of the constitutional monarchist nations with democracy seem to be happier than democratic republic nations. But, majority of the constitutional monarchist nations are less happier than democratic republic nations.
The democratic republic nations, though their democracy is indirect, such as the United States of America and France are the happiest nations next to Switzerland, the direct democratic nation.
All in all, Democratic Republican nations at the latitude of 31 or -31 seem to be the happiest ones. It also looks like that we can try to establish another Direct Democratic country because it looks like maxminising the happiness of individuals in a nation. Nonetheless, only the sample is Switzerland and it is never known if the similar model is applicable to increase the happiness in another country in reality. The democratic republic nations perform well among all. The performance of the constitutional monarchist nations with an indirect democracy varies.
Hence, this econometric analysis seems to be able to assist Jeremy Bentham having argued that, if monarchy start causing disutility rather than utility, then it is time for revolution! Perhaps, we have never known that there will be a revolution for the cause of Direct Democracy, the unknown ideal, in the near future? The Direct Democracy seems to maximise individuals' happiness at the optimum level (Though there is not enough number of the sample to prove in reality) by means of this statistic inference.
* It was difficult to find if the model creates heteroscedasticity: Some tests said no, but the other said yes. But, this analysis was mainly composed of the binary variables, and the dependent variable used in this analysis is not a precisely scientifically accurate variable. So, the aim of test should not be strict as much as the other econometric analyses.
Jeremy Bentham created an algebraic formula demonstrating the sum of utility derived from how national political system is structured. The algebraic formula is as follows:
Increasing the weight on one branch of these three decreases the weight on the other two branches. Bentham argued that the current (Contemporary) British system balances the weights among these three branches at the feasible level to maximise the utility.
Nonetheless, Bentham also insisted on abolition of sovereign = monarchy or dictator when his/her existence starts reducing the sum of utility rather than increasing it, and then the revolution shall be emerged. The coefficients of these variable, their sign (+/-), and their significance vary across different time, place (culture and civilisation), and occasion (GDP growth, etc).
At the contemporary time period when Bentham was alive, there was little objective ways to measure the sum of individuals' happiness in each nation in the world. By contrast, due to the development of the information technology, we have become able to collect some peer assessed numerical indices of various social scientific data sets. This happiness index is also collected by objective view points and survey methods under an academic peer assessment. Thus, it is interesting to assess Benthamite calculus owing to this world happiness index.
The data showing how the political system is structured in each nation in the world is quoted from "The Independent Map of the world in 2005". The binary variables are used as the indices to show how one nation's politics is structured e.g. Absolute Monarchy, One Party system, or Indirect/Direct Democracy. There is only one change from the original Benthamite algebra, which is that Aristocracy implies the executive member of a national legislature. As Bentham mentioned Aristocrats were those who have wisdom to govern, so it is equivalent to the government and bureaucratic elites. (He mentioned the House of Lord whose member is not elected from citizens. So, as the members of the legislature is directly appointed by an authoritarian legislation not by individual citizens) Then, many countries governed by one party technocratic policy is seen to be a pure aristocratic system. Absolute monarchy is assumed not to have any influential technocratic institution i.e. aristocracy. (Saudi Arabia and Morocco) whereas the constitutional monarchist nations have an influential parliament (E.g. Arab Emirates). All indirect democratic countries hold both Aristocracy = Technocratic Legislature and Democracy. They are still democratic but not the pure direct democracy. Only the nation seen to be a pure direct democratic is Switzerland in this analysis. Thus, the binary variable representing Monarchy is zero, the binary variable representing Aristocracy is 1, and the binary variable representing Democracy is 1.
**************** An important note ****************
The binary variables are usually 0 or 1, but there are some exceptions.
-> All the British Commonwealth nations have the binary variable denoting "Monarchy" that is 0.3 instead of either 0 or 1. These nations technically have a monarchy but s/he is not their own monarchy living in their countries, and his/her influence is not that strong as much as those nations having their own monarchy like Britain and Japan.
-> The "transient" democratic nations have the binary variable denoting "Democracy" that is 0.5 instead of either 0 or 1. It is still democratic but not a stable democracy. So, the effect of the variable "Democracy" is considered to be marginal.
