The Psychological Effect Of Branding In High Fashion Marketing Essay

The Psychological Effect Of Branding In High Fashion Marketing Essay The American Marketing Association (AMA) defines a brand as a name, term, sign, symbol or design, or a combination of them intended to identify the goods and services of one seller or group of sellers and to differentiate them from those of others sellers.(Kotlers and Keller,2006). So branding is a key aspect of marketing a product. Wheeler explains that brand is created in consumers minds, he states that it gives a promise, the reputation and an expectation about the product and the brand its-self, when these factors are managed properly it results in increased awareness and brand loyality(Wheeler,2003) appart from that, branding helps to convey the market position of the brand to potential customers. Branding in fashion industry is to be concentrated in this paper, as clothing/ fashion industry is one of the most growing industries (reffer to appendix 1). According to Verdict reports, The global market for luxury brands has grown rapidly over the past two decades. Estimated to be worth $263billion in 2007 which represents a 31% increase over the past five years, predictions indicate a 71% growth over the next five years, largely fueled by high demand from emerging economies (Verdict, 2007 in Caroline Tynan et al 2009). Fashion shopping is a personal element of consumer culture, it has become a popular leisure activity (Campbell, 1987). Aron OCass(2002) states that there is no single factor that dominates the morden popular cultural psyche as much as fashion. Apart from this, fashion is a significant way of identity portrayal (Crane, 2000; Wilson, 1990). The expression of personality and individuality with the use of cloths is not a new phenomenon, it was used to represent social class and profession as early as the beginning of civilastion. However, the nature of the modern fashion prospect is such that identities can be created and recreated as fast as posible than ever before (Popp, 2000). Commentators characterise this phenomenon as fast fashion. Similar to the fast food revolution, fast fashion entails rapid change in garment styles some garments having a fashion life of only weeks rather than months or years (Jackson and Shaw, 2001). With the help of celebrity and gossip magazines and media p ower there has been a formation of a culture in which the indecisiveness of fashion has brought to a quite fanatical speed,(Ingrid Jeacle.2009). If a popular celebrity is seen in a particular costume a new fashion trend is born, and then the high street store have to reproduce that look as fast as possible before the competition. (Rosenau and Wilson, 2001). This ability to react to the change as fast as posible is known as quick response (Ingrid Jeacle.2009,Abernathy et al., 1999). This huge clothing, industries total main media advertising expenditure amounted to  £56.7m in the year ending March 2009.(Key Notes, 2009 Clothing Retailing 2009). So a study on how brand is used in this industry and the importance consumers give it, in different aspect would be usful for the industry. The following research aims are set, which is undertaken in this study: To establish a relationship between consumer psychology and brand To analyse brand experience and customer satisfaction To analyse factors affecting brand choice Literature Review What is branding? Branding is the main focal point of this study, it would be appropriate to look into what a brand signifies. There are many definitions given to branding by many scholars as it is one of the basic consistencies of marketing. Branding in simple words could be defined as information that a provider of products or services communicates about the value of its offerings to establish trust and build loyalty among its customers. Brand messages differentiate in the marketplace, acting as a filter for making choices. Brand communicates: If you use my product/service, you will get X level and kind of value. For product and service providers, brand is critical because it helps develop loyalty among the customer base and creates opportunities for cross-selling and for deeper sales within a product/service category. Consumers make decisions about products and distinguish among multiple offerings based partly on brand.Anon(2002). According to Chernatony (2006) there are a variety of interpretations for branding and they are based on three categories, Input-based: stressing branding as a particular way of managers directing resources to influence customers, Output- based : consumers interpretations and considerations of the way brands enable consumers to achieve more, and Time-based : recognising their evolutionary nature. A brand is an identifiable product, service, person or a place, augmented in such a way that the buyer or user perceives relevant, unique, sustainable added values which match their needs most closely(Chernatony and McDonald,2003). Similarly (Miller, 2005) states that brand are name, which has a visual expression, like a symbol, a design, a trademark, a logo. He also argues that a brand is directly used to sell products or services. Like these definitions The American Marketing Association (Kotler and Keller, 2006) defines branding as A brand is name, term, sign, symbol, or design, or a comb ination of them, indented to identify the goods or services of one seller or group of sellers and to differentiate them from those of competitors All these definition by scholars have shown the importance of branding in an organisation or a product. Branding is complex and it is different products offered with different attributes. How ever the successfulness of a brand could be decided ultimately consumers mindsets, it exists largely by virtue of a constant co-ordinated activities across an organisation apprehensive with delivering a group of values are interpreted and internalised by consumers. The decision making tendency of a potential customer will be affected by the culture and sociological nature of the individual. Culture and sociological factors affecting decision making process Roth (1995) states that, Consumers shopping motives are known to be influenced by cultures, social values and socioeconomic conditions of the market. In an increasingly globalised business atmosphere, it is essential that marketing managers study about differences in consumer decision making with regards to culture. The success of an organisation in a culturally different market place may be largely affected by how well the decision makers grasp the consumers buying behaviours, and how well they are able to incorporate such understanding into their marketing plan and strategies.'(C. Leo et al 2005). Consumer decision making style refers to the mental orientation or approach a consumer has towards making choices (C. Leo et al 2005). Though, consumer decision making style represents a comparatively regular prototype of cognitive and affective responses (Bennett Kassarjian, 1972) national culture has been proven to impact considerably on personal values and attitudes (Hofstede, 1980), thus, culture is expected to encompass significant influence on consumer choice. Fashion industry is a very complicated industry, it is handled differ ently in different parts of the globe, especially in the east and the west. There is evidence of cultural differences in consumer decision making styles for fashion industry in the Chinese and other cultures.