Business Environment of the Maldives Essay Example

Business Environment of the Maldives Paper Market forces affect organizational responses to supply and demand, where those responses and behavior are shaped via cultural environment such as economics, socio- culture, technology, etc. In this regard if business is successful or finds it slow in expansion, it may consider globalization via international trade. In this report, the consequences of globalization and impact of EX. Policies are studied and analyzed in arriving conclusion. Introduction The combination of internal and external factors such as: competition; clients and suppliers; improvements in technology; laws and government activities; and market, social and economic trends that influence a companys operating situation, is known as business environment. In its environment, buyers and sellers interacts differently forming various competitive and non-competitive structures monopoly, oligopoly, perfect competition, monopolistic, etc. The basic analysis of different types of markets remains the same, as the quantity emended refers to the quantity of a good or service that households are willing and able to purchase at a particular price the effective demand. People would like to own luxury items that they could not afford making the demand ineffective. Pricing decision Of organizations are influenced by the behavior of its competitors and the market forces within the environment. We will write a custom essay sample on Business Environment of the Maldives specifically for you for only $16.38 $13.9/page Order now We will write a custom essay sample on Business Environment of the Maldives specifically for you FOR ONLY $16.38 $13.9/page Hire Writer We will write a custom essay sample on Business Environment of the Maldives specifically for you FOR ONLY $16.38 $13.9/page Hire Writer Professor Michael Porters Five Forces Model in 1980 identifies those factors which are likely to affect an organizations competitiveness. This simple, but powerful tool undermines where power lies in any business situation. These ores can create threats to marketers. Also they generate opportunities for new products and new methods of reaching customers. In the event of slow market growth, regulatory obstacles or market saturation, organizations consider factors like industry analysis, ways of exporting, etc. To go global. UK organizations are known international traders, influenced by free trade policies of European Union. The persistent inability to get a grip on the current Euro crisis has led international attention to focus on Europe not as a promising market of tomorrow, but as a potential source of turbulence in he months and years to come (Paleozoic, 2013). Though the policies have its disadvantages, most organizations take advantages of social, employment, environment and competition policies as granted. This report is made through research of scholarly articles, published and downloaded e-books. Some illustrations are extracted from such materials, while others are own work. A great effort is made to present the report as user-friendly, and understandable down to the lowest knowledge of readers. It is unfortunate that the report requires limited word count for such topic, where wider explanations and rich contextual is inevitable. Lack of resources and time (being a fulfillment co-academic and administrative staff) was highly challenging. Organizational behavior in their market environment Behavior Of organizations depend on barriers to entry and the influence Of competitors. In oligopolies industry, firms display mutual interdependence. If for example, one distributor lowers its gas price, subsequently other distributor would lower its prices to stay competitive. In development of oligopolies industry, firms often merge into create a duopoly. In more advanced situations and high concentration on profit taking, a monopoly occurs, where there is no competition and nil impact on their decisions from rivals. Market structure In describing market structure, Worthington and Britton (2006) refers to the amount of competition that exists in a market between producers, and further declares that the degree of competition can be thought of as lying along a continuum with very competitive markets at one end and markets in which no competition exists at all at the other end. Market structure relates to the factors that determine interaction of buyers and sellers, and the level of interaction of production and selling process, by emphasizing: number of rims, nature of products, degree of monopoly power and Influence on price, profit levels, firms behaviors on competition and output levels, magnitude of entry barriers, and impact on efficiency. Basic Market Structures: The Mammalian market structure The Mammalian market comprise of competitive market which consists producers/sellers competing with each other to satisfy needs of customers in a perfect competition with lack of product differentiation, and selling at cost or just above, and non-competitive market which comes into existence to make profit, with positive differentiation of their product or reducing number f other businesses in the market. BP (2010) argues that the lower the barriers (obstacles that deter new firms from entering a market to compete with the existing firms, gives a degree of market power such that decisions can be made by existing firms without risking their market share) the more likely to become a perfect competition. The higher the barriers to entry and exit the more prone a market tend to be a natural monopoly. The geographical challenges and scarcity of resources anticipates higher prices, in order to cover heavy capital cost, or for simply earning high profit. Vehicle (1976) quotes state ownership of the means of reduction creates monopoly of economic and political power and makes unification of both under the control Of a social group personifying the state, as summarized by Discovered. Being the public natural monopolist the only one firm, in supplying tap-water for essentialist, MASC.. Has important consequences for both price setting and quantity produced. It has a very high barrier of capital costs (e. G. , setting up a national network of pipes and sewage systems), making it impractical to have more than one firm. Barriers will normally be necessary to protect a monopoly from competition. MASC.. Is the price maker. But, as it involves government and mutual interest (necessity) of the people, MASC.. Would not limit output to receive monopoly profit. Nor would allow prices to exceed incremental cost (the change in capital and operating costs arising from increasing output) to become commercially viable. Rather, would consider locative efficiency where production is at least cost and prices equal to marginal cost. To reduce the negative impact on society, government often try to limit the market power of the monopolists. Ah alertest (2008), strongly suggests that if the market price under perfect competition would have been known, the government can ecocide on a price ceiling at that price. Then the equilibrium point is moved to the optimal point from society viewpoint. However, it is very difficult to estimate the optimal price. It may well be wrong to conclude that monopolies can charge any price they like. A monopolist has price-setting power and will look to earn high levels of profit. However the firm is controlled by the position of its demand curve, which is consequential in charging a price that the consumers in the market cannot bear. Resultant to market demand curve being its own demand curve as a sole supplier, monopolist faces a downward loping AR (average reeve u) curve with a MR.. (marginal revenue) curve with twice the gradient of AR. Therefore, the position and the elasticity of the demand curve acts as a limitation on the pricing behavior of the monopolist. Presumptuous on firm aiming to maximize profits (where marginal revenue = marginal cost) a short run equilibrium is established as shown in the diagram below. Market forces and organizational responses Market forces affect organizational responses in supply, demand, and marketing. Worthington and Britton (2006) justifies that the three problems of hat, and how to produce and how to distribute are solved by market forces. Supply and demand have an inverse relationship (e. G. , when new milk powder is placed in the market. The supply of the milk is greater than the demand for that particular milk consumer will need more information of the product and time to adapt it causing increase in the demand or product extinction). Thus organizations need to reach the equilibrium (the ideal point), where supply and demand are equal. Marketing activity can change the equilibrium point in supply and demand, by increasing demand of a good or service, hereby shifting the equilibrium, where supply and demand meet the consumers needs. Market forces in the Maldives and how it shapes the responses of organizations Porters Five Forces Model gains insight into the competitive strength of a businesss current position, and future movements, as well. It helps in taking advantage of situational strength, avoid mistakes and improve weaknesses. Slogan (2008) ratifies that the greater the competitive advantage of a firm, whether through lower costs or through less elastic demand for its products, the greater the rate of supernormal profit it ill be able to make. Natural monopolies like MASC.. Are incontestable and firms have no real competition. Rather, market forces are proper for an oligopolies industry whereby firms display mutual interdependence. Hence, Ordered a telecommunication company sharing duopoly in mobile service with Diarrhea Pet. Ltd. (landlines monopolist), and internet service providing oligopoly with Arcane Online and Diarrhea in Maldives, is considered. Redos pricing and output decisions depend on its barriers and behavior of its competitors which gives firms a degree of market power such that decisions can be made y existing firms without risking their market share. If Ordered sets a price higher than that charged by others, the company can expect to lose sales. Redos respond towards demand Demand for a goods or services depends on a number of factors; disposable income, the price of the other goods, tastes etc. Price- Fall in the price of an item increases demand, being affordable to more individuals with lower income. Thus the overall size of the market increases. Ordered (then Watching) penetrated market with revolutionary low price disturbing the monopoly of Diarrhea, resulting extreme demand for their services. Substitute People changes from one product to another, as the relative prices changes, or service becomes more functional. Ordered introduced, user specified time delivery on SMS, international credit transfer, and innovative service like emergency credit on prepaid service. According to Whaley (201 0), Innovation as an approach in competition theory; it shifts competitive advantage when rivals either fail to perceive the new way of competing or are unwilling or unable to respond. It does so with greater speed being based in real market needs. Complementary products customers are fond of free and complimentary