**************** ***************** ****************
In addition, the Happy Planet Index (HPI) used as the dependent variable in this regression analysis is highly affected by the "natural climate" in these nations. Some nations in a certain latitude mark a significantly higher HPI than the others. Therefore, the absolute value of nation's latitude and its squared value, as the exogenous explanatory variables, are regressed on the HPI as same as the previously mentioned binary variables. The reason why the binomial function of Latitude, instead of a single variable (The linear function), is to demonstrate the parabolic function. The linear model (Regressing only on |Latitude|) only express either the right middle of equator or the North pole and the South pole are the happiest place to live. But, the HPI certainly shows that the optimum latitude to maximise the happiness is somewhere not far away from equator but not the zero latitude point.
All in all, the formula for the regression analysis is as follows:
*** The dependent variable is the natural log of the Happiness Planet Index (HPI) ***
The binomial function showing the climate effect (Latitude) is "the absolute value of Latitude + The squared value of Latitude".
In addition, there are the three binary variables. There are three binary variables showing the pure effect. The first one describes the pure effect of Monarchy. The second one describes the pure effect of Aristocracy. Then, the third one describes the pure effect of democracy.
The rest of variables are the binary variable denoting the interactive effect by two or three variables together. The interaction effect by "Monarchy" and "Democracy" is not assessed because there is no country having both monarchy and democracy without an aristocracy=technocratic executive branch.
The coefficients and their significance is as follows:
The coefficients of the variables showing the climate effect are 0.02256 for the coefficient of the absolute value of Latitude and -0.0004 for the squared variable of the latitude. Then, the formula shapes an upward parabola shown in the picture below.
Therefore, the place where the latitude is either +31 or -31 maximises the happiness of people living.
All the three binary variables denoting the single effect have a significant and positive coefficient. Both the interaction of Monarchy and Aristocracy and the interaction of Aristocracy and Democracy have a significant and negative coefficient. The coefficient of the interaction of all three variables is non-significant, so that the half of the coefficient value is used. The HPI derived from each different political structure is as follows:
This is a bar graph showing the policy effect on the H.P.I.:
These trends can be roughly visualised in a picture graph like this:
A nation with the direct democracy (Monarchy = 0, Aristocracy = 0, Democracy = 1 ) produces the highest HIP. But, Switzerland is the only nation with such a system in the world. So, it is not sure if it is still significant number of the sample to prove its superiority.
The absolute monarchist nations, (Monarchy = 1, Aristocracy = 0, Democracy = 0 ) is the second best. But, there are only Saudi Arabia and Morocco as the examples. Furthermore, all the other monarchist nations without any democratic structure (Monarchy = 1, Aristocracy = 1, Democracy = 0 ) showed the lowest HPI. Thus, it can be seen that, in general, monarchism without any degree of democracy is more likely to cause unhappiness rather than happiness.
The nations with one party system mark the second lowest HPI. Even though these nations are more efficient to be stablised than those lowest developed nations, the transient democratic nations, and any non-democratic monarchist nations. Nonetheless, they seem to sacrifice happiness for their stability.
Some of the constitutional monarchist nations with democracy seem to be happier than democratic republic nations. But, majority of the constitutional monarchist nations are less happier than democratic republic nations.
The democratic republic nations, though their democracy is indirect, such as the United States of America and France are the happiest nations next to Switzerland, the direct democratic nation.
All in all, Democratic Republican nations at the latitude of 31 or -31 seem to be the happiest ones. It also looks like that we can try to establish another Direct Democratic country because it looks like maxminising the happiness of individuals in a nation. Nonetheless, only the sample is Switzerland and it is never known if the similar model is applicable to increase the happiness in another country in reality. The democratic republic nations perform well among all. The performance of the constitutional monarchist nations with an indirect democracy varies.
Hence, this econometric analysis seems to be able to assist Jeremy Bentham having argued that, if monarchy start causing disutility rather than utility, then it is time for revolution! Perhaps, we have never known that there will be a revolution for the cause of Direct Democracy, the unknown ideal, in the near future? The Direct Democracy seems to maximise individuals' happiness at the optimum level (Though there is not enough number of the sample to prove in reality) by means of this statistic inference.
* It was difficult to find if the model creates heteroscedasticity: Some tests said no, but the other said yes. But, this analysis was mainly composed of the binary variables, and the dependent variable used in this analysis is not a precisely scientifically accurate variable. So, the aim of test should not be strict as much as the other econometric analyses.