(Fan Xiao, 1998; Hiu, Siu, Wang Chang, 2001; Lysonski, Durvasula Zotos, 1996).according to Byoungho, J(2003)Shopping motives may be a function of cultural, economic or social environments. As it is this factor, that drives the attitude that brings consumers to stores, consumers valuation of a stores attributes and successive shopping results, for instance shopping satisfaction, must be different according to their shopping motives (Groeppel-Klein et al., 1999; Van Kenhove et al., 1999) thus in countries which has diverse cultures, tastes, and living habits, international service companies require to be conscious of and adaptive to local requirements (Hofstede, 1980; Prahalad and Doz, 1987). Mc Donald would be a good example of this. Veena Chattaraman, Sharron J. Lennon. (2008) research states, that strength of ethnic identification was an important in determining cultural apparel useage and attributes of emotions and meanings to the consumption. De Mooij (2000) says, Although there is evidence of convergence of economic systems, there is no evidence of convergence of peoples value systems. Cultural and social assumptions trigger our opinion, thoughts and judgment (Hoppe, 2004) this is a great factor in our decision making process. Culture points out the forceful practice that takes place within any perticular society grouping and this helps initiate the cognitive map of beliefs, values, meaning and attitudes that drive perception, thoughts, reasoning, actions, responses and interactions (Tung, 1995) Hofstedes seminal typology of cultural dimensions was first announced in 1980 and still leads in the research topic for management and marketing researchers (Furrer, Liu Sudharshan, 2000;M.H Bond,2002). It characterised culture with five dimensions: (1) Power distance (a tolerance for class differentials in society). (2) Individualism (the degree to which welfare of the individual is valued more than the group). (3) Masculinity (achievement orientation, competition, and materialism). (4) Uncertainty avoidance (intolerance of risk; and later). (5) The Confucian dynamic or long-term orientation (stability, thrift, respect for tradition and the future).( Hofstede and Bond, 1988 in Jhon C et al 2000). However many schloars debate that Hofsted model, is used to stereotype.(M.H Bond. 2002). Appart from the cultural factors scoial infuvence is also very important in the marketing of luxury products or high street fashion goods, according to Bagwell and Bernheim, luxury products marketing is related to conspicuous consumption or status superiority signaling (Bagwell and Bernheim, 1996). Erdem et al. (1999) study established that social status was the most imperative brand or store attribute to clothing or fashion shoppers and emphasized so as to brand or store image fashioned through the brand or store attributes significant to shoppers should be coordinated to individuals values to achieve need or motive satisfaction. The studies recommended that the significance of the brand attributes might differ depending on the purpose of shoping. Ian Phaus research states that, status seeking teenagers have an positive apporach to internatinal luxury brand apparel.( Ian Phau, Yip Siew Leng.2008). (Baudrillard 1988, in Ingrid Jeacle. 2009) analyzes spending practices in terms of the conception of signifying practices. Merchandise act as signs, he argues, and thus their buying the goods is not necessarily to apply any financial need, but rather to communicate status to pear group or other consumers. Bourdieu (1984) has also projected a hypothesis to describe the spending of cul tural capital, such as privileged edification. Social status has been seen to survive superior by most consumption practices, they are infused with the symbolism of experience which expedites distinctions farther made between consumers. Psychological effect Psychological effect is one of the most important factors affecting decision making while selecting a brand or a fashion item like clothing or accessories. The consumers develop better association and links with the brands that they are more familiar with (Hoeffler and Keller, 2003). This aspect is very important to marking managers as in the case of luxury goods people may pay more for the particular product than what they pay for similar products in department stores or other ordinary stores. The sales of luxury goods improve as growing passion for quality and stylish goods set a market segment. The number of people with a passion for fashion is continuously growing, in the competitive world people who are willing to pay more for goods which are produced in limited quantities (H.Elizabeth 2010). Owning limited quantities of higher-priced merchandise make many people feel social and confident. Consumers often evaluate imported goods differently than they do identical domestic products (Herche, 1992). In the cases os brands like, Callaway golf or Victorias Secret products, customers are largely acknowaging to the emotional benefit provided by these luxury goods (Traci Warrington ,2004). Research mainly conducted in further developed countries, have shown that consumers have a common fondness for domestic-made merchandise over foreign merchandise, mostly when information about the product is lacking (Damanpour, 1993; Elliott and Camoron, 1994; Wall and Heslop,1989). The importation figure of apparel products, for instance, was found to have an impact on consumer perception of the quality of clothing brands. Cloths from developing country had the image of quality being significatly inferior. (Dickerson,1982; Morganosky and Lazarde, 1987 Cheng-Lu, et al. 2004). However, a reverse pattern of this effect was seen in less developed countries, where consumers may possibly have a liking for imported brands as contrasting to domestic brands (Agbonifoh and Elimimian, 1999; Li et al., 1997; Marcoux et al., 1997; Wang et al., 2000). there are several other factors that affect consumers perception, there hasent been huge amount of research in this area of business in the past ho w ever some researchers have indicated with the intention of consumers perceptions of brand attributes persuade perceptions of shopping costs and shopping satisfaction(Jiaxun He,2010; Ingene, 1984; May, 1989, Sherman et al., 1997). Ingene (1984) study reveled that a pleasant and enjoyable shopping ambience positively affected the shopping time and the amount of money that customers spend in a store, in addition to the sensation of shopping. Another study by May, (1989) explains that status/ prestige or the attractive displays of stores be able to lead consumers to forgo the time and effort necessary to go extra distance to more distant stores. These examples imply that consumers shop at the place where they can maximize their satisfaction effectively. And other researchers argue that ther are other factor that important in consumer perception, like price and energy (Kim and Kang, 1995) In other words, these studies recommend that perception of the cutomers shopping expenses is a dif ferent dimension that must be taken into thoughtfulness to recognize shoppers store selection process. Buying habits Buying habits, like all these factors, helps in marketing and targeting the market segment. Understanding the buying habits of potential consumers will help in branding and marketing, there are many scholars who have given importance to this subject area, (K.P Kaas, 1982; Caroline B. et al, 2009; P. Knowles, 2002). These researches help in improving the brand image and loyalty. Designer brands use these buying habits to personalise