Impact of Demand and Supply Forces in the Market

Impact of Demand and Supply Forces in the Market In general, equilibrium market price is determined by where quantity demanded meets quantity supplied. This holds true for the property market in the UK, where prices are being driven by large demand for housing and an almost fixed supply of property. This larger demand of housing over existing supply has been the main factor driving UK property prices up in the last 10 years. However, these increased prices cannot last forever, the market (through changes in supply and demand, as well as government intervention) will find a new equilibrium due to factors that will bring demand down again. According to demand and supply theory, for a downward sloping demand curve, as price increases, quantity demanded moves leftward along the demand curve, resulting in a lower quantity demanded. On the other hand, in an upward sloped supply curve, as price increases, then quantity supplied moves rightwards along the supply curve for a higher quantity supplied. In the case of the UK housing market, let’s suppose we had a downward sloping demand and upward sloping supply, which intersected at P0 and Q0. About 10 years ago, the UK economy was starting its upwards growth cycle. This gave people more money which they could freely spend on purchasing property, increasing demand for housing. This increased demand caused the demand curve for property to shift outwards from D0 to D1. With this increase in demand, and the same supply curve S0, prices would have increased from P0 to P1 and quantity demanded and supplied would have increased from Q0 to Q1. However, this increase in demand which caused higher prices would also affect supply, so more builders and developers would want to construct housing in order to fulfil this growing demand. Yet, this increase in supply is always smaller than the increase in demand because of resource constraints—where will you actually build new housing and the time it takes to build such once you have found a place to do so and also because the builders know that others will be building too and so the increased price will not be as high as they initially saw. In the end, the total increase in supply is smaller than the increase in demand. This increase in supply (which takes a bit longer to be reflected in the market than the increase in demand) would imply an outwards shift of the supply curve from S0 to S1. This in itself would then reduce prices from P1 to P2 and increase quantity even more from Q1 to Q2. Since the increase in supply is not enough to offset the increase in demand, the cycl e begins again with another outward shift in demand, since those demanding Q2 at the lower price P2 are willing to pay up to P3, driving demand out again and helping the boom in housing prices. In reality, this increased demand and supply is continuously occurring and the process cannot be explained by the diagrams above. Some believe that part of the real reason why prices are so high right now is because people are buying based on how prices have been behaving and are not arbitraging: instead of correcting each others mispricing, they reinforce it. (Farlow 2004) However, in the future, demand for housing could become lower than supply, which would mean that prices would go down. Given the high prices to date, more developers are building new housing which would imply that supply is increasing. If this continues or even grows, then supply could at one point exceed demand, driving prices downwards. This is unlikely, as when builders are making decisions as to whether or not create new homes they factor in the supply of housing being built by their competitors, which sometimes causes the overall growth in supply to be lower than what some expected. Another factor that could influence a price crash is an economic recession, whereby many people are laid off and their disposable income is reduced. Were this to happen, then demand for property would decline, and again, prices would have to reduce to accommodate the lower demand. A third factor that could influence is if the government increased interest rates dramatically. In this case, the increas e in interest rates would result in two main issues: reducing consumer spending, which would include buying property, in favour of saving money, as savings rates would increase, and secondly, a reduction of people wanting to borrow money for properties, as mortgages would go up. This two-way reduction would also reduce demand for property, with a result of a reduction in property prices. As we have seen above, demand and supply forces can be used to explain how it is possible to get such a continued increase in the prices of UK housing over the last 10 years, beginning with a strengthening of the economy which injected cash into the market. This led to increased demand for housing which was not offset by identical increase in supply, which combined with continued economic growth and low interest rates just continued putting upward pressure on demand for housing and thus increasing prices. There have been many recent articles wondering when this upwards spiral will end but it is difficult to predict. The Bank of England has been trying to intervene by increasing interest rates in the last few months with yet another increase predicted in the near future, but this is not reflecting in a reduction for housing demand. A big factor that could help reduce property prices is a reduction in the overall economy, as occurred in the 1980s, when unemployment hit certain areas an d many were left with little income for buying homes. This, however, does not seem likely, given the pressure to maintain the economic boom. However, there will come a point when the majority of people will be unable to afford any housing due to its continuous price increases, driving demand for housing down. REFERENCES Farlow, A., 2004, â€Å"Part two: The UK Housing Market: Bubbles and Buyers†, Credit Suisse First Boston. Lipsey, R.G. and K.A. Chrystal, 1999, Principles of Economics, 9th edition, Oxford: Oxford University Press.