Minimum wage is necessary to maintain free market economy (Monopsony)
When someone claims for imposing minimum wage, many may still tend to call this person a socialist. However, imposing minimum wage seems to be less socialistic than allowing politicised trade unions (labour unions) to hold their wage bargaining power. In order to preserve capitalist model based on free market market economy requires the reasonable level of regulation in order to sustain the fair rule of market competition, stable risk management of investment (attracting investment), symmetric information (mitigating information bias), and motivation of both employers and employees participating economy without being feared of mismatch (Rationally forming their contact with each other). Minimum wage can be considered as a form of regulation, and it provides a reason to say there is no need for a trade union intervening for avoiding exploitation of labourers.
Nowadays, involuntary unemployment and stagnating aggregate demand are still the significant socioeconomic problem. The root cause of the current economic structure seems to be the shrinking market competition due to growing power of major corporations. Unlike the earlier stage of capitalism, the current capitalistic model is more centralised and specialised in the hand of minority elite corporate executives and public bureaucrats working for the favour of these corporate elites. The market has become less competitive and less free due to this phenomenon, and the market is becoming less liquid than it used to be. Under this circumstance, it reduces the liberal wage/income bargaining of majority individuals owing to this asymmetric power balance.
In the free competitive market, the demand and the supply are more likely to meet at the equilibrium point, and the error from this equilibrium point is corrected by converging the price and the quantity to the equilibrium point. By contrast, due to the asymmetric balance of power mentioned in the aforementioned paragraphs, it is now diverging from the equilibrium point as the market becomes less competitive and the freedom of entering market is suppressed.
This graph shows how monopsony (Buyer holds power over seller). The labour market of the current capitalist economy is in this situation where the labourers (Selling their labour in the market) hold less power over their wage bargaining power whilst the employers (Buying the labour resource in the market) hold excess power.
The demand for labour can be also described as the average revenue from employing labour, and the average labour supply can be the average cost for employers for employing labour. The equilibrium point (Demand meets supply) is where the average revenue becomes equal to the average cost in the labour market. Then, the wage is set at both employers and employees (labourers) agree at the market competitive level, and the labour is employed where involuntary unemployment is reduced.
On the other hand, the most desirable point for the employer is not the equilibrium point because it does not maximise their profit for their business. Their desiring point is the level of the labour employed where the marginal revenue of hiring labour meets the marginal cost of hiring labour. At this point, employers use their influential power over the market to set the wage (their cost) lower than the equilibrium point so that they can maximise their profit. Only the labourers who are still willing to participate by using their labour in the market can be employed.
This situation pretty much explains why some labourers work way too long hours with unsatisfactory wage whereas there are many citizens unhappy to be employed. These unemployed citizens tend to be blamed for not willing to keep applying for a job. But, this is fault of not only them but also the market situation not able to afford the wage motivating them to work. In addition, already employed citizens suffer from the income shortage for propping up their cultural standard of living and for compensating their exhaustion from working.
The depreciated wage level caused by monopsony in the labour market induces the stagnation of the aggregate demand which represses the market multiplier, and this leads to the economic downturn. The aggregate supply level also eventually falls because the revenue from providing the supply declines due to the falling demand. Therefore, this monopsony has to be discouraged not only for majority citizens being employed in the labour market but also the capitalist citizens employing labourers. Some of these capitalist citizens will also start suffering from declining their activities.
Imposing minimum wage may overcome this situation of monopsony by raising the wage standard to the market equilibrium point. This will reduce the involuntary unemployment as well as stimulate the market multiplier. Reduced involuntary unemployment reduces the cost for public spending. It also increases the income of already employed citizens and reduces their frustration, and then this reduces the risk of suffering from mental disease so this also reduces the public spending cost. It will increase the aggregate demand induced by increasing the income level of majority citizens.
The typical counter-argument against minimum wage is that it sets the wage higher than the equilibrium point so it decreases the labour demand. However, the fundamental problem of the current situation is that wage is set at the considerably low enough to increase unemployment and repress the market multiplier.
At the same time, employers cannot be blamed for this situation because of the following reason. The current market economy is based on the specialisation in the global level and it requires the huge economic scale of production, and the model based on the competition among traditional small-medium sized enterprises is already an old fashioned way not able to survive in this current economic model. Therefore, it is inevitable that more selected numbers of corporations with stable fiscal situation and abundant experience, productivity, and net working survive to thrive whereas traditional small-medium sized firms suffer from their staggering business performance.