the services given to their regular customers, (in most cases they might be celebrities). In other words buying habits helps us to stereotype consumers and results in targeting only the potential customers, for example, Bruce in his paper states that, young and affluent shoppers who are the fashion stores core customers and fast-fashion chains such as Zara and HM target these customers. (E.Bruce, and Wing-Gar Cheng,2010) They also state, that most department stores in China and other countries devote most of their space to high-margin goods such as cosmeti cs, clothes, and shoes. Those items now account for 70% of sales at the top department stores (E.Bruce, and Wing-Gar Cheng, 2010) According to Sanguanpiyapan, Thitiporn, and Cynthia Jasper. (2010) customers shop for luxury goods where they shop is due to the functinal and nonfunctional shopping motives. According to their research the nonfunctinal motive is very important to analise why they shop where they do. Their research shows that the overall experince which they get from a store is very important in influvencing the customer decition as to where they go for the luxury goods. (Sanguanpiyapan, Thitiporn, and Cynthia Jasper, 2010). Costomers decisions concerning where to purchase or shop are based on their approach toward a stores products mix in addition to the shoppers personal inner orientations, such as motives, needs or values (Gentry and Burns, 1978, Finn and Louviere, 1996;). H. Brad(2010) also argues that the envoirnment is very important for sucsessful retailing, he says that the sles staff should be fully trainsd and knowlageble about the proucts that they sell and the attitude of thes staff is very important in customer satifaction and repeat business. According to Sproles and Kendall (1986,), a consumers decision-making patterns are a mental orientation characterizing a consumers approach to making choices. Their research identified eight mental characteristics describing a consumers decision-making style. The eight decision styles are: (1) Quality conscious; (2) Brand conscious; (3) Fashion conscious; (4) Recreational and hedonistic orientation; (5) Price conscious; (6) Impulsive and careless tendencies; (7) Confused by overchoice; and (8) Brand loyalty These eight factors illustrate the most common and basic psychological or mental characteristics of a potential customers decision making and these are directly related to the consumer choice and behaviour. This information is also necessary in identifying the target market, (i.e. the segments of consumers sharing similar attitudes to shopping ) (Lysonski et al., 1996). Since clothing is one of the most growing industry (it provide huge options) and these behaviours can be identified because of the huge choice available in this industry. The usual factors that one thinks of when selecting a dress or an accessory would be to evaluate the style, colour, brand, design, price and some people check the country of origin. These choice stlyes or behaviors are mostly appropriate to certain shopping attitudes of interest, such as brand conscious, fashion conscious,price conscious, and hedonistic orientation.from this, it is fascinating to see the connection among consumer decision-making styl es and the choice made.(Cheng-Lu, et al. 2004) Tauber (1972) hypothesizes six personal motives for shopping (i.e. role playing, diversion, learning about new trends, self-gratification, physical activity, and sensory stimulation) and five social motives (i.e. social experiences outside the home, communication with others who have a similar interest, peer group attraction, status and authority, and pleasure of bargaining) this was found with in-depth interviews. Taubers study will be very useful in studying the buying habits of consumers. Fashion leaders Fashion leaders are very influential in the decision making process. Most people are always looking forward to celebrities or famous people. Celebrities life style can be imitated by many people, especially by fashion conscious people. This phenomenon has been studied by very few researchers. In the 21st century the fashion world revolves around this phenomenon. If a popular celebrity is seen in a particular costume a new fashion trend is born, and then the high street store have to reproduce that look as fast as possible before the competition. (Rosenau and Wilson, 2001). Most high street fashion stores survive on reproducing the styles that celebrities set. This ability to react to the change as fast as posible is known as quick response (Ingrid Jeacle.2009,Abernathy et al., 1999). Apart from celeberies, fashion leaders can be a popular members of their peer group. Michon R, et al (2007) says that, the mall surrounding can be directly influences fashion leaders hedonic shopping experience and approach behaviour. Fashion followers hedonic shopping experience may be mood driven, while that of fashion leaders is triggered by higher involvement cognitive processing (Michon R, et al 2007). (Vernette E ,2004) Reveals that in womens fashion, especially magazines, a media plan targeted at opinion leaders can succeed, that these opinion leaders ten d to be positive towards and discuss advertising media and that they read more womens fashion magazines and have more affinities with such media than non-opinion leaders. Celebreties are used in advertisement of fashion goods because; in general they tend to be perceived as more attractive, competent, or honest when they are associated with specific branded products characterized by a prevalence of elements that remind perceivers of the corresponding credibility sub-dimension (Guido and Pelusos, 2006). (Kamins 1990) study found that, a highly attractive celebrity endorser is effective for attractiveness-related products. When advertising fashion goods selecting a brand ambassador is very important because they are looked as the face of the brand, they way the look is very important for these goods, apart from this their social life is also very important (Guido et al 2009). Because their social life can affect the image of the brand a good example for this would be Tiger woods, in 2010 when his personal life was under lime light, his personal image was portrayed in a negative format and thus many brands associated with him felt that these media images might affect the image of the brand. These influential people in the society are watched very keenly and some time people try to imitate them mainly the way they dress. Brand loyalty Doyle (1989) stated, that the most significant condition of brand success was connected with differential advantage and the stupendous reputation or image for quality, service, or reliability. This he believed will in turn create brand loyalty. Ehrenberg and Scriven, (1996) states that brand loyalty varies little from brand to brand. Some papers state that, cissessed in long term on the basis of a competitive advantage that competitors find difficult or complicated to copy or achieve and that consumers distinguish as highly desirable for example superior customer service or the brand image/attiude that create brand loyalty. (Cokayne 1991 and De Chematony and McDonald 1994) Loyal customers are the strength of the value of a brand as it is these customers who are least likely to defect and hence it will be these customers who will be going to buy the same brand for years to come (Hofmeyr and Rice, 2000). Isabel Buil,et al (2009)says that, Brand extensions with high fit receive more favorable consumer evaluations and decrease the