items. Ordered introduced free credit on prepaid subscription, free minutes, free data, family remuneration packages, and organizational packages with inter organizational free calls (e. G. Police package). Redos respond towards us apply Supply depends largely on price. If a product can be sold at a higher price, businesses will supply more of that product. Change in technology leads to introduction Of new products, changes (in methods of production, in quality of resources and products, in ways of distributing the product) and new ways of storing and disseminating information (Worthington and Britton 2006). Developments which reduce costs of production will increase the quantity of a product supplied at a given price. Costs of making the product -To expand, run and sustain in a geographically scattered nation with lowly populated communities, Ordered need to pay wages, build network towers and number of distribution base stations, which is costlier than single large scale setup. Ordered has strategically steady policy in this regard, gradually covering the mobile and internet web around the country. According to Ordered (2014), they have launched G in Mafiosi and G+ in Diffuses along with 30 additional islands. How the business and cultural environments shape the behavior of MASC.. The forces of marketing environment, surrounds the customer and the marketing mix. It can create threats to marketers, and can generate opportunities for new products and new methods of reaching customers as well. Political environment: Government is responsible for providing a stable framework for economic activity and, in particular, for maintaining and improving the physical, social and market infrastructure (BP, 2010). Worthington and Britton (2006), allege that the governments exercise of power and the ideological foundations helps to indicate the nature of the lattice system and its likely approaches to the resolution of conflicts. However, Infancy of the political situation (multi-party system) has its complications and uncertainty over regulatory systems in Maldives. MASC.. Being government monopoly, and regulatory body of water and sewerage system, it has controlled and maintained a quality service. Its decisions are publicly trusted. Economic environment: consists of external factors in a business market and the broader economy that can influence a business, playing a critical role in determining the success or failure of a business. For example, high interest rates lags borrowing for business expansion, high unemployment rate may obtain cheap labor, while too high, may result in a recession and less consumer spending causing in insufficient sales to keep the business going. Exchange rates can either help or hurt the exporting of products to specific foreign markets, and tax rates will take a chunk of the income. Socio-cultural environment: can clearly be defined as behavior that exists within a population in the mean of beliefs, customs, and practices. This has much influence on International companies (e. G. International companies often include an examination of the socio-cultural environment prior to entering their target markets and set their approach as closely to the culture Of new environment), influencing on demand and supply. The type of products being produced or sold, the markets they are sold in, the price at which they are sold and a range of other variables are highly influenced by the cultural factors. People are a key organizational resource and a fundamental part of the market for goods and services (Worthington and Britton, 2006). Since MASC.. Operates in its mother culture, the influences are naturally defined. But, they are yet to calculate demographic values more recesses in accordance to the development projects in wider geographical locations. It has to implement strategies opposite to its industrial context and immediate response is urged under growing scarcity of fresh water in certain islands around the country. MASC.. Exercise segmentation profits, by dividing market into domestic users and institutional users, and applying variable prices system. Technological environment: increases output by gains in productivity, reducing cost and producing new items and changes in workplace (e. G. Social networks, virtual meetings, enterprise software packages, etc. ). It removes boundaries and reduces human errors of work and stress, by facilitating information at the workplace which accelerates quick decision making, and transforms business activities involving the collection, handling and analysis of information. Changes can be resisted if same production processes for many years or a large number Of Veteran employees being used. Proper training and adaptation must be exercised for new production technology to be welcomed by demonstrating how it will make their jobs easier in the long run. MASC.. Must consider proper technology, for being lawfully responsible for wellbeing of community, to face arioso challenges of natural disasters, scarcity of fresh water, regulating and monitoring desalination and sewerage procedures in tourism industry, maintaining quality assurance of various bottled water producers in the country. Significance of the global factors that shape national business activities Profitability is of crucial importance for most private-sector businesses. Significant business growth may only be possible through international expansion, while home market becomes difficult because Of slow market growth, regulatory obstacles or market saturation. As reparability depends on competitiveness, globalization may reduce cost in a competitive international market, increasing scale of production and enabling company to achieve reputation. Organizations require self-evaluation of its determination and readiness against the factors affecting globalization: International Trade: affects livelihood of the present world. It is huge, and growing faster than countries internal economies around the globe. It is the exchange of goods, services, and capital among various countries and regions. The international trade accounts for a good part of a countrys GAP, ND is one of the important sources of revenue for a developing country. The biggest challenges for business organizations in the UK is learning how and where to trade overseas. International trade is an economic necessity in an interdependent world. Being an open economy, UK established information center on international trade opportunities. It provides dedicated market support with services tailored for each organizations needs in order to effectively interact in international trade: market research information export promoters professional help various methods of conducting business particularly in a specific country help tit cultural requirements coordinating in bringing key contacts to the LIKE helping I-J organizations market themselves overseas by granting visit to countries and exhibiting at international trade shows Significance of international trade to UK business organizations International trade can be made in a mutually beneficial manner, provided each country has comparative advantage to manufacture products to be traded. F-or example, England can produce cloth for lower prices than Maldives, while Maldives can produce tuna fillets for lower prices than England. Accordingly, both England and Maldives can consumer maximize amounts of cloth and nun fillets if they focus on producing products within their relative advantage in engaging in international trade. Market Opportunities: A potentially favorable condition in which a business can capitalize on a changing trend or an increasing demand for a product by a demographic group that has yet to be recognized by its competitors. For a market opportunity to exist, a company must be able to identify who its potential customers are, the specific needs that need to be met, the size of the market, and its capacity to capture market share (Investigators, 2014). Global Growth: A positive change in the bevel of production of goods and services by a country over a certain period of time, where nominal growth is defined as economic growth including inflation. Real growth is nominal growth minus inflation. The economic growth is usually brought about by technological innovation and positive external forces. Impact of the European Union policies on business organizations In recognition of the benefits of free trade within the E, the member countries signed the Single European Act of 1986. This sought to dismantle all barriers to internal trade within the EX. By 1 993, and create a nine single market (Slogan, 2008). The member countries are required to follow several policies: Competition policy is basically about making sure that companies compete with each other on an equal footing on the basis of their products and prices with no unfair advantages (European Commission, 2012). Its reforms allow markets to work more efficiently for the benefit of consumers and drive sustainable economic growth. EX. Growth Program prioritize investment in innovation, including research and development, skills, low carbon, employment and social inclusion. European society is being hanged in the influences such as technological progress and the globalization of trade. The employment, social affairs and equal opportunities policies contribute to improving peoples living conditions with a view to sustainable growth and greater social solidarity. In the early asses EX. Committed to the environment: for protection of air and water quality, conservation of resources and protection of biodiversity, waste management and control of activities which have an adverse environmental impact, at both Member State level and internationally, through corrective measures or cross-cutting measures. Ordered, if being operated under EX. Policies, the barriers would have been justified, of higher market share allowing recovery of costs for establishing landlines. The growth and employment opportunities would adverse through MME regulations and free movement. Provisions ensures free competition, rather than cartels and monopolies sharing out markets and fixing prices, which would enhance consumer satisfaction conveying expansion of business and growth in job market, and profit minimization. Conclusion While monopoly telecommunications revenues are protected, the risk Of alienating both the business sector and the growing numbers of electrification subscribers in EX. Is high. Carriers need to develop and maintain a forward-looking plan to rebalanced domestic tariffs and renegotiate international tariffs so that both become more cost-based in the face of competitive and political threats. At the same time that new carriers enter, there will be opportunities for unavoidable carriers to acquire firms in related markets or to form alliances with these firms. By developing new service offerings, if necessary with outside partners, they can continue to be the carrier of choice. The markets where margin between costs and prices is likely o remain at above-normal levels, profit margins may be earned in international value added services for business customers, and may be international gateways and international transmission via satellite.

