Macroeconomia

College of Computer Training (CCT)

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DECLARATION

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Introduction

This assignment is about macroeconomics theory, the issues facing Irish economy and investigation the principal issues of open economy macroeconomics and analyse the process of globalization. I choose five main economic policy issues facing Ireland today which are: Unemployment, Irish corporation tax, Irish property fiscal policy and industry. I will make analyse how the government plans to address these issues in the future.

Macroeconomics

Macroeconomics is the holistic operation of economics, we study all the internationals problems and this problems affect the internal economy, it is a study of figures, consequences and the policy issues. A good understanding of macroeconomics helps to prevent issues and helps to the country to grow making the other countries thrust more and invest.

Macroeconomics Models

The  circular flow model of the economic activity, it introduces all of the principal agents in the economy: households, firms, financial institutions, the state and foreign markets, the model also explain how these sectors interact. We use this model to introduce the three ways by which economic activity is measured. Gross domestic product(GDP), the most common measure of economic activity, is often used as a measure of national economic activity and as basis of international comparisons. It defects as a measure of prosperity.

Gross domestic product (GDP) is the value of all goods and services produced domestically in the economy, regardless of the nationality of the owners of the factors of production. GDP for Ireland includes the value of output produced by subsidiaries of foreign multinationals operating in Ireland. The output of Irish multinationals operating outside the country is excluded.

There are three methods for measuring economic activity, it indicates that the factors of production are combined to produce output. In turn, the factors of production are paid income which then become expenditure.

Unemployment

Unemployment represents the number of people in the work force who want to work but do not have a job. It is generally stated as a percentage and calculated by dividing the number of people who are unemployed by the total work force.

The work force is made up of those people who want to work; it excludes people who are retired, disabled, and able to work but not currently looking for a position; for instance, they may be taking care of children or going to college.

The government defines those who want to work as people who have actively looked for work within the past four weeks to of and determines the number of people currently unemployed through a monthly survey called the Current Population Survey.

People can be unemployed for many reasons:

• They quit their position and are looking for a new one.
• They were laid off due to lack of work and haven't yet been rehired.
• Their company reduced the work force, and they are seeking a new position. This can be due to a local condition, when the company closes a plant or division, or a national condition, when the economy slows and many companies reduce their work force.
• They have recently returned to the work force - perhaps from pregnancy or attending school - and haven't yet located a position.
• The need for their skill set has gone down, and there are limited positions available, which may lead to unemployment until they train for a new position.
• Technology has reduced the need for their type of position.

http://www.tradingeconomics.com/ireland/unemployment-rate

Ireland Unemployment Rate 1983-2015 | Data | Chart | Calendar | Forecast

Irish seasonally adjusted jobless rate decreased to 9.4 percent in September of 2015 from 9.5 percent in the previous three months. The unemployment rate reached a fresh 7-year low, due to a slight drop in the number of unemployed. A year ago the unemployment rate was recorded at 10.9 percent. Unemployment Rate in Ireland averaged 10.97 percent from 1983 until 2015, reaching an all time high of 17.30 percent in December of 1985 and a record low of 3.70 percent in December of 2000. Unemployment Rate in Ireland is reported by the Central Statistics Office Ireland.

Irish current Unemployment 9.4 percent in September of 2015 which is a 7-year low for the heights of over 15%, these latest figure are in no bout helped by high levels of migration within the last number of years, the question is will Ireland face a skill shortage in the coming years, and is it now time to look at the Irish immigration policy to fill the skills gap.[pic 12]

Irish Corporation tax

According to Turley & Maloney there are at least three reasons for the existence of significant levels of taxation within Ireland. First, the state needs to finance the provision of public services (e.g. roads, education and health).Second, the state needs to generate funds in order to redistribute income (e.g. unemployment assistance payments). Third, the state may use taxes in order to alter behaviour (e.g. taxes on energy consumption.