Economic Change and Urban Development - Assignment Example

NОMIС СHАNGЕ АND URBАN DЕVЕLОРMЕNT Name Institutional Affiliation Tutorial 2: What does it mean to claim that neoliberalism is being urbanized? Certainly, you may have heard that neoliberalism is being urbanized since it’s a trend in the recent years. Neoliberalism is most people don’t understand what neoliberalism is all about since it’s hardly on the national television. However, neoliberalism is a very vast subject, and it is a factor that has been trending for the last few years. It can be divided into either political or economic neoliberalism. In this essay, we will discuss what neoliberalism is and how it is being urbanized. There is a very significant difference between economic neoliberalism and political neoliberalism. In economic neoliberalism, it is believed that maximum economic development can be achieved by shifting the economy from the public sector to the private sector. It is done by implementation of policies such as tax cuts, privatization, globalization and deregulation. The economic view of neoliberalism has been criticized by many people saying that it is only meant to promote self-interest and not the general public interest. It has also been stated that it is the cause of the widening gap between the poor and the rich. The rich continues to become richer while the poor gets poorer. On the other hand, political neoliberalism is used as a strategy to prevent social conflict. It is usually presented to the poor and the working people in the society whereby the government promises little or no interference. This is done by reducing taxes (Brenner and Theodore, 2005). Defining neoliberalism is not as easy as defining any other word. It is because the word has two primary meanings that are used very differently. This makes it quite difficult for one to understand both meanings and how they are applied in the real world. Neoliberalism is not oftenly used in the news or other public sources hence making it complex to know how and when it was used. People from different races and places move daily to the urban areas. The main reason for this migration is that they are in search of employment. This has made the urban areas be overpopulated with different classes of people. Some of the people in the urban areas are very rich while others are destitute. Implementation of neoliberal has cause both negative and positive effects. For example, the government implemented neoliberal as a political strategy to keep peace in the urban areas. On the other hand neoliberal has adverse effects, for example, it has been the major cause of the widened the gap between the poor and the rich in the urban areas. It is because the government has encouraged the private sector that presented the opportunity for others to enrich themselves (Western, 2007). The implementation of neoliberalism has not been an easy task. The first reason being that it is a form of change and change is not always welcomed by human since they not sure of the results. Secondly, people do not understand what it entails due to lack information. Therefore, makes it complex for it to be implemented. Despite neoliberalism having a positive effect on the economy, it brings about the issue of inequality in the society. These are some of the short comings that are experienced with the implementation of neoliberalism. In conclusion, it is evident that neoliberalism is being urbanized, and the government is embracing it as a major factor in development in most urban centers. The people, however, have been opposing its implementation due to its few short comings. However, it is the government work to educate its citizens about it and ensure they embrace it. Tutorial 3: Has the city-region emerged as the advantaged scale for the economic organization? The Economic organization has been the key factor that contributed majorly to the economic development. Each state or country strive to ensure they achieve maximum economic development. There are several factors that many of those states have embraced in the quest for achieving economic organization. One of those factors includes formation of the city-regions. City-regions are functional regions around a city that consists areas of the local government. It is a concept that has been highly upheld by the economist and urban planners who define it as regions with the divided administration but share markets and resources (Brenner, 2002, p.9). The economic benefits, technological needs, and political changes are among the top factors that have contributed highly to the emergence of the city region. A city region may be formed due to the economic benefits that are realized among the regions. This is because they will be sharing the market and resources which highly contributes to the economic development among the regions. Political change is also another factor that contributes to the emergence of city-regions. When the political differences between different regions have been resolved, the areas can form a city-region despite different administration system. The leaders of the regions will, however, need to come up with few common rules that will govern the association and interaction limits among their people. Technology could also be a major contributor to the emergence of the city-regions. Technology helps us to achieve globalization, and people feel more connected despite the boundaries that exist. It has, therefore, lead to the emergence of city region where the people share resources (Harrison, 2007). Where there is post-Fordist economy, it means that the region majors in the specialized market-based economy. In this economy, there is increased production because each region will specialize in what it can produce best. Specialization is more effective since production is assigned to the professionals who give optimum production