Acid Rain Essays (310 words) - Carbonates, Acid Rain, Free Essays

Acid Rain Essays (310 words) - Carbonates, Acid Rain, Free Essays Acid Rain Acid Rain Acid rain forms high in the clouds in a gaseous form. Theses gasses stay in the atmosphere until they come in contact with rain that dissolves the gasses. A mild solution of sulfuric and nitric acid is formed. These drops fall to the earth and get into our water table beneath the surface. From there they are collected into streams, rivers, and lakes that eventually will lead to the ocean. Rain isn't the only form acidity falls to the earth. About half of all the acidity falls back through dry deposition as gasses and dry particles. The wind blows the acid particles onto cars, homes, trees, and buildings. The acid discharge is then washed from the surfaces by rain. The runoff adds to the acid already in the rain. And adds to the acidity of the water. Air pollution isn't the only way acid rain forms. Lightning is nature's way of forming acid rain. When lightning strikes, it breaks nitrogen's triple bond, it then combines with O2 and then with water in the atmosphere to form HNO3 Acid rain changes the pH of lakes and oceans, which can affect the lives of plants and animals that live there. The rain also reacts to buildings made of marble. Marble is made out of Calcium Carbonate and when mixed with acid rain it forms Carbonic acid. This acid will decompose further to Carbon dioxide and water. This will dissolve the marble buildings. Countries with a great acid rain problem have been forced to encase their sculptures in a transparent case to prevent corrosion. The only way to try to prevent it from occurring is by scrubbing the coal. This process gets rid of the sulfur impurities that could be extracted from the coal. This solution is very expensive but is the only way to remove the sulfur from the coal.

Characteristics of Successful Entrepeneurs Essay

Characteristics of Successful Entrepeneurs - Essay Example Significance of the Research When it comes to business, what makes one successful entrepreneurship is undoubtedly one of the most significant topics because successful entrepreneur finds business opportunity, seizes it and creates a market of his own by beating the competitors and achieving sustainable competitive advantage. Studying and exploring in to the essential characteristics of an entrepreneur would be helpful to understand what makes an entrepreneur and how he brings success to enterprises. As Volery, Doss and Mazzarol (p. 1) noted, entrepreneurship remains to be a driving force in the modern economy more than ever. It’s because, entrepreneurs meet the economic needs through the creation of thousands of business every years. Many businesses in recent days started ‘downsizing’ or ‘outsourcing’ processes, but entrepreneurs are those who create new ventures and new jobs that help strengthen the economy as a whole. Entrepreneur has played pivotal roles in today’s business developments, technological advances and all the radical changes that brought renaissance in business environments. People all over the world are able to meet their varying requirements and specific individual needs only because entrepreneurs in different parts of the world, no matter how smaller or larger they are, have found opportunities, thought creatively, innovated and established an enterprise to provide something valuable to the people. Characteristics of Successful Entrepreneurs Many researchers have obviously agreed with the very fundamental view of entrepreneurship as described by the father of entrepreneurship, Joseph A Schumpeter. According to him, entrepreneurship is innovation (Carsrud and Brannback , p. 7). Entrepreneur is one who perceives or finds an opportunity to be seized and then to create a new product or service or changes an existing one in order to create new marketable contribution to the economy (McDaniel, p. 57). An entr epreneur is not only an opportunity finder, but be a good manager with basic managerial skills like direction, coordination, supervision, decision making, risk bearing, control and problem solving etc (Brockhaus, p. 1). An entrepreneur doesn’t need to be a manager or not to function as a manager, but he must be skilled in managerial qualities and functional areas like those mentioned above. A basic difference that most literatures have described is that a manager is not always the owner of the enterprise and therefore he is relatively less responsible where as the entrepreneur is the owner of the business and more responsible too. The most essential and basic characteristics of entrepreneur are detailed below: Entrepreneur as an Innovator Innovation is one of the fundamental qualities of an entrepreneur. As Drucker (p. 17) noted, innovation is very specific tool that an entrepreneur is essentially required to have and with this he can find chances and make them opportunities for various business purposes. Finding opportunities for some thing new and bringing a vision in to reality through innovation is thus critical element to the success of an entrepreneur. Entrepreneur needs to be innovator for major innovations, start up of business, developing new products or services for a presently

The television as a product in relation to edward de Bono thinking hat Assignment

The television as a product in relation to edward de Bono thinking hat - Assignment Example The television has become an evident product in the today’s generation. The television provides communication services to individuals. The television empowers lives in many ways especially through providing important information. Through the television, we have an idea of the global happenings. Through the television information on sports, current good or bad happenings air at the comfort of our homes. Information on the weather enables people to plan for events before they happen. The television is a good source of entertainment accessed at a cheap price and at the convenience of others. Television definitely empowers individuals to live a better life through showing the progress of global happening (Hanson, 2010). Experts denounce the watching of television due to reasons such as the disengagement of people from politics, the obesity issue and the negative images of women it displays. Innovation of the television faces controversies for current years. The fears that it is on ly a matter of time before the television losses market to upcoming technological devices that enhance the outreach. Over the air, the television only has common channel. Individuals result to paying cable and satellite providers to offer extra channels. The consumer market is tired of purchasing more content most of which we are not interested (Lin & Atkin, 2007). Edward de Bono thinking tools The â€Å"Six thinking Hats† is an important powerful tool used to make decisions from different perspectives. Edward de Bono created the tools, which assists individuals to think outside from their normal thinking style. Product producers think in a very rational and positive point of view. This is the reason as to why the end up in success. Many however fail to look at the problems from a creative, intuitive, emotional or negative point of view. This means that the success is only limited to the positive thinking only. They forget that through analysis of the negative aspects creates a better approach of promoting the success of the organization. On a different view, pessimists may extensively support ideas on an emotional aspect failing to analyze decisions rationally and calmly. The thinking technique involves the white hat, red hat, black hat, yellow hat, green hat, and blue hat (Mycoted, 2011). The white hat focuses on the available data where an analysis of information available aids in learning various aspects. While thinking on the aspects, make an analysis of the elements that fill up on information missing. The â€Å"white thinking hat† analyses the past trends and extrapolate from historical data. The red hat thinking involves analyzing problems using gut reaction, emotion and intuition. The thinking involves the emotional aspects of other people involved in the thinking circle. Involving people’s logic assists in analysis of the last reasoning (Runco, 2007). The black hat of thinking involves looking at the negative aspects of the made decision. With defense and caution, analyze on the possibilities of it not working. It is important as it brings out the weak points of the decision. This enables the plan to be refined through elimination, alteration or creation of counter plans. The black hat thinking aspect enables decisions to stand tough grounds and be resilient. It assists in realizing fatal decision making before making a decision. The advantage of this thinking mechanism is that it concentrates on the negative aspects hence eliminating flaws in the decision-making process. This prepares individuals of difficulties arising from the made decision. The yellow hat of thinking concentrates of positive thinking mechanisms. It takes an optimistic point of view giving only the positive outcomes of the decision. The green hat relates to creativity. It involves developing creative solutions to a problem involving a freewheeling with minimal criticism. The blue hat represents the process control. The blue hat

Benefits of Leisure on the Individual