Instead of cracking down against these major corporations to revive the good old competitive market based on traditional small-medium sized firms, simply imposing the minimum wage is easier and more productive. The government intervention of reducing the power of major corporations will be costly, and will slow down the economy by sacrificing all the wisdom and virtues of major corporations. Therefore, it would be better to allow the current capitalist economic model to grow while reforming it for some optimisation.
This policy will improve the corporate structure of already existing firms. Successful corporations with good managements have enough revenue to cover the cost for minimum wage as long as it is set at the market equilibrium balancing the happiness of employers and labourers. This is also an effective tool to expel ethically misbehaving corporations which usually suffer from bad management with unstable fiscal situation. Then, unnecessary exploitation will be prevented.
This policy will also encourage work sharing among citizens. In the current economy, there are citizens working for excessively long hours. When this policy is implemented, works will be shared among more individuals, and their work and life balance will be optimised. Furthermore, it will encourage to replace some tasks relying on cheap labour with newly invented technologies such as automation by artificial intelligence (AI). There are still many firms hesitate to introduce the new technology optimising their business performances because clinging to relying on their cheap labour is still economical in the short run. All in all, this will be an opportunity to accelerate the innovation.
Having considered about monopsony in labour market, imposing reasonably high minimum wage bring aforementioned benefits. It is still questionable whether it can be ideally adjusted to the equilibrium point or it exceeds more than the equilibrium point. Nevertheless, this policy still seems to be worth off to try to implement in order to tackle with reducing involuntary unemployment and stimulating the market multiplier with relatively lower cost than the other government intervention.
Nowadays, involuntary unemployment and stagnating aggregate demand are still the significant socioeconomic problem. The root cause of the current economic structure seems to be the shrinking market competition due to growing power of major corporations. Unlike the earlier stage of capitalism, the current capitalistic model is more centralised and specialised in the hand of minority elite corporate executives and public bureaucrats working for the favour of these corporate elites. The market has become less competitive and less free due to this phenomenon, and the market is becoming less liquid than it used to be. Under this circumstance, it reduces the liberal wage/income bargaining of majority individuals owing to this asymmetric power balance.
In the free competitive market, the demand and the supply are more likely to meet at the equilibrium point, and the error from this equilibrium point is corrected by converging the price and the quantity to the equilibrium point. By contrast, due to the asymmetric balance of power mentioned in the aforementioned paragraphs, it is now diverging from the equilibrium point as the market becomes less competitive and the freedom of entering market is suppressed.
This graph shows how monopsony (Buyer holds power over seller). The labour market of the current capitalist economy is in this situation where the labourers (Selling their labour in the market) hold less power over their wage bargaining power whilst the employers (Buying the labour resource in the market) hold excess power.
The demand for labour can be also described as the average revenue from employing labour, and the average labour supply can be the average cost for employers for employing labour. The equilibrium point (Demand meets supply) is where the average revenue becomes equal to the average cost in the labour market. Then, the wage is set at both employers and employees (labourers) agree at the market competitive level, and the labour is employed where involuntary unemployment is reduced.
On the other hand, the most desirable point for the employer is not the equilibrium point because it does not maximise their profit for their business. Their desiring point is the level of the labour employed where the marginal revenue of hiring labour meets the marginal cost of hiring labour. At this point, employers use their influential power over the market to set the wage (their cost) lower than the equilibrium point so that they can maximise their profit. Only the labourers who are still willing to participate by using their labour in the market can be employed.
This situation pretty much explains why some labourers work way too long hours with unsatisfactory wage whereas there are many citizens unhappy to be employed. These unemployed citizens tend to be blamed for not willing to keep applying for a job. But, this is fault of not only them but also the market situation not able to afford the wage motivating them to work. In addition, already employed citizens suffer from the income shortage for propping up their cultural standard of living and for compensating their exhaustion from working.
The depreciated wage level caused by monopsony in the labour market induces the stagnation of the aggregate demand which represses the market multiplier, and this leads to the economic downturn. The aggregate supply level also eventually falls because the revenue from providing the supply declines due to the falling demand. Therefore, this monopsony has to be discouraged not only for majority citizens being employed in the labour market but also the capitalist citizens employing labourers. Some of these capitalist citizens will also start suffering from declining their activities.