considering quantity and quality. In our case of city-region, the people will have to agree on which products to produce and also their standard price. This will ensure the other regions gets what they produce least and sell what they produce best. Those regions that are not part of the city-regions will also experience effects. The effects are both negative and positive. The positive impact that they may experience is increased the quality of products from other regions. Due to specialization in the city-region, the products being produced are normally of higher quality than from other regions. There will also be the creation of jobs in the city-region due to specialization. People will come to these regions to seek employment. On the other hand, some of the adverse effects they may experience is increased prices of goods. They will also not enjoy some privileges like sharing of markets and resources. It is evident that the city-region has proven to be of benefit to the economic organization. This has been due to the many advantages that are associated with the sharing of the market and the vast resources from different regions. The improved quality and availability of employment are also other benefits that are integrated with the city-region formation. Tutorial 5: Has an urban land price bubble existed in Australian Cities over the past two decade? An asset bubble can be defined as a steady increase in the prices of assets such as houses, stocks, and land. These assets become over inflated over a very short period. The rise is not fully caused by the forces of supply and demand in that given region. For example, a land bubble can be caused by the buyers bidding very high prices. Assets bubbles have been said to be the cause of unfair competition in the market. In the past years, there has been an enormous increase in the land prices in Australia. Demand and supply factors have been blamed to have been the causing of the sudden rise in land price, but this is not the case in Australia. Demand and supply factors can explain just a little of the price increase but some factors such as high bidding, demographic change, and land banking can be termed as the major cause of increase in the price of land. When land is declared for sale, a few people may identify it as a good land that they would like to buy. This will require them to bid, and may result in a higher price (Dollery, Crase and Johnson, 2006, p.92). As per demographic change, it can be caused by a change in climate which may cause people to prefer one area to another making them migrate. Land banking is when one buys a piece of land and preserves it to sell at a future date. Land banking is normally done for land that has the potential of appreciating. This may cause a shortage of land and in return makes a customer desperate to offer a higher amount of money (Simon, 2003). Land prices are not the same in different places and also differ when it comes to their uses. There is some relation to the land price increase across different regions. Land use is divided into residential, commercial and rural land. The price of residential land is very high in comparison to the commercial and rural land. It is surprising that commercial and rural land prices are not rising as fast as the residential land. The place where the land is located has an influence on the rate of rise in prices. For example, in 2014, land increase was as follows; in the New South Wales, there was 37 % increase, 46 % increase in Victoria and 21 % increase in Queensland (McGuirk, 2003). This shows land prices are not equal all over a state. There is a little expectation in the coming few years; land prices are estimated to fall due to the economic circumstances. Some of those economic circumstances are a reduction in land tax, reduced loan limit, and government policies that do not favor the increase in the price of land. The effect of land tax has a direct influence on its price. Reduction in credit or loan limit will have a significant effect on reduction in the land prices. When people have little cash at hand, there will be no high bids on the land prices. The government can introduce policies such as one that will prevent people from land banking hence decrease land bubbling (Balchin, Bull, and Kieve, 1995). It is evident that the land bubble has existed in the last two decades in Australia. This has been caused by several factors such demand and supply forces and high bidding. The Australians have contributed to the asset bubble, and they can play their part to ensure it reduces. The government can implement policies such as standardization of prices to ensure asset bubble is no longer experienced. References Balchin, P.N., Bull, G.H. and Kieve, J.L. (1995) Urban Land Economics and Public Policy, 5th edition, Macmillan, pp.12-18, 48-50, 90-94, 168-180. Brenner, N. (2002) ‘Decoding the Newest “Metropolitan Regionalism” in the USA: A critical overview’ Cities, 19(1), pp.3-21. Brenner, N. and Theodore, N. (2005) ‘Neoliberalism and the urban condition’ City, 9(1), pp.101-107. Dollery, B., Crase, L. and Johnson, A. (2006) Australian Local Government Economics, University of New South Wales Press, Sydney, pp.60-63, , pp.72-76, 84-88, 90-95, 258-271. Harrison, J. (2007) ‘From competitive regions to competitive city regions: a new orthodoxy, but some old mistakes’ Journal of Economic Geography, 7, pp.311-322. McGuirk, P. (2003) ‘Producing the capacity to govern in global Sydney: a multi-scaled approach’ Journal of Urban Affairs, 25(2), pp.201-223. Simon, J. (2003) Three Australian asset price bubbles, Paper presented at Reserve Bank of Australia Conference on Asset Prices and Monetary Policy, 18-19 August Western, M. et al. (2007) ‘Neoliberalism, Inequality and Politics: The Changing Face of Australia’ Australian Journal of Social Issues, 42(3) pp. 401-418. Read More