Benefits of Leisure on the Individual Introduction / Summary In previous contributions, there should have been wide discussions to draw the limits of leisure. I would like to get assistance one that you have read those chapters, in order to write some introductory paragraph that lets the reader know if my contribution is particularly related to some other one. In this contribution, I will analyze it by using the subjective well-being approach. I will use the leisure experience dimension (as described bellow), and I will study the determinants of subjective well-being. There will be plenty of conceptual discussion, some regularities will be reported, an empirical exercise will be performed results analyzed, and some insights for future research will be presented. In this paper, we will study leisure and its beneficial aspects over individual welfare by using a quite new approach: the subjective well-being or happiness approach to measure individual welfare. Along the discussion, we will present two main points. First, we will discuss on the dimensions of leisure in order to justify that by using subjective well-being procedures, we can get a comprehensive approximation to the, somehow difficult to measure, leisure concept. Second, to determine which are the personal and environmental factors that are needed so an individual can produce and consume enjoyable leisure experiences. In this chapter, we are not going to consider that leisure is just free time, i.e. time that is not dedicated to market work, nor to household maintenance activities. We are not even going to consider that leisure is discretionary time (Goodin, et al. 2005). What we state is that leisure is a universal human need that has to be fulfilled by the production in the household and the personal consumption of what we may call leisure experiences. Each experience is a commodity that enters directly in the individuals utility function. This means that leisure is one of the arguments of the utility function of the individual, one of the instances from which she will get welfare. By doing this, we will adopt from the beginning a beckerian approach (Becker, 1965, and 1990). Other arguments are (Gronau and Hamermesh, 2006). From that list of commodities, we can agree that leisure is the most time intensive one. Individuals have this particular basic need, leisure, to be fulfilled using the most suitable combination of personal resources. As always, we are living in a scarce world where every input has some alternative use, so people have to make allocation choices about the best way to fulfill this leisure need as well as others such as food, shelter, and so on. However, we will introduce into our analysis a basic feature of leisure: the presence of enjoyable others. Only recently has this aspect been introduced in the economic analysis of leisure (Osberg, 2009). In this paper, we address the question of how personal inputs are optimally combined to satisfy the leisure need in a social context. By means the analysis of the leisure domain satisfaction, we will be able to asses how personal free time transforms into leisure and how this outcome contributes to individual welfare. Each person would define the boundaries of leisure on the basis of her tastes, on different resource availability to fulfill her needs, and may value the final outcome in many different ways depending on the social norms, her personal aspirations, social interactions and past experiences. Since using a personal definition of leisure would make any analysis impossible, we will present the main three different constructions of leisure, as proposed by Kelly (1982). The first approach of leisure is the most basic one that defines leisure as quantifiable leisure time, either residual or discretional, based on the freedom to choose. The second one defines leisure as the activity that is chosen at a given time and place so that it is the quality of the activity which defines it as leisure. The third one defines leisure as a subjective condition on the grounds of a freely chosen experience based on intrinsic motivation. The integrative approach proposed by Kelly is the one that we follow in this research, where Leisure is an action that takes place at a given time, develops an identifiable activity and is perceived as a pleasant experience by the actor. In what follows, we would refer to this last integrative approach either as leisure or leisure experience. Actually, it fits very well with the following definition of leisure satisfaction by Beard and Ragheb (1980). For them, leisure satisfaction is the positive perceptions or feelings that an individual forms, elicits, or gains as a result of engaging in leisure activities and choices. It is the degree to which one is presently content or pleased with her general leisure experiences and situations. This positive feeling of pleasure results from the satisfaction of felt or unfelt needs of the individual. Traditional economic theory studies human behavior by means of individual’s observed choices. In such a spirit, observed time allocation can be an outcome of interest recorded on time-use surveys. Actually, as we will discuss in the concluding section, time-use registers are a very valuable source of information, and many of the questions that we are going to address could be complementarily studied by testing those hypotheses with that type of data. However, even if some authors consider that time is the ultimate source of utility, time by itself provides no utility to individuals, since the mere passing of time does not fulfill any human need (possibly except from sleeping time). Moreover, since we have no means of observing the final leisure output, we have to rely on the subjective assessment of how satisfied people feel with the leisure that they enjoy. At the end of the day, the main challenge is to determine how an unobservable, such as leisure, can contribute to individual welfare. In this case, we are considering a double black-box. First, not everyone defines leisure in the same way and not everyone produces leisure experiences by using the same technology or the same inputs. For some people, the presence of others will be much more needed that for some other people. Some people could be much more materialistic than others. Some people could be much more efficient in the production of pleasurable experiences because of their higher education. Second, as indicated before, we know that leisure contributed to enhance the quality of life of people, but the valuation of those experiences is determined by societal norms and arrangements and by personal aspirations, past experiences and comparison effects. Next section will present the happiness or subjective well-being approach. We will introduce a brief discussion of the rationale for using this approach for economic research and for leisure research. To do so, we will present the domain approach; in this setting, leisure satisfaction will be considered a mediator between individual leisure experience and overall satisfaction or happiness. In section 3, we will discuss the relationship between leisure time and well-being. Other crucial aspects will be discussed in section 4, where we review a series of social and economic factors that are said to influence leisure enjoyment, so leisure has a high quality and contributes to a better quality of life. Particularly, we will report previous findings on the social dimension of leisure, one of the attributes that determine high quality leisure experiences. In that same section, some determinants of overall satisfaction, or of particular domain satisfaction will be discussed. Last, sections 5 and 6 will present, respectively, some conclusions and a brief overview of needed research to better understand the contribution of leisure to a better quality of life. Subjective well-being approach Traditional research on quality of life relied heavily on objective and materialistic indicators of living conditions. Actually, Gross Domestic Product has been the â€Å"champion† indicator when studying the evolution of living standards and when comparing economies (Mankiw, 2007). Under the realm of objective indicators, nearly all non market activities and many aspects of human development, such as leisure, are neglected. New studies have highlighted the superiority of including the subjective approach to the investigation of quality of life in developed and developing societies, and happiness research has become quite of a fashionable and popular topic (Layard, 2006). There is a growing interest on using the subjective well-being approach to analyze living conditions and there has been an emerging literature on social sciences. Among other reasons for that flourishing, we can highlight the following: (i) this approach offers richer insight about the quality of life, and considers other indicators of development apart from the traditional indicators; (ii) nowadays there is more information available about living conditions, opinions and perceptions of people and societies, and; (iii) with this approach it is possible to identify the major needs and problems of the population, which is useful for governments and policy makers (Frey and Stutzer, JEL 2002). Economists and other social scientists broadly define `happiness and `life satisfaction as subjective well-being. Following Diener and Seligman (2004, pp. 4) life satisfaction is defined as a global judgment of well-being based on information the person believes is relevant, while well-being includes all of the evaluations, both cognitive and affective, that people make of their lives and components of their lives. While according to some authors, the terms happiness, subjective wellbeing, well-being, satisfaction and quality of life are somewhat different and each have their own specific meaning, responses in different surveys are highly correlated (Fordyce, 1988; Frey and Stutzer, 2002b), and many analyses use them indiscriminately. In this current study these terms are used with the understanding that they have a similar connotation. The present study will use a bottom-up approach to the analysis of subjective well-being. This approach considers that overall life satisfaction is determined by what is called domain satisfaction; the evaluation of own personal situation on different dimensions of life such as: financial situation, housing conditions, health, leisure, job or education, among other dimensions. Some authors signal the mediator role of those domain satisfactions to determine overall happiness (Cummins, 1996; van Praag et al., 2003; Easterlin and Sawangfa, 2007). In what follows, we will consider that leisure satisfaction has leisure experiences as the main input; higher leisure