Imposing minimum wage may overcome this situation of monopsony by raising the wage standard to the market equilibrium point. This will reduce the involuntary unemployment as well as stimulate the market multiplier. Reduced involuntary unemployment reduces the cost for public spending. It also increases the income of already employed citizens and reduces their frustration, and then this reduces the risk of suffering from mental disease so this also reduces the public spending cost. It will increase the aggregate demand induced by increasing the income level of majority citizens.
The typical counter-argument against minimum wage is that it sets the wage higher than the equilibrium point so it decreases the labour demand. However, the fundamental problem of the current situation is that wage is set at the considerably low enough to increase unemployment and repress the market multiplier.
At the same time, employers cannot be blamed for this situation because of the following reason. The current market economy is based on the specialisation in the global level and it requires the huge economic scale of production, and the model based on the competition among traditional small-medium sized enterprises is already an old fashioned way not able to survive in this current economic model. Therefore, it is inevitable that more selected numbers of corporations with stable fiscal situation and abundant experience, productivity, and net working survive to thrive whereas traditional small-medium sized firms suffer from their staggering business performance.
Instead of cracking down against these major corporations to revive the good old competitive market based on traditional small-medium sized firms, simply imposing the minimum wage is easier and more productive. The government intervention of reducing the power of major corporations will be costly, and will slow down the economy by sacrificing all the wisdom and virtues of major corporations. Therefore, it would be better to allow the current capitalist economic model to grow while reforming it for some optimisation.
This policy will improve the corporate structure of already existing firms. Successful corporations with good managements have enough revenue to cover the cost for minimum wage as long as it is set at the market equilibrium balancing the happiness of employers and labourers. This is also an effective tool to expel ethically misbehaving corporations which usually suffer from bad management with unstable fiscal situation. Then, unnecessary exploitation will be prevented.
This policy will also encourage work sharing among citizens. In the current economy, there are citizens working for excessively long hours. When this policy is implemented, works will be shared among more individuals, and their work and life balance will be optimised. Furthermore, it will encourage to replace some tasks relying on cheap labour with newly invented technologies such as automation by artificial intelligence (AI). There are still many firms hesitate to introduce the new technology optimising their business performances because clinging to relying on their cheap labour is still economical in the short run. All in all, this will be an opportunity to accelerate the innovation.
Having considered about monopsony in labour market, imposing reasonably high minimum wage bring aforementioned benefits. It is still questionable whether it can be ideally adjusted to the equilibrium point or it exceeds more than the equilibrium point. Nevertheless, this policy still seems to be worth off to try to implement in order to tackle with reducing involuntary unemployment and stimulating the market multiplier with relatively lower cost than the other government intervention.
The Political Compass by Country measured by Numerical Data
Published on 08/06/2019
The Political Compass inevitably relies on the author's subjective sense of judgement to measure where politicians/countries are located on each spectrum. Its author still uses the objective analysis to the certain extent as he seems to be an educated and well-informed academic. There are also various many derivational charts of political compasses invented by various individuals. However, majority seem to rely on the subjective measurement to determine how the selected policies are categorised in their chart.
This project is inspired by the Political Compass, and attempts to create a chart based on less relying on an author's subjective sense of judgement. So, the numerical data set is used to create this chart. The data were downloaded from the following sites:
Data Source:
Economic Freedom: https://www.heritage.org/index/download (2019)
Political Freedom: https://freedomhouse.org/report-types/freedom-world (2018)
By following the Political Compass, the X variable (The horizontal axis) indicates the economic freedom i.e. friendliness to free market capitalism. The way the economic freedom is measured turns to be notably different from the perspective of the Political Compass because the Heritage.org regards of the economic freedom and the development of the global capitalism as the positive optimistic element meanwhile the Political compass regards of them as relatively more oppressive and something not favoured by the mass. Yet, the main objective is to measure how each country adapts the free market global capitalism on the horizontal axis so that this does not induce it to be a significantly different analysis.
As same as the Political Compass, this chart also indicates the top side of the chart denotes more authoritarian, i.e. less politically free, and the bottom side denotes more liberal, i.e. more politically free. So, the Y variable (The vertical axis) is created by diverging the political freedom index. This is also not quit identical as what the Political Compass attempts to indicates. This index from FreedomHouse.org only ranks the countries' policies only by means of the relative measurement to the other countries in the current world situation: It compares them with neither historical examples nor the non-existent but maybe possible policies introduced in political theories.