negative feedback effects of extensions on parent brand equity. A brand can stimulate greater levels of the repeat purchase phenomenon among customers, especially the loyal ones (Miller, 2005). Customer loyalty has become something of a legend in marketing concepts and theories, which is based on the above assumption. Brand loyalty has largely been defined in terms of attitudinal terms or behavioural terms (Mellen et al,1996). The researchers generally consent to the point that Brand loyalty is a complex construct (Javalgi and Moberg, 1997) and claim wide acceptance to the definition brought forward in the first instance by Jacoby (1971). Thus the widely accepted definition for Brand Loyalty is that, it is biased (non-random) behavioural response (purchase) expressed over time by some decision-making unit with respect to one or more alternative brands out of a set of brands and is a function of psychological processes. At the same time the definition enjoys wide acceptance it is also noted that the few people would be classified as truly loyal when all the above stated criteria have to be complied with. As Wood (2004) observes that it is possible for consumers to buy a brand they dislike because it is the one that is readily available to them .Also states that it should not be assumed that behavioural loyalty involves feelings or positive cognitive process as antecedents. Thus Brand loyalty however is not the sole driver for the customers to stick to a particular brand. One of the investigations into the issue introduced a new paradigm of brand commitment. Hofmeyr and Rice (2000) argue that the key to brand profits is creating a committed customer base. They suggests that the customer purchasing decision is influenced by how committed they are to the brand, as even though the consumer may buy a particular brand repeatedly, this may be because the brand of their choice is not available to too expens ive. Hence points out that the brand attitude would be one of the deciding factors in loyal behaviour, there are other influential factors like distribution, market concentration and activities promoting the brand. It is very important for the brand owners to keep track and understand the variables that are the basis of loyalty , specially that of the loyalty behaviour for the brands due to various reasons. Today, traditional consumer life-stages are fragmenting , the social and economic changes raging from fractured career paths, redundancy , increasing in single, separated, widowers and divorcee group etc all of it disrupts the traditional pattern(Kottler and Keller,2006). ). Studies have shown that consumer buying behaviour is habitual, habit have also been hard to break, and looked on as safe and familiar (Bandyopadhyay,Gupta and Dube,2005). Therefore, if the competitor brand is to inspire loyalty and break an old habit, it would be a real success in marketing and brand management. A recent research on the importance of the nature of brand loyalty, argued that the relation between brand loyalty and size of the brand is inversely proportional(Bandyopadhyay,Gupta and Dube,2005). Smaller bran ds attract fewer customers than large brands, and customers opt for larger brands far more frequently, this double disadvantage of the less popular brands is termed by many experts as double jeopardy (Bandyopadhyay,Gupta and Dube,2005). A study shows that business lose between 15 % to 20% of customers a year, and retention of 80 % means that customers on average , remain loyal only for 5 years and improving retention to 90% leads to the average life of a customer doubling to ten years (Boone and Kurtz,2006). There have been several other studies which seem to corroborate the fact that brand loyalty is a highly desirable phenomenon to any marketing initiative. Customer loyalty and building long -term relationships is vital; as more saturated the market, the more difficult and expensive it is to win new customers and more the existing customers are.It goes to the extend that the increasing focus of marketers on retention of exsisting customers and less on attracting new ones(Verhoef,2003). One of the widely quoted studies in most of the literature was a research conducted by Bain and Co, which came up with a simple equation suggesting that the cost of winning a new customer would be five times as high as the cost of retaining an old one (Reichheld, 1996). This is a significant incentive for companies to invest in measures which help boost brand loyalty. The same paper also gave out a statistic suggesting that a minor control on the rate at which the customers defect form the companies bran d can have a significant impact on the overall profitability i.e. a cut of 10-15% can boost the profitability by over 60% (Reichheld, 1996). There is however little doubt about the role of brand loyalty in building the strength of a brand and adding value to the business. Specified below are some of reasons which emphasize the implications of building the emotional relationship with the customer in terms of brand loyalty (Miller, 2005)- Cost: The costs of attaining new customers are condensed to a great degree Distributors e.g. retailers are happier to stock brands with high loyalty Highly loyal customers tend to become brand advocates to family, friends and colleagues and thus act as ambassadors of the brand and bring in new customers A loyal customer foundation acts as a breathing space for companies a kind when faced with market changes Brand loyalty has thus a important role in defining brand equity and brand valuation. Brand image and brand attitude significant research efforts has been concentrated on identifying important brand or store attributes that constitute brand or store image which influence consumers store choice and benefaction (Dickerson and Albaum, 1977; Hansen and Deutscher, 1977-1978; Lindquist, 1975). Erdem et al. (1999) studed the nine dimensions of Lindquist (1975) and developed an evolved three key store attributes for clothing shopping: (1) Status; (2) Merchandise; and (3) Price. Apart from this approach, Westbrook and Black (1985) also hypothesized three categories of shopping motives: (1) Product-oriented; (2) Experiential; and (3) A combination of product and experiential. Accordind to Parks and his teams study, brand images or advertisements based on an perceptive of consumer motives/needs have been viewed as an efficient way to converse product benefits (Park et al., 1986; Jiaxun He, 2010). Doyle (1989) revealed that the most essential principle of brand success combined with the degree of difference advantage was exceptional reputation or image for quality, reliability or service. This, he was convinced that this, enabled successful brands to accomplish numerous additional criteria, for instance seize higher prices than less successful brands. However some researcher argue that the success of a brand depends on factores like market share, shareholders equity and profitability (Innscher1993, , Gale 1987, Hansen, Gronhaug and Wameryd, 1990 and wilson 1978). (Dall Olmo Riley et al., 1997) have recognized strong correlations involving a brands market share and consumer attitudes towards it. But according to Pitta and Katsanis (1995), successful brands w ere the brands with a strong image or personality, when consumers perceived specific attributes as being strongly associated with particular brands. Keller (1993) describes, that the brand associations needed to be congment because the favourability and strength a brand association could be