satisfaction will contribute, in turn, to higher overall satisfaction or happiness. In order to assess the size of different influences upon happiness and satisfaction with life in general, psychologists have been using surveys since long ago, while only recently economists have recognized that there is useful information in a subjective well-being answer as an empirical approximation for the theoretical concept of utility. With the exception of the seminal work of Easterlin (1974), most research has taken place during the last two decades. The existing state of research suggests that, for many purposes, happiness or reported subjective well-being is a satisfactory empirical proxy of individual utility. From the information about the determinants of individual happiness, different situations of economic and social policies inside a country or a region can be analyzed . Frey and Stutzer (2002b) give some important reasons for economists to consider happiness research. First, happiness research can help to evaluate net effects, in terms of individual utilities, for different economic policies. Understanding the determinants of subjective well-being can thus usefully inform economic policy decisions. Second, this research also has relevance to economists because of the effect of institutional conditions such as the quality of governance and the size of social capital on individual well-being. It may also help to solve empirical puzzles that conventional economic theories find difficult to explain. For instance, using this approach it is possible to understand why for several countries since World War ll although they have raised their real income drastically, the self-reported subjective well-being of the population has not increased or has even slightly fallen. Data about happiness are collected through direct questioning via interviews or self-administered questionnaires in which individuals self-rate their happiness on a single item or on a multi-item scale. These scales offer a list of options, which are ranked according to the levels of happiness . Most studies of subjective well-being are based on some variation on the question How satisfied (or happy) are you with your life? The range of possible responses is defined over a scale that varies between datasets (one to four, one to seven, or one to ten), the lowest grades indicating a poor level of life satisfaction. The main use of happiness measures is not to compare levels in an absolute sense but rather to seek to identify the determinants of happiness. The strategy is to use the answers that people give when asked questions about how happy they feel with life. Similar questions are posed with respect to job satisfaction, health satisfaction, housing satisfaction, satisfaction with marital relation, etc. †¦, and leisure satisfaction or satisfaction with leisure time. This study of the different aspects of life is called domain satisfaction. Although this approach could have limitations, as was said by Oswald (1997, p. 1816) if the aim is to learn about what makes people tick, listening to what they say seems likely to be a natural first step. The domains-of-life literature states that life can be approached as a general construct of many specific domains, and that life satisfaction can be understood as a result from satisfaction in these domains of life (Cummins, 1996; van Praag et.al, 2003; Easterlin and Sawangfa, 2007; Rojas, 2006a, 2006b). It is evident that different domains may be distinguished. In many studies, the domains to be analyzed are determined by data availability. For instance, in the British Household Panel Survey leisure satisfaction is split up into two sub-dimensions; namely, the amount of leisure and use of the leisure time (Van Praag and Ferrer-i-Carbonell, 2007); the European Community Household Panel considers only satisfaction with leisure time , and the Latinobarà ³metro only includes satisfaction with the amount of leisure (Rojas, XXXX). Rojas (2007) affirms that the enumeration and demarcation of the domains of life are arbitrary. In addition to this, there are many possible partitions of a human life, and the selected partition depends on the researchs objectives and the available information. For example, Cummins (1996) has argued for a seven-domain partition: material well-being, health, productivity intimacy, safety, community and emotional well-being; van Praag et al. (2003) study the relationship of satisfaction in different domains of life (health, financial situation, job, housing, leisure and environment) and satisfaction with life as a whole. Rojas (2006b and 2007), on the basis of factor analysis, identified seven domains of life: health, economic, job, family, friendship, personal and community. Using information from Mexico , he showed that satisfaction in the family domain is crucial for life satisfaction. Family satisfaction includes aspects of satisfaction with ones spouse, children and with the rest of the family. Rojas also showed that the satisfaction in the health, job and personal domains is also very important for a persons happiness. Satisfaction in areas such as housing and living conditions, financial solvency and income are relatively less important for life satisfaction. Rojas (2007) found that income is an explanatory variable of relevancy for economic and labor satisfaction, but not for family satisfaction or leisure satisfaction. For that reason, it is possible to find situations where a person is satisfied with his/her life while he/she is unsatisfied economically, or where a person is unsatisfied wit h his/her life and, at the same time, his/her economic satisfaction is high (Rojas, 2008b). Empirical research has focused on different factors associated with subjective well-being and satisfaction. In agreement with psychological and sociological studies (Argyle, 1999), economic research has identified a set of personal and social characteristics associated with life satisfaction. Most studies using data from North America and European countries have found the level of reported life satisfaction to be high among those who are married (Blanchflower and Oswald, 2004b; Easterlin, 2003; Carroll, 2007; Clark et al., 2005; Ferrer-i-Carbonell and Frijters, 2004), women (Oswald, 1997; Clark, 1997), whites (Oswald, 1997; Alesina et al., 2004), the well-educated (Blanchflower and Oswald, 2004a; Frey and Stutzer, 2003; Borooah, 2005), the self-employed (Blanchflower, 2000; Blanchflower, 2004; Frey and Benz, 2003; Alesina et al., 2004), the retired (Di Tella et al., 2003), and those occupied with home duties (Di Tella et al., 2003; Borooah, 2005). The relation between an individuals age and happiness seems to be a bit more complex. Many people believe that the quality of life deteriorates with age and that old people should be unhappier than young people since the old tend to have a worse health, less income, and few are married. Nevertheless, many studies have surprisingly thought that old people report levels of happiness comparatively higher than young people, though this effect tends to be small. Frey and Stutzer (2001) have indicated four reasons that can explain this positive relationship between age and happiness: (i) the old have lower expectations and aspirations. For example, an elderly person waits to remain without work and possibly widower, so the effects of the loss will be lower on the old than on the young. (ii) They have little disparity between goals and achievements, since the eldelrlys goals are fixed closer to what reasonably they can reach. (iii) Older individuals have had more time to adjust to their life conditions, and (iv) old people have learned how to reduce the negative events of the life and how to regulate the negative affects. Besides, economists have identified a U-shape in the relationship between age and happiness (e.g. Oswald, 1997; Blanchflower and Oswald, 2004a). This implies a convex shape in the relationship of life satisfaction with age. Life satisfaction decreases with age until it reaches a minimum, increasing afterwards. For North America and European countries this minimum typically occurs in the forties (43 in Frey and Stutzer (2001) and Ferrer-i-Carbonell (2005); 46 in Peiro (2007)). Aspirations and comparisons effects also are important in relation with income and other factors affecting subjective well-being. The individuals reported subjective well-being in the present is based on a norm of what is `bad, `sufficient or `good. Such norms not only depend on the present situation, but also on what the individual has experienced in the past, on what he/she expects to experience in the future and on what other people think and do (van Praag and Ferrer-i-Carbonell, 2004). In relation with income, individual well-being does not only depend on income in absolute terms but also on the subjective perception of whether ones income is adequate to satisfy ones needs. In addition, individual income perception is subject to the individuals own situation, past and present, as well as to the income of other people. The latter reflects the importance of the relative position of individuals in society for their satisfaction with life. This is often referred to as the comparison income or relative utility effect. It is often argued that individuals adapt to new situations by changing their expectations (Easterlin, 2005; Clark et al., 2008). This implies that higher incomes are accompanied by rising expectations that lead to what is known as the hedonic treadmill (Brickman and Campbell, 1971) or hedonic adaptation (Frederick and Loewenstein, 1999). Thus, individuals strive for high incomes even if these lead only to a temporary or small increase in well-being. This ability to adapt would appear to be a ubiquitous feature of the human condition, some recent examples of adaptation in nonmonetary spheres are Lucas et al. (2003) and Lucas (2005) with respect to marriage and divorce, Wu (2001) and Oswald and Powdthavee (2006) for adaptation to illness or disability, and Lucas et al. (2004) regarding