Jonathan Glover Essay

Jonathan Glover (born 1941) is a British philosopher known for his studies on ethics. He was educated at Tonbridge School, later going on to Corpus Christi College, Oxford. He was a fellow and tutor in philosophy at New College, Oxford. He currently teaches ethics at King’s College London. Glover is a fellow of the Hastings Center, an independent bioethics research institution in the United States. Glover’s book Causing Death and Saving Lives, first published in 1977, addresses practical moral questions about life and death decisions in the areas of abortion, infanticide, suicide, euthanasia, choices between people, capital punishment, and war. His approach is broadly consequentialist, though he gives significant weight to questions of individual autonomy, the Kantian notion that we ought to treat other people as ends in themselves rather than merely as means. He criticises the idea that mere consciousness or life itself are intrinsically valuable: these states matter, he argues, because they are pre-requisites for other things that are valuable and make for a life worth living. There is, then, no absolute sanctity of human life. [1] He criticises the principle of double effect[2] and the acts and omissions doctrine,[3] the notion that there is a huge moral difference between killing someone and intentionally letting them die. In his discussion of real cases of moral decisions about killing he draws on insights from history and literature as well as philosophy. Throughout, the emphasis is on the consequences of moral choices for those affected, rather than on abstract principles applied impersonally. In Humanity: A Moral History of the Twentieth Century, published in 1999, Glover considers the psychological factors that predispose us to commit barbaric acts, and suggests how man-made moral traditions and the cultivation of moral imagination can work to restrain us from a ruthlessly selfish treatment of others. Gaining greater understanding of the monsters within us, he argues, is part of the process of caging and containing them. [4] He examines the various types of atrocity that were perpetrated in the 20th century, including Nazi genocide, communist mass killings under Stalin, Mao, and Pol Pot, and more recent slaughter in Bosnia and Rwanda, and examines what sort of bulwarks there could be against them. He allows that religion has provided bulwarks, which are getting eroded. He identifies three types of bulwark. The two more dependable are sympathy and respect for human dignity. The less dependable third is Moral Identity: â€Å"I belong to a kind of person who would not do that sort of thing†. This third is less dependable because notions of moral identity can themselves be warped, as was done by the Nazis. [5] In The End of Faith, Sam Harris quotes Glover as saying: â€Å"Our entanglements with people close to us erode simple self-interest. Husbands, wives, lovers, parents, children and friends all blur the boundaries of selfish concern. Francis Bacon rightly said that people with children have given hostages to fortune. Inescapably, other forms of friendship and love hold us hostage too†¦ Narrow self-interest is destabilized. â€Å"[citation needed] In 1989 the European Commission hired Glover to head a panel on embryo research in Europe. [6] He is married to Vivette Glover, a prominent neuroscientist. Jonathan is father to three and grandfather to one (father to Ruth, Daniel and David Glover and grandfather to Samuel Glover).

Creating a World Beyond Reality Essay

In Azar Nafisi’s â€Å"Selections from Reading Lolita in Tehran†, Nafisi and her students, rather than denying the reality that they live in, created a world alternate from their reality. In their physical world the government has stripped them of their individualism. They were unable to act or do as individuals would, thus they went to the book club as a way to escape reality. It gave them insight into a world they could not experience. Literature becomes their color in their bleak world of black and white restrictions. They came to the realization, through their readings, that they had given their government the power to take away from them their individuality. They created a fictional world to let them be individuals and escape the restrictions that their physical environment placed upon them. With this fictional world, they rebelled against their government and used it as a way to escape their harsh reality. Possessing their fictional world allowed them to remain unique individuals. Fiction can express truth as effectively as reality. The way someone views reality can be their own fiction. Nafisi and her students did not use fiction as a way to deny their reality but instead it opened up a window of many minds other than their own. They learn from fiction just as much if not more than they do with reality. Fiction brought them realities they never would have been able to be aware of in their physical world â€Å"She fashions her universe not through physical force, as does the king, but through imagination and reflection† (Nafisi 259). They learn through fiction that they have one thing that the Revolution did not and could not take away from them, their imagination They learn that with their imagination it makes them each their own unique person. Fiction helped them realize more about themselves and more about reality. Their situation is similar to the character of that book, although they cannot do anything to chance their lives through force, they have their imagination and that itself is enough to make a differences for themselves. Furthermore, Nafisi and her students enabled themselves to experience new worlds by exposing themselves to different realities from the books they read. Instead of denying they are now aware of other worlds beyond their own. â€Å"do not, under any circumstances, belittle a work of fiction by trying to turn it into a carbon copy of real life: what we search for in fiction is not so much reality but the epiphany of truth† (Nafisi 248). They did not try to hide reality with their created world, only to better their state of mind by allowing themselves the freedom to think as individuals. Nafisi did not want the purpose of this book club to make her students try to live the realities of the books, she wanted to make them aware of realities that they are unable to experience physically. Their government has suppressed them and they are not allowed any individuality so the purpose of the book club enabled them â€Å"to experience how the ordinary pebble of ordinary life could be transformed into a jewel through the magic eye of fiction. † (Nafisi 252). The only way they can get away from their dull lives is through this book club. By reading, it brightens their lives in way they could never be able to do on their own. Their fictional creation allows them to be individuals and escape restrictions that their physical environment has on them. In the book club, Nafisi and her students are given â€Å"the possibility of a boundless freedom when all options are taken away† (Nafisi 262). They find a way to be stay their real unique selves through their learning. â€Å"Reality has become so intolerable, she said, so bleak, that all I can paint now are the colors of my dreams† (Nafisi 253). The book club is the only way they can get a break from their reality. It helps the girls keep their distinct selves. Dreams are something the government cannot take away from someone, just like their created world they still have something personal left of them. â€Å"acts of writing are his means of escape. He is a hero because he refuses to become like all the rest. † (Nafisi 262). Their fictional world is some place for the girls to flee to. Reading the writing helps them see things from a different perspective they are unable to encounter, the story they create is their fantasy and thats what keeps them individuals. The Revolution is trying to mold them into people they want them to be, while they are creating themselves. The government is trying to control their reality and their fiction. Nafisi and her students are rebelling against their government not only by attending this book club but with the creation of their fictional world. Their fictional world opens up their minds and empowers them to exercise their right to be able to think how they wish to. That is something the government tried but could not take away from them. Nafisi and her students are not denying their reality by creating this world of theirs, they have accepted it in order to build a barrier around themselves from that reality. â€Å"An absurd fictionality ruled our lives. We tried to live in the open spaces, in the chinks created between that room, which had become our protective cocoon and the censor’s world of witches and goblins outside† (Nafisi 264). The veil they are forced to wear, is a symbol of fictionality because the Revolution is forcing everyone to pretend to be someone who they are not. The book club is a safe haven for their individuality. It protects their different characteristics from the government. With their fictional world, they are going against the government and not letting their authorities oppress them. â€Å"These girls, my girls, had both a real history and a fabricated one† (Nafisi 265). Keeping both worlds is an act of rebellion against government who tried to make them conform to the real standards of their society. â€Å"Is she aware, Sanaz, of her own power? Does she realize how dangerous she can be when her every stray gesture is a disturbance to public safety? † (Nafisi 265). They are the only ones who have control over how and what they think. By creating this fictional world they are making changes against the government. â€Å"where we simultaneously invented ourselves and were figments of someone else’s imagination† (Nafisi 263). Nafisi and her students are living through the stories they read, like being the characters that they created, it makes them stronger, inspires them. Fiction has become a coping mechanism for them, giving them stronger will to deal with reality. â€Å"to experience how the ordinary pebble of ordinary life could be transformed into a jewel through the magic eye of fiction. †(Nafisi 252). They are able to view things with different eyes, in the books they read there is a much more optimistic view than their reality. Seeing things through someone else’s perspective lightens the burden of their reality. They can escape real life momentarily and see things from an unrestricted point of view. Their created world is something that gives them strength to carry on with their daily lives. Denying reality does not help, therefore when they create the fictional world of theirs they realize that the government is trying to take away from who they are. In reality they are the ones who have power over their own minds if not anything else. â€Å" imagine us the way we sometimes didn’t dare to imagine ourselves in our most private and secret moments, in the most extraordinarily ordinary instances of life, listening to music†¦ or reading Lolita in Tehran. † (Nafisi 250). In their real world they always have to be careful of letting themselves show their true selves, but with fiction they are not afraid to be themselves. In fiction, they compare their own situations with the characters in the books they read. Those books teach them things such as totalitarianism to being happy a goal. â€Å"the most central of which was how these great works of imagination could help us in our present trapped situation as women. We were not looking for blueprints†¦we did hope to find a link between the open spaces the novels provided and the closed ones we were confined to† (Nafisi 259). These novels become the girls source of freedom. With these books they are allowed to freely interpret and believe whatever they with in contrast to their reality where they are not allowed to have their own opinions. With their imagination they are not denying themselves, but rather filling in the spaces that they are missing. They cannot experience many things in real life so to fill the void, they do so with fiction. By finding a link between fiction and reality they found a way to keep their individualism. And accepting and creating, fiction allows for them to have a stronger will in order to keep who they are even in the world they are in. â€Å"Perhaps one way of finding out the truth was to do what we did: to try to imaginatively articulate these two worlds and, through that process, give shape to our vision and identity† (Nafisi 264). They are not denying reality, rather it helps them to accept it, they use this world to get through reality, their world reality or imagination motivates them to continue having a strong will and continue moving forward. Not only does it give them the strength to carry on but it keeps their identities in their minds by accepting and personalizing their fantasies motivating them to be individuals. In conclusion, Nafisi and her students have found a way to escape their restrictions and can let themselves be who they want to be through fiction. With the use of literature, Nafisi and her students are trying to reshape and create their own reality. Although their freedoms are temporary, Nafisi’s home is safe from the censor the Revolution put on them that limits their thoughts and actions. They now have power over their minds, something they must rebel against the government to be able to keep for themselves. To be able to keep that power over their minds they are keeping their individualism. Because the girls comply with the government and also participate in the book club, they are not denying reality instead they are learning ways to accept and cope with it. Through fiction Nafisi and her students learned more about themselves and the powers of imagination.

The Contemporary Views On Metaphysics - 1269 Words

Through the centuries views on metaphysics have been laid as foundations, altered for society or simply changed for the better. As this world continues to grow and modernize, so have our views. The contemporary views on metaphysics are extended upon the more traditional views laid in the ancient or medieval times. Martin Heidegger is a contemporary existentialist, who studied the reason of being. He was an important figure of philosophy in the 20th century. His views are very different from the ancient views of metaphysics. Plato was an ancient philosopher, who believed in the immortality of the soul. His most popular readings are the Allegory of The Cave, which depicts the reality in life. With all of this being said, it is up to the†¦show more content†¦They all differ in times, focus and intention. Their focus varies from internal or external beliefs. Their intention relies on the person itself. This can and will be applied in future studies of metaphysics. One of my favo rite ancient philosophers is Plato. I found his Allegory of The Cave to be really interesting. . We have a world that we physically see and one that is completely eternal and can only be percieved within. That is what Plato believed. Individuals are mentally shaped by two distinct realities. One is physical and one is invisible. Plato believed the highest form to believe in, is the invisble. The world that is unchanging and has been here long before we were. The story itself, displays three indivduals who are trapped in a cave and can only see shadows. They formed their own opinions and perspective on life in the cave. Once a prisoner was released, everything changed. All that he thought was true, actually wasnt reality. He informed the other two prisoners and they didn’t believe him. This story is fictional, but displays some cold hard truth. What we percieve through our senses, are no more than an opinion. We must gain real knowledge through philosophical reasoning. 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