influenced by other brand associations. De Ghematony and McDonald (1994) in their study highlights the importance of added values as a main feature of successful brands. De Ghematony and McDonald (1994) also mentioned that, it was perceived effect, other than the actual quality that accounted and that this effect was assessed by consumers in camparison to other brands. These consumer-based achievement criteria are influential to business-based measures of achievement, such as the consistent stream of future income and the superior eamings that originate from high market shares, premium pricing and from the ability to resist pressure from the trade for discounts. (De Chernatony et al,1998). Joachimsthaler and Aaker (1997) explains that visibility have to be joined with clear brand identity, so that those conniving and implementing the communications channels do not accidentally send confusing or conflicting messages to consumers. Stephens et al. (1996) states, that a long-term good relationship with the consumer is very important in creating of successful brands image. With the creation of a high brand image and brand attitude, brand will be able to originate to premium pricing, high market shares, and from the ability to oppose pressure from the business for discounts. (Gokayne 1991)

The Last Tea Dorothy Parker

The Last Tea By Dorothy Parker The story submitted to the consideration is called â€Å"The Last Tea† and is written by Dorothy Parker. As for the writer, I have to mention that Dorothy Parker  was an  American  poet, short story writer, critic and  satirist, best known for her wit, wisecracks, and eye for 20th century urban foibles. Concerning the title of the story it is thought-provoking and made me read the story. At first glance it seems fairly simple, but with the development of the story is surprisingly complex. The last tea is a story that is addressed to women and deals with 2 main topics: men`s attention and loneliness.This is a bitter story written in a cruel way. Now I’d like to reconstruct the events. The young man and the girl met somewhere at the cafe for a cup of tea. He told her about another woman whom he was delighted by. While he was telling about that woman, the girl heard him out with patience and even with some positive commentaries. At th e end of their conversation he suggested to pay the check and put her on a bus. Instead she refused and said with the irony that he wanted to call up his friend. And he without any suspicion said goodbye to her and gave her the best wishes.Speaking about the theme of the story I’d like to pin down the relationships between a man and a woman. As for the idea, it is the nonmutual love as the result of not having much in common, misunderstanding within sexes. The story presents an interesting example of the indirect characterization. The author does not say directly that the girl is lonely but let her act and leaves the reader draw his own conclusion. The story begins with the description of the young man and the girl who are the main characters of the story.There in not any preface of the story: we know nothing about the past of the people. The author shows the characters in a certain period of their lives. The plot is trivial and the characters are really true to life. The tex t is homogeneous. It`s almost consists of the characters` dialogues, where you can find numerous words and phrases of informal style. E. g:  « That`s good »,  «the poor boy »,  «poor sick thing »Ã¢â‚¬ ¦ Also interjection  «Oh, Ah, goodness » introducing some of the passages which normally occurs in oral speech. The sentences have free and careless structures.From the very beginning we come across a witty satire. Such stylistic device is used by the author to draw our attention and to make us commiserate to the girl. E. g.  «The girl with the artificial camellia had been sitting for 40 minutes » but she said  «I was late myself »  «I haven`t been here more than a minute ». She tries to be polite and to show the great care to the man. E. g.  «I`m ruined » he said.  «Ah the poor boy »  «Ah and you came way up here to meet me! You shouldn`t have done that »    â€Å"I would have understood. Ah just think of it coming all the way up here when it `s so sick! – She said. But the man begins talking about another woman Carol McCall. The man considered her to be perfect. He said  «that`s what I call a girl ». This part can be regarded as a climax of the story. To conclude it all up, I’m to say that the problems presented in this text are very topical in our every-day life. People often don’t notice those who are near them, who care about them, who are devoted to them. The best we can do is to pay tribute to the author’s vision of life and to her ability of creating the atmosphere of being entirely involved in the process of the story.

China and Usa: a Comparison of Their Monetary Policies

University of International Business and Economics China and USA: A comparison of their Monetary Policies. Mid-term Project School of International Trade and Economics BY Rebecca Bogiri Professor: LIN GUIJIN Beijing, China 2 December 2009 China and USA: A comparison of their Monetary Policies. By: Rebecca Bogiri December 2009 Abstract The monetary policies of USA and China is analyzed here from the perspective of their implementing bodies, their choice of instruments, and their means of setting their interest rates. The analysis reveals that there are immense differences between the two countries resulting from the nature and degree of influence from their respective domestic political systems. The paper concludes that China has a complex political economy that represents a hybrid of private ownership and state control. Therefore unlike the USA, its monetary policies are subject to political influence. Keywords: Monetary policy; Monetary policy instruments; Balance Sheet; China; USA Author’s email: becky. [email  protected] com ContentsPage Abstract †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 1 Introduction †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 3 USA Monetary Policy †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦. 3 China Monetary Policy †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 7 Comparison of China and USA’s monetary policies †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦ 9 Conclusion †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã ¢â‚¬ ¦Ã¢â‚¬ ¦. 10 References †¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦Ã¢â‚¬ ¦.. 11 1. Introduction Monetary Policy is the process by which the government, central bank, or monetary authority of a country controls (1) the supply of money, (2) the availability of money, and (3) the interest rate, in order to attain a set of objectives oriented towards the growth and stability of the economy. This paper refers the above theme to two countries: China and USA. As such, there are three broad objectives. The first is to discuss monetary policy generally as carried out in the USA. The second is to discuss monetary policy generally as it is carried out in China. The third is to compare and analyze the way monetary policy is implemented in the two countries. 