unemployment. The comparisons with different social reference groups are also an important factor that has been widely present in the analysis of two dimensions; namely, the analysis of the effect of relative income on financial satisfaction and/or satisfaction with life as a whole (McBride, 2001; Stutzer, 2004; Luttmer, 2005; Clark, Frijters and Shields, 2008) and the influence of unemployment on subjective well-being. A standard result in happiness literature is that the unemployed report significantly lower levels of subjective well-being than other labor force groups (Winkelman and Winkelman, 1998; Frey and Stutzer, 2002). Indeed, the pecuniary and the non-pecuniary costs of the unemployment are that high that adaptation is non-existent (Lucas et al., 2004) or only very moderate (Clark, 2002). Clark (2003) uses seven waves of the British Household Panel Survey to test for social norms in labor market status. In his analysis, he found that the well-being of the unemployed is the higher, the hig her the unemployment rate in a reference group (at the regional, partner, or household level). It seems that, the more unemployment becomes the norm, the less individuals are affected by it (Winkelman, 2006). Lalive and Stutzer (2004), using a different strategy, obtain the same results for information from Sweden. Social interactions could be either a negative or a positive factor. As previously mentioned, an individuals happiness depends on that individuals own relative (or positional) situation or status, and comparison with others, what would expose that individual to negative externalities in terms of peer-effects (Luttmer, 2005) in utility and/or consumption. Alpizar, Carlsson and Johansson-Stenman (2005) show that positionality matters far more for commodities as houses and cars than for vacation and insurance, but also that both absolute and relative consumption matter for each category, these are positional goods. The positive influence of social interactions may come from social relationships and other relational goods or social capital factors. For instance, Rojas (2007), Winkelman (2006), Argyle (1999), among other social scientists have found that social relationships are a major source of well-being. Although marriage is the relationship that has the most influence on happiness, there are other relationships that affect happiness, as well as health and mental health, by providing social support. Argyle (1999 p. 361) refers some studies where it was found that if all kinds of social support are combined, a social support factor is found to have a strong correlation of 0.50 with happiness. Social scientists in many countries have observed that social support or social networks (and the associated norms of reciprocity and trust (Helliwell and Putnam, 2004)) have powerful effects on the level and efficiency of production and well-being, broadly defined, and they have used the term social capital to refer to these effects (Coleman, 1988; Putnam, 2000; Woolcock and Narayan, 2000). Lately, some cross-sectional studies from both sociology and economics have shown the importance of key aspects of social capital such as trust, social contacts and membership in voluntary associations over individual well-being (Inglehart 1999; Putnam 2000; Helliwell 2003 and 2006b; Powdthavee, 2008). In Bowling Alone, Putnam (2000) suggested that people prosper in neighborhoods and societies where social capital is high, that is, where people trust one another and are mutually helpful. Putnam reviewed evidence showing that communities with high rates of volunteer activity, club membership, church membership, and social entertaining (all thought to be indirect manifestations of social capital) all had higher well-being than communities that were impoverish these characteristics. Many studies that use cross-sectional data have shown that individuals with rich networks of active social relationships, that do not include people living in the same household, tend to be happier with th eir lives (Phillips 1967; Burt 1987). Helliwell (2003) reported that well-being is high and suicide rates are low where trust in others is high, and he also found that well-being is high where memberships in organizations outside of work are at high levels. Thus, there is evidence that individuals are more likely to experience high well-being when they live in nations with high social capital than when they live in nations with low social capital, a finding that dovetails with the results of studies on individuals social interactions. Helliwell and Putnam (2004) and Powdthavee (2008) are comprehensive reviews about the importance of social capital factor over subjective well-being. Health status is a factor that can be expected to be an important determinant of life satisfaction. In the 1950s the use of concepts such as welfare, adjustment and mental health had much in common with the traditional concept about happiness (Argyle, 1991). Research on the health-related quality of life was developed in the mid 1970s by health scientists and psychologists in order to track peoples perception of their health status (Gough et al., 2007). This was mainly in response to the need for more sensitive measures to compare treatments for chronic illness and to identify the most cost-effective treatments . Good health is considered an important factor included in the capabilities and the necessary functionalities in order for an individual to face life (Deaton, 2007; Sen, 1999). Since the 1980s the state of health has been identified as an important determinant of life satisfaction, as happy people are healthier, both physically and mentally (Veenhoven, 1991; Argyle, 1999). Co nsequently, poor health, which limits an individuals ability to carry out their daily activities, reduces overall satisfaction. The literature about subjective well-being in Latin American countries is few and very recent. Graham and Pettinato (2001) were some of the first to analyze Latin American countries. Using the Latinobarà ³metro 2000, they found that Latin America is not all that different from the advanced industrial economies in relation to some of the determinants of happiness. Similar to the OECD countries, happiness has a quadratic relationship with age, initially decreasing and then increasing monotonically after 49 years of age. As in the industrial countries, being married had positive and significant effects. In contrast to the advanced economies, a significant gender effect was no found in Latin America. Also, as in the industrial countries, the coefficients for level of wealth were strong, positive, and significant in happiness. When wealth was included in the regressions, the coefficient for education level became insignificant or weakly significant, depending on the regression used. Bein g self-employed or unemployed both had significant and negative effects on happiness. When they included country-fixed effects, the coefficient on self-employment became insignificant. While being unemployed also has negative effects on happiness in the advanced industrial economies, being self-employed has positive effects. The most credible explanation is intuitive and it was given by the authors: most self-employed people in the latter are self-employed by choice, while in developing economies, many are self-employed due to the absence of more secure employment opportunities and live a precarious existence in the informal sector. Other analyses by countries have been conducted in Latin America. Among the most important, Rojas (2006b and 2007), using the domains-of-life approach in Mexico, found that people are on average, more satisfied in the family domain, while they are less satisfied in the consumption, personal and job domains. Rojas (2007) found that income is an explanatory variable of relevancy for the economic and labor satisfaction, but not for either family or leisure satisfaction. Due to that, he found a weak relationship between income and life satisfaction Gerstenbluth et al. (2007) studied the relationship between happiness and health in Argentina and Uruguay using the Latinobarà ³metro 2004. Cruz and Torres (2006), using the Encuesta de Calidad de Vida 2003, tested various happiness hypotheses among Colombians and Cid et al. (2008), using the survey called Salud, Bienestar y Envejecimiento en Amà ©rica Latina y el Caribe (SABE), explored the correlation between happiness and income in the el derly in Uruguay. To our knowledge, the previous studies conducted about Latin America have not included the effect of social capital on subjective well-being, and they have analyzed the self-employment as a homogeneous labor market status. However, when considering the specificity of the leisure domain, we should take into account that while satisfaction with other realms of life may lie upon the valuation of objective situations (such as one’s financial situation, health or housing conditions), satisfaction with leisure brings in an additional challenge as individual’s boundaries of leisure are defined by her perception of what is pleasant (Ateca-Amestoy et al., 2008). Conceptual discussion on the nature of leisure time in contemporary societies Time allocation decisions within the family: economic approaches and models. We will attach to the economic approach to human behavior by Becker (moreover, bring arguments such as those contained in a theory of social interactions). Temporal autonomy is a matter of having discretionary control over your time. Discretionary Time. A New Measure of Freedom (Goodin et al., 2005) Other approaches: we have found these relevant arguments: Veblens theory The omnivore Bourdieus distinction Putnams social capital 3.1. What is Social Capital? There is a traditional consensus that there exists three distincs traditions that conceptualize and analyze social capital. All three would be relevant for our reasoning. Pierre Bourdieu bourdieu2: who conceptualised social capital as the `actual or potential resources that an individual has at his/her disposal as a result of `a durable