Each variable is calculated as follows:
Both indices are powered by 0.3 in order to balance the chart (Making the candidates on the chart comparable and the chart more visible). 0.3 is used for the power because the average and the median of the variables become close to 0.5 together and the gap between the minimum and the maximum is widened by this calculus.
This chart was created by Microsoft Excel but it is not equipped with the chart label shown on the map of the chart. So, a chart-labelor was installed from www.appspro.com/Utilities/ChartLabeler.htm.
The dots of these countries are shaped and coloured dissimilarly by means of various diverse geographic and cultural regions. Unlike the original categorisation for the referred data sources, this chart scattered the original regional categories into more detailed unique ones. Western English speaking countries are categorised as Anglo-Saxon and Celtic on this chart (Blue Dia). Those in Asia-Pacific which are heavily influenced by Confucianism (Red Circle) are distinguished from the rest Asia-Pacific (Purple Circle). Those in Europe are roughly divided into three groups, West (Yellow Dia), Central (Pale Green Dia), and East (Pink Dia) in order to clarify the difference caused by historical and ethnic characteristics and the past as well as the present political factors. (It is by means of this author's subjective sense based on his knowledge because it is difficult to clear cut with a pure objective measurement)
This may help to compare and understand the economic and political attribute of various countries in a macro perspective.
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The Political Compass inevitably relies on the author's subjective sense of judgement to measure where politicians/countries are located on each spectrum. Its author still uses the objective analysis to the certain extent as he seems to be an educated and well-informed academic. There are also various many derivational charts of political compasses invented by various individuals. However, majority seem to rely on the subjective measurement to determine how the selected policies are categorised in their chart.
This project is inspired by the Political Compass, and attempts to create a chart based on less relying on an author's subjective sense of judgement. So, the numerical data set is used to create this chart. The data were downloaded from the following sites:
Data Source:
Economic Freedom: https://www.heritage.org/index/download (2019)
Political Freedom: https://freedomhouse.org/report-types/freedom-world (2018)
By following the Political Compass, the X variable (The horizontal axis) indicates the economic freedom i.e. friendliness to free market capitalism. The way the economic freedom is measured turns to be notably different from the perspective of the Political Compass because the Heritage.org regards of the economic freedom and the development of the global capitalism as the positive optimistic element meanwhile the Political compass regards of them as relatively more oppressive and something not favoured by the mass. Yet, the main objective is to measure how each country adapts the free market global capitalism on the horizontal axis so that this does not induce it to be a significantly different analysis.
As same as the Political Compass, this chart also indicates the top side of the chart denotes more authoritarian, i.e. less politically free, and the bottom side denotes more liberal, i.e. more politically free. So, the Y variable (The vertical axis) is created by diverging the political freedom index. This is also not quit identical as what the Political Compass attempts to indicates. This index from FreedomHouse.org only ranks the countries' policies only by means of the relative measurement to the other countries in the current world situation: It compares them with neither historical examples nor the non-existent but maybe possible policies introduced in political theories.
Each variable is calculated as follows:
Both indices are powered by 0.3 in order to balance the chart (Making the candidates on the chart comparable and the chart more visible). 0.3 is used for the power because the average and the median of the variables become close to 0.5 together and the gap between the minimum and the maximum is widened by this calculus.
This chart was created by Microsoft Excel but it is not equipped with the chart label shown on the map of the chart. So, a chart-labelor was installed from www.appspro.com/Utilities/ChartLabeler.htm.
The dots of these countries are shaped and coloured dissimilarly by means of various diverse geographic and cultural regions. Unlike the original categorisation for the referred data sources, this chart scattered the original regional categories into more detailed unique ones. Western English speaking countries are categorised as Anglo-Saxon and Celtic on this chart (Blue Dia). Those in Asia-Pacific which are heavily influenced by Confucianism (Red Circle) are distinguished from the rest Asia-Pacific (Purple Circle). Those in Europe are roughly divided into three groups, West (Yellow Dia), Central (Pale Green Dia), and East (Pink Dia) in order to clarify the difference caused by historical and ethnic characteristics and the past as well as the present political factors. (It is by means of this author's subjective sense based on his knowledge because it is difficult to clear cut with a pure objective measurement)
This may help to compare and understand the economic and political attribute of various countries in a macro perspective.
.
.
.
.
.
.
.
.
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