2. USA Monetary Policy How is the Federal Reserve structured? The Federal Reserve System (called the Fed, for short) is the nation's central bank. It was established by the Federal Reserve Act[1] and consists of the Board of Governors in Washington, D. C. , and twelve Federal Reserve District Banks. The Congress structured the Fed to be independent within the government. Therefore although the Fed is accountable to the Congress and its goals are set by law, its conduct of monetary policy is insulated from day-to-day political pressures. This reflects the conviction that the people who control the country's money supply should be independent of the people who frame the government's spending decisions. What makes the Fed independent? Three structural features give the Fed independence in its conduct of monetary policy: the appointment procedure for Governors, the appointment procedure for Reserve Bank Presidents, and funding. Appointment procedure for Governors:  The seven Governors on the Federal Reserve Board are appointed by the President of the United States and confirmed by the Senate. Independence derives from a couple of factors: first, the appointments are staggered to reduce the chance that a single U. S. President could â€Å"load† the Board with appointees; second, their terms of office are 14 years–much longer than elected officials' terms. Appointment procedure for Reserve Bank Presidents: Each Reserve Bank President is appointed to a five-year term by that Bank's Board of Directors, subject to final approval by the Board of Governors. This procedure adds to independence because the Directors of each Reserve Bank are not chosen by politicians but are selected to provide a cross-section of interests within the region, including those of depository institutions, nonfinancial businesses, labor, and the public. Funding:  The Fed is structured to be self-sufficient in the sense that it meets its operating expenses primarily from the interest earnings on its portfolio of securities. Therefore, it is independent of Congressional decisions about appropriations. How is the Fed â€Å"independent within the government†? Even though the Fed is independent of Congressional appropriations and administrative control, it is ultimately accountable to Congress and comes under government audit and review. Fed officials report regularly to the Congress on monetary policy, regulatory policy, and a variety of other issues, and they meet with senior Administration officials to discuss the Federal Reserve's and the federal government's economic programs. The Fed also reports to Congress on its finances. Who makes monetary policy? The Fed's FOMC (Federal Open Market Committee) has primary responsibility for conducting monetary policy. The FOMC meets in Washington eight times a year and has twelve members: the seven members of the Board of Governors, the President of the Federal Reserve Bank of New York, and four of the other Reserve Bank Presidents, who serve in rotation. The remaining Reserve Bank Presidents contribute to the Committee's discussions and deliberations. In addition, the Directors of each Reserve Bank contribute to monetary policy by making recommendations about the appropriate discount rate, which are subject to final approval by the Governors. Objective of Monetary policy Monetary policy has two basic goals: to promote â€Å"maximum† sustainable output and employment and to promote â€Å"stable† prices. These goals are prescribed in a 1977 amendment to the Federal Reserve Act. In the long run, the amount of goods and services the economy produces (output) and the number of jobs it generates (employment) both depend on factors other than monetary policy. These factors include technology and people's preferences for saving, risk, and work effort. So, maximum sustainable output and employment mean the levels consistent with these factors in the long run. But the economy goes through business cycles in which output and employment are above or below their long-run levels. Even though monetary policy can't affect either output or employment in the long run, it can affect them in the short run. For example, when demand weakens and there's a recession, the Fed can stimulate the economy temporarily and help push it back toward its long-run level of output by lowering interest rates. That's why stabilizing the economy, or smoothing out the peaks and valleys in output and employment around their long-run growth paths—is a key short-run objective for the Fed and many other central banks. USA Federal Reserve – Balance Sheet |ASSETS |LIABILITIES |Gold and Foreign Exchange |Currency | | |Held by public | | |Vault cash | |Federal Reserve Credit |Bank Deposits | |Loans & Discounts | | |Government Securities | | |Other credits | | Source: Federal Reserve Bulletin, May 1996. Monetary policy instruments The Federal Reserve has three instruments for controlling the money supply. They are: 1. Open Market Operations 2. The discount rate; and 3. The required reserve ratio. When using Open market operations, the Fed buys or sells government securities to affect the leve l of the money supply. For example, if the Fed wishes to increase the money supply by $2 million, it will purchase government securities worth $ 2 million. The Fed’s assets increase by $ 2 million under the securities heading. In order to pay for the government security, the Fed writes a check on itself. In return for the bond, the seller receives a check instructing the Fed to pay the seller $ 2 million. The seller then takes the check to his bank, which credits the depositor with $ 2 million, and then deposits the check at the Fed. The bank has an account with the Fed, which is now credited with $ 2 million. Thus the Fed’s liabilities increase by $ 2 million under the heading of bank deposits, as the commercial bank has just increased its reserves by $ 2 million which are held by the first instance as a deposit at the Fed. Another monetary policy instrument used to affect the level of the money supply is the Discount rate, which is the interest rate charged by the Fed to banks that borrow from it to temporary needs for reserves. Increasing the discount rate discourages banks from borrowing from the Fed, while lowering the rate encourages banks to borrow from the Fed and thus increase the money supply. The required reserve ratio refers to the percentage of total deposits that the Fed requires individual financial intermediaries to keep at the Fed as reserves. The significance of the required reserve ratio is that it affects the money multiplier, and thus the level of the money supply. For example, if the Fed wants to increase the money supply, it can do so by reducing the required reserve ratio. Because there are now less reserves and more money is available for the banks to be able to meet their customer’s demand for cash. This increases the money multiplier, which also has a positive effect on the level of the money supply. Required reserves do not pay any interest, so increases in the required reserve ration has undesirable side effects on bank profits. Open market operations are nearly always the favored tool of choice by the Fed. The Fed Open Market Operations in 2008 summarizes all monetary policies and tools used by the Fed for that year. The two tables below shows the changes in the federal funds target rate, and the primary credit rate, and the interest paid on the required reserves and excess reserve balance.. These were operational measures taken by the Fed to influence the Federal funds rate. It is evident that the Fed rapidly and continually decreased the federal funds rate and the primary credit rate throughout 2008. Furthermore, on October 8th 2008 the Fed started to pay interest on despository institutions’ required and excess reserves balances as authorized to under the Financial Services Regulatory Relief Act[2]. [pic] [pic] 3. China Monetary Policy Body in charge of Monetary Policy: Monetary policy in China is conducted by the People’s Bank of China. Article 12 of the Law of the People? s Republic of  China  on the People? s Bank of China provides † the People? s Bank of China is to establish a monetary policy committee, whose responsibilities, composition and working procedures shall be prescribed by the State Council and shall be filed to the Standing Committee of the National People? s Congress. The Monetary Policy Committee shall play an important role in macroeconomic management and in the making and adjustment of monetary policy. â€Å" Rules on Monetary Policy Committee of the People? s Bank of China stipulates that the Monetary Policy Committee is a consultative body for the making of monetary policy by the PBC, whose responsibility is to advise on the formulation and adjustment of monetary policy and policy targets for a certain period, application of monetary policy instrument, major monetary policy measures and the coordination between monetary policy and other macroeconomic policies. The Committee plays its advisory role on the basis of comprehensive research on macroeconomic situations and the macro targets set by the government. The Monetary Policy Committee is composed of the PBC? Governor and two Deputy Governors, a Deputy Secretary-General of the State Council, a Vice Minister of the State Development and Reform Commission, a Vice Finance Minister, the Administrator of the State Administration of Foreign Exchange, the Chairman of China Banking Regulatory Commission, the Chairman of China Securities Regula tory Commission, the Chairman of China Insurance Regulatory Commission, the Commissioner of National Bureau of Statistics, the President of the China Association of Banks and an expert from the academia. The Monetary Policy Committee performs its functions through its regular quarterly meeting. An ad hoc meeting may be held if it is proposed by the Chairman or endorsed by more than one-third of the members of the Monetary Policy Committee. Objective of Monetary policy: The main objective of the Chinese monetary policy is to maintain the stability of the value of the currency (the Renminbi), and thereby to promote economic growth. People’s Bank of China – Balance Sheet ASSETS |LIABILITIES | |Credits to FI |Deposits of FI | | |Central Bank Reserves | | |Excess Reserves | |Foreign Exchange Reserves |Central Bank Bills | |Securities |Deposits of Treasury | | |Currency in Circulation | Source: AE502 Macroeconomic Analysis Monetary Policy Instruments The People’s Bank of China in conducting Monetary policy has several instruments at its disposal which include: 1. The reserve requirement ratio 2. The Central Bank base interest rate 3. Rediscounting 4. Central Bank Lending 5. Open Market Operations 6. Other policy instruments as specified by the State Council In essence, the monetary instruments listed above correspond to the descriptions given under the Fed’s monetary policy heading. However, the main tool of choice for the PBC is the reserve requirement ratio. For example, in the PBC 2008 Annual Report on Monetary Policy it was reported that in order to sterilize excess liquidity in the first half of 2008, the reserve requirement ratio was decreased cumulatively by 3 percentage points on 5 occasions. Furthermore, a lower required reserve ratio was applied to rural credit cooperatives (RCCs) and financial institutions in the quake-hit areas. Furthermore, in the second half of 2008 with the heightened international turmoil and in order to ensure ample liquidity in the banking system, the PBC further reduced the required reserve ration of financial institutions on another four occasions resulting in a cumulative decrease of 2 percentage points for large financial institutions, and a cumulative decrease of 4 percentage points for smaller financial institutions. According to PBC calculations, by the end of 2008 a total of 800 billion yuan of liquidity was released into the economy. The choice of the reserve requirement ratio as the mail policy instrument is not coincidental to China which runs a high current account surplus. There is a large and growing demand for the RMB, and to maintain the RMB at the desired level the PBC issues RMB to meet this demand thereby increasing the money circulating in China. To keep inflation and economic growth under control, the PBC sterilizes its foreign exchange market interventions by buying back some of the RMB it issued to buy US dollar. In particular, it does so by selling low yield government securities to state-owned banks. So far, the banks have been able to absorb those low yield bonds in part because the interest rates paid on them bank deposits are also maintained at artificially low rates. Nonetheless, the increases in foreign reserves are not fully neutralized. Over the last five years broad money supply in China has been growing at above 15% per annum while real economic growth has averaged about 10. 5%. [3] Furthermore unlike more developed market economies, China is reluctant to raise domestic interest rates to slow its domestic growth. Doing so might mean attracting more capital inflows, which would in turn, require further money issuance to stabilize the exchange rate. That is precisely why the PBC instead changes the reserve requirement ratio on an ongoing basis to control the expansion of money and credit. 4. Comparison of China and USA’s monetary policies There are three main differences between China and the United States where monetary policy is concerned: independence of the monetary policy implementing body, choice of instruments to use in implementing monetary policy, and direct or indirect means of setting interest rates to effect monetary policy. Furthermore, these three differences are inter-related and country specific. The first major difference between the Federal Reserve System (the Fed) and the People’s Bank of China (PBC) concerns their independence from national politics. The intention of Congress when designing the Federal Reserve Act was to keep politics out of monetary politics. The Fed is totally independent of other branches and agencies of the government. Furthermore, it is self financed and therefore is not subject to the congressional budgetary process. On the other hand, the PBC is not independent from national politics in China. The PBC reports directly to the State Council which serves as China’s cabinet as well as its highest executive body. Moreover, monetary policy in China is aimed at limiting the appreciation of the renminbi (RMB), while eeping economic growth at a sustainable pace and inflation under control plus preserving a fragile banking system. The Fed in contrast implements a monetary policy that has a dual objective of maximum employment and price stabilit y. The second difference regards the choice of the monetary policy instruments used by the Fed as opposed to the PBC. The choice of instruments used in implementing monetary is essentially the same, except that the PBC has the an additional instrument; namely â€Å"additional instruments as specified by the State Council. † It is therefore no surprise that this ‘extra instrument’ arises from the lack of independence on the part of the PBC. The third difference between the Fed and the PBC lies in the way they set the interest rates. The Fed sets its federal funds rate indirectly by setting a specified target rate and then using the the tools of monetary policy (open market operations, discount window lending, and reserve requirements) to achieve that target rate. As a result, the changes in the federal fund rates trigger a chain of events that affect other short term interest rates, long term interest rates, the amount of money and credit in the economy, plus other macro-economic variables such as employment, growth and the prices of goods and services. In contrast, the PBC has a direct influence on its interest rate because of the extra instrument described above. Because there is provision for other policy instruments as specified by State Council, this allows the PBC to set interest rates directly, and thus have a direct impact on the its balance sheet. 5. Conclusion There are major differences in monetary policy and central banking in China and the USA. China has a complex political economy that represents a hybrid of private ownership and state control. Therefore, the PBC’s monetary policies, choice of instruments and methods of implementation are quite different from that of the Fed. Monetary policy in China aims at curbing the appreciation of the RMB while keeping economic growth at a sustainable pace, inflation under control, and preserving a fragile banking system. This is contrasted with the Fed’s monetary policy with the dual objective of maximum employment and price stability. Different monetary policy objectives, coupled with the degree of political independence on the part of the Fed and the PBC greatly influence the choice of instruments used and the method of implementing monetary policy in the two respective countries. 6. References Federal Reserve Bank of New York Domestic Open Market Operations During 2008 Federal Reserve Bank of New York: â€Å"Annual Report Domestic Open Market Operations during 2008† Federal Reserve Statistical Release 19 November 2009 Ian Sheldon, â€Å"US-China Trade Policy: Who gains from a rise in the Yuan? † at http://aede. osu. edu/programs/Anderson/trade Luc de Wulf and David Goldsbrough, â€Å"The Evolving Role of Monetary Policy in China†, IMF Staff Papers WP/04/125 Michael Moskow and Cathy Lemieux â€Å"China up close: Understanding the Chinese economy and financial system†, at www. chigacofed. org People’s Bank of China Monetary Policy Annual Report 2008 Peter Stella, â€Å"The Federal Reserve System Balance Sheet: What Happened and Why it matters† IMF Staff Papers WP/09/120 Financial Services Regulatory Relief Act 2006 (USA) Federal Reserve Act 1913 (USA) Law of the People’s Republic of China on the People’s Bank of China 1995 (China) http://www. frbsf. org/publications/federalreserve/monetary/structure. html http://www. pbc. gov. cn/english/huobizhengce/MPC. asp http://en. wikipedia. org/wiki/Monetary_policy ———————– [1] 1913 [2] 2006 [3] China close up (2008)

Recycling Should Be Mandatory for Everyone - Free Essay Example

Sample details Pages: 2 Words: 693 Downloads: 1 Date added: 2019/03/14 Category Environment Essay Level High school Tags: Recycling Essay Did you like this example? With the growing focus on environmental issues, experts have advocated for recycling. The move has been informed by the positive outcomes of using recycling as means of addressing environmental degradation. However, despite the growing supports for recycling, some people have opposed it citing several shortcomings. Their argument is based on an increase in the wastage of resources. Based on the opposing point view, it high time to evaluate the positive and negative effects of recycling. The outcome of the analysis will form the basis for making recycling a mandatory practice for everyone. Recycling aid in the conservation of the worlds natural resources. The emphasis on the need to recycle material has reduced the volume of natural resources extracted from the environment (Bartl). For example, by recycling paper, the industry demand for timber has declined. As a result, the level of deforestation will be maintained at a sustainable level. If the world makes it a mandatory practice, then more forest cover will be protected since paper can be recycled seven times. Therefore, it will take time before the demand is created. Don’t waste time! Our writers will create an original "Recycling Should Be Mandatory for Everyone" essay for you Create order Implementing a mandatory policy of recycling aids in reducing the volume of pollution to the environment. Factories such as paper mills cause a lot of pollution to the environment. if demand for their products increases, then the level of pollution also goes up. Currently, the paper mills have been ranks as the third leading industry in environmental pollution (Vijay, 31). The mills cause water, air, and land pollution. Therefore, by sensitizing the society on the need to recycle paper, it reduces the volume of mill factor production. As a result, the potential impact of pollution such climatic change will a thing of history. Recycling reduces the volume of waste materials on landfill thus limiting the prevalence of health problem. Cases, where people embrace the practice of recycling, have recorded a decrease in the volume of waste on landfill (Omid et al). The effect was felt without making cycling as mandatory prices. Therefore, if it were to be made a mandatory practice, better results will be achieved. The policy aids in shaping the behavior of people towards the treatment of reusable materials. Most people will be motivated to embrace the practice of recycling for fear of action. As a result, the health issues associated will filled landfills will decline. However, recycling has contributed to the wastage of resources. Most people were motivated to use more of the available product when recycling measures were implemented. Studies conducted on the restroom papers indicated the volume of usage increased tremendously when recycle bin were used (Wang Catlin, 126). The finding affirms that recycling will increase paper consumption. Based on the above arguments, the benefits of recycling outweigh its costs. Recycling has proven to be an efficient and cost-effective way of addressing environmental issues. However, research indicates that educating people on the benefits of recycling may not aid in conserving the resources (Wang Catlin, 127). Therefore, the world should make it a mandatory practice that every individual should practice. The policy makes should come out and makes it a law requiring businesses and consumers to recycle materials such as paper and aluminum containers. Recycling has both benefits and shortcomings. It aids in the conservation of natural resources such as a forest. Through recycling, the volume level of deforestation will decline as demand for more paper decreases. Also, it leads to a decline in environmental pollution as industry activities will be limited. Through recycling, only a small volume of waste materials finds their way into the landfill thus protecting from the health problems. However, the implementing recycling option has contributed to wastage of resources. Research indicates that implementing recycling option leads to an increase in material uses. Work Cited Bartl, Andreas. Moving from Recycling to Waste Prevention: A Review of Barriers. Sage Publication (2015) Omid, Nodoushani, Carol, Stewart, Manpreet, Kaur. Recycling and Its Effect on The Environment. Questia (2017). Vijay, Kumar. Recycling of Waste and Used Paper: A Useful Contribution in Conservation of Environment: A Case Study. IOS Press (2017): 31-37 Wang, Yitong Catlin, Jesse. Recycling Gone Bad: When The Option to Recycle Increases Resource Consumption. Journal of Consumer Psychology. (2013): 122-127