network of more or less institutionalised relationships of mutual acquaintance and recognition, i.e. membership in a group. Some authors point out that this definition must be viewed as part of his broader concern with developing the different types of capital in order to explain the means by which the social stratification system is preserved and the dominant class-reproduction strategy is legitimised. J.S. Coleman coleman defines it as the set of resources that inhere in family relations and in community social organisations and that are useful for the cognitive or social development of a child or young person. Social relations were viewed by Coleman to make up important `capital resources for individuals by means of processes such as setting `obligations, expectations and trustworthiness, creating channels for information, and setting norms backed by efficient sanctions. These resources may be influenced by factors such as generalised trustworthiness which ensures that obligations are met, the extent to which a person is in Benefits of Leisure on the Individual Benefits of Leisure on the Individual Introduction / Summary In previous contributions, there should have been wide discussions to draw the limits of leisure. I would like to get assistance one that you have read those chapters, in order to write some introductory paragraph that lets the reader know if my contribution is particularly related to some other one. In this contribution, I will analyze it by using the subjective well-being approach. I will use the leisure experience dimension (as described bellow), and I will study the determinants of subjective well-being. There will be plenty of conceptual discussion, some regularities will be reported, an empirical exercise will be performed results analyzed, and some insights for future research will be presented. In this paper, we will study leisure and its beneficial aspects over individual welfare by using a quite new approach: the subjective well-being or happiness approach to measure individual welfare. Along the discussion, we will present two main points. First, we will discuss on the dimensions of leisure in order to justify that by using subjective well-being procedures, we can get a comprehensive approximation to the, somehow difficult to measure, leisure concept. Second, to determine which are the personal and environmental factors that are needed so an individual can produce and consume enjoyable leisure experiences. In this chapter, we are not going to consider that leisure is just free time, i.e. time that is not dedicated to market work, nor to household maintenance activities. We are not even going to consider that leisure is discretionary time (Goodin, et al. 2005). What we state is that leisure is a universal human need that has to be fulfilled by the production in the household and the personal consumption of what we may call leisure experiences. Each experience is a commodity that enters directly in the individuals utility function. This means that leisure is one of the arguments of the utility function of the individual, one of the instances from which she will get welfare. By doing this, we will adopt from the beginning a beckerian approach (Becker, 1965, and 1990). Other arguments are (Gronau and Hamermesh, 2006). From that list of commodities, we can agree that leisure is the most time intensive one. Individuals have this particular basic need, leisure, to be fulfilled using the most suitable combination of personal resources. As always, we are living in a scarce world where every input has some alternative use, so people have to make allocation choices about the best way to fulfill this leisure need as well as others such as food, shelter, and so on. However, we will introduce into our analysis a basic feature of leisure: the presence of enjoyable others. Only recently has this aspect been introduced in the economic analysis of leisure (Osberg, 2009). In this paper, we address the question of how personal inputs are optimally combined to satisfy the leisure need in a social context. By means the analysis of the leisure domain satisfaction, we will be able to asses how personal free time transforms into leisure and how this outcome contributes to individual welfare. Each person would define the boundaries of leisure on the basis of her tastes, on different resource availability to fulfill her needs, and may value the final outcome in many different ways depending on the social norms, her personal aspirations, social interactions and past experiences. Since using a personal definition of leisure would make any analysis impossible, we will present the main three different constructions of leisure, as proposed by Kelly (1982). The first approach of leisure is the most basic one that defines leisure as quantifiable leisure time, either residual or discretional, based on the freedom to choose. The second one defines leisure as the activity that is chosen at a given time and place so that it is the quality of the activity which defines it as leisure. The third one defines leisure as a subjective condition on the grounds of a freely chosen experience based on intrinsic motivation. The integrative approach proposed by Kelly is the one that we follow in this research, where Leisure is an action that takes place at a given time, develops an identifiable activity and is perceived as a pleasant experience by the actor. In what follows, we would refer to this last integrative approach either as leisure or leisure experience. Actually, it fits very well with the following definition of leisure satisfaction by Beard and Ragheb (1980). For them, leisure satisfaction is the positive perceptions or feelings that an individual forms, elicits, or gains as a result of engaging in leisure activities and choices. It is the degree to which one is presently content or pleased with her general leisure experiences and situations. This positive feeling of pleasure results from the satisfaction of felt or unfelt needs of the individual. Traditional economic theory studies human behavior by means of individual’s observed choices. In such a spirit, observed time allocation can be an outcome of interest recorded on time-use surveys. Actually, as we will discuss in the concluding section, time-use registers are a very valuable source of information, and many of the questions that we are going to address could be complementarily studied by testing those hypotheses with that type of data. However, even if some authors consider that time is the ultimate source of utility, time by itself provides no utility to individuals, since the mere passing of time does not fulfill any human need (possibly except from sleeping time). Moreover, since we have no means of observing the final leisure output, we have to rely on the subjective assessment of how satisfied people feel with the leisure that they enjoy. At the end of the day, the main challenge is to determine how an unobservable, such as leisure, can contribute to individual welfare. In this case, we are considering a double black-box. First, not everyone defines leisure in the same way and not everyone produces leisure experiences by using the same technology or the same inputs. For some people, the presence of others will be much more needed that for some other people. Some people could be much more materialistic than others. Some people could be much more efficient in the production of pleasurable experiences because of their higher education. Second, as indicated before, we know that leisure contributed to enhance the quality of life of people, but the valuation of those experiences is determined by societal norms and arrangements and by personal aspirations, past experiences and comparison effects. Next section will present the happiness or subjective well-being approach. We will introduce a brief discussion of the rationale for using this approach for economic research and for leisure research. To do so, we will present the domain approach; in this setting, leisure satisfaction will be considered a mediator between individual leisure experience and overall satisfaction or happiness. In section 3, we will discuss the relationship between leisure time and well-being. Other crucial aspects will be discussed in section 4, where we review a series of social and economic factors that are said to influence leisure enjoyment, so leisure has a high quality and contributes to a better quality of life. Particularly, we will report previous findings on the social dimension of leisure, one of the attributes that determine high quality leisure experiences. In that same section, some determinants of overall satisfaction, or of particular domain satisfaction will be discussed. Last, sections 5 and 6 will present, respectively, some conclusions and a brief overview of needed research to better understand the contribution of leisure to a better quality of life. Subjective well-being approach Traditional research on quality of life relied heavily on objective and materialistic indicators of living conditions. Actually, Gross Domestic Product has been the â€Å"champion† indicator when studying the evolution of living standards and when comparing economies (Mankiw, 2007). Under the realm of objective indicators, nearly all non market activities and many aspects of human development, such as leisure, are neglected. New studies have highlighted the superiority of including the subjective approach to the investigation of quality of life in developed and developing societies, and happiness research has become quite of a fashionable and popular topic (Layard, 2006). There is a growing interest on using the subjective well-being approach to analyze living conditions and there has been an emerging literature on social sciences. Among other reasons for that flourishing, we can highlight the following: (i) this approach offers richer insight about the quality of life, and considers other indicators of development apart from the traditional indicators; (ii) nowadays there is more information available about living conditions, opinions and perceptions of people and societies, and; (iii) with this approach it is possible to identify the major needs and problems of the population, which is useful for governments and policy makers (Frey and Stutzer, JEL 2002). Economists and other social scientists broadly define `happiness and `life satisfaction as subjective well-being. Following Diener and Seligman (2004, pp. 4) life satisfaction is defined as a global judgment of well-being based on information the person believes is relevant, while well-being includes all of the evaluations, both cognitive and affective, that people make of their lives and components of their lives. While according to some authors, the terms happiness, subjective wellbeing, well-being, satisfaction and quality of life are somewhat different and each have their own specific meaning, responses in different surveys are highly correlated (Fordyce, 1988; Frey and Stutzer, 2002b), and many analyses use them indiscriminately. In this current study these terms are used with the understanding that they have a similar connotation. The present study will use a bottom-up approach to the analysis of subjective well-being. This approach considers that overall life satisfaction is determined by what is called domain satisfaction; the evaluation of own personal situation on different dimensions of life such as: financial situation, housing conditions, health, leisure, job or education, among other dimensions. Some authors signal the mediator role of those domain satisfactions to determine overall happiness (Cummins, 1996; van Praag et al., 2003; Easterlin and Sawangfa, 2007). In what follows, we will consider that leisure satisfaction has leisure experiences as the main input; higher leisure satisfaction will contribute, in turn, to higher overall satisfaction or happiness. In order to assess the size of different influences upon happiness and satisfaction with life in general, psychologists have been using surveys since long ago, while only recently economists have recognized that there is useful information in a subjective well-being answer as an empirical approximation for the theoretical concept of utility. With the exception of the seminal work of Easterlin (1974), most research has taken place during the last two decades. The existing state of research suggests that, for many purposes, happiness or reported subjective well-being is a satisfactory empirical proxy of individual utility. From the information about the determinants of individual happiness, different situations of economic and social policies inside a country or a region can be analyzed . Frey and Stutzer (2002b) give some important reasons for economists to consider happiness research. First, happiness research can help to evaluate net effects, in terms of individual utilities, for different economic policies. Understanding the determinants of subjective well-being can thus usefully inform economic policy decisions. Second, this research also has relevance to economists because of the effect of institutional conditions such as the quality of governance and the size of social capital on individual well-being. It may also help to solve empirical puzzles that conventional economic theories find difficult to explain. For instance, using this approach it is possible to understand why for several countries since World War ll although they have raised their real income drastically, the self-reported subjective well-being of the population has not increased or has even slightly fallen. Data about happiness are collected through direct questioning via interviews or self-administered questionnaires in which individuals self-rate their happiness on a single item or on a multi-item scale. These scales offer a list of options, which are ranked according to the levels of happiness . Most studies of subjective well-being are based on some variation on the question How satisfied (or happy) are you with your life? The range of possible responses is defined over a scale that varies between datasets (one to four, one to seven, or one to ten), the lowest grades indicating a poor level of life satisfaction. The main use of happiness measures is not to compare levels in an absolute sense but rather to seek to identify the determinants of happiness. The strategy is to use the answers that people give when asked questions about how happy they feel with life. Similar questions are posed with respect to job satisfaction, health satisfaction, housing satisfaction, satisfaction with marital relation, etc. †¦, and leisure satisfaction or satisfaction with leisure time. This study of the different aspects of life is called domain satisfaction. Although this approach could have limitations, as was said by Oswald (1997, p. 1816) if the aim is to learn about what makes people tick, listening to what they say seems likely to be a natural first step. The domains-of-life literature states that life can be approached as a general construct of many specific domains, and that life satisfaction can be understood as a result from satisfaction in these domains of life (Cummins, 1996; van Praag et.al, 2003; Easterlin and Sawangfa, 2007; Rojas, 2006a, 2006b). It is evident that different domains may be distinguished. In many studies, the domains to be analyzed are determined by data availability. For instance, in the British Household Panel Survey leisure satisfaction is split up into two sub-dimensions; namely, the amount of leisure and use of the leisure time (Van Praag and Ferrer-i-Carbonell, 2007); the European Community Household Panel considers only satisfaction with leisure time , and the Latinobarà ³metro only includes satisfaction with the amount of leisure (Rojas, XXXX). Rojas (2007) affirms that the enumeration and demarcation of the domains of life are arbitrary. In addition to this, there are many possible partitions of a human life, and the selected partition depends on the researchs objectives and the available information. For example, Cummins (1996) has argued for a seven-domain partition: material well-being, health, productivity intimacy, safety, community and emotional well-being; van Praag et al. (2003) study the relationship of satisfaction in different domains of life (health, financial situation, job, housing, leisure and environment) and satisfaction with life as a whole. Rojas (2006b and 2007), on the basis of factor analysis, identified seven domains of life: health, economic, job, family, friendship, personal and community. Using information from Mexico , he showed that satisfaction in the family domain is crucial for life satisfaction. Family satisfaction includes aspects of satisfaction with ones spouse, children and with the rest of the family. Rojas also showed that the satisfaction in the health, job and personal domains is also very important for a persons happiness. Satisfaction in areas such as housing and living conditions, financial solvency and income are relatively less important for life satisfaction. Rojas (2007) found that income is an explanatory variable of relevancy for economic and labor satisfaction, but not for family satisfaction or leisure satisfaction. For that reason, it is possible to find situations where a person is satisfied with his/her life while he/she is unsatisfied economically, or where a person is unsatisfied wit h his/her life and, at the same time, his/her economic satisfaction is high (Rojas, 2008b). Empirical research has focused on different factors associated with subjective well-being and satisfaction. In agreement with psychological and sociological studies (Argyle, 1999), economic research has identified a set of personal and social characteristics associated with life satisfaction. Most studies using data from North America and European countries have found the level of reported life satisfaction to be high among those who are married (Blanchflower and Oswald, 2004b; Easterlin, 2003; Carroll, 2007; Clark et al., 2005; Ferrer-i-Carbonell and Frijters, 2004), women (Oswald, 1997; Clark, 1997), whites (Oswald, 1997; Alesina et al., 2004), the well-educated (Blanchflower and Oswald, 2004a; Frey and Stutzer, 2003; Borooah, 2005), the self-employed (Blanchflower, 2000; Blanchflower, 2004; Frey and Benz, 2003; Alesina et al., 2004), the retired (Di Tella et al., 2003), and those occupied with home duties (Di Tella et al., 2003; Borooah, 2005). The relation between an individuals age and happiness seems to be a bit more complex. Many people believe that the quality of life deteriorates with age and that old people should be unhappier than young people since the old tend to have a worse health, less income, and few are married. Nevertheless, many studies have surprisingly thought that old people report levels of happiness comparatively higher than young people, though this effect tends to be small. Frey and Stutzer (2001) have indicated four reasons that can explain this positive relationship between age and happiness: (i) the old have lower expectations and aspirations. For example, an elderly person waits to remain without work and possibly widower, so the effects of the loss will be lower on the old than on the young. (ii) They have little disparity between goals and achievements, since the eldelrlys goals are fixed closer to what reasonably they can reach. (iii) Older individuals have had more time to adjust to their life conditions, and (iv) old people have learned how to reduce the negative events of the life and how to regulate the negative affects. Besides, economists have identified a U-shape in the relationship between age and happiness (e.g. Oswald, 1997; Blanchflower and Oswald, 2004a). This implies a convex shape in the relationship of life satisfaction with age. Life satisfaction decreases with age until it reaches a minimum, increasing afterwards. For North America and European countries this minimum typically occurs in the forties (43 in Frey and Stutzer (2001) and Ferrer-i-Carbonell (2005); 46 in Peiro (2007)). Aspirations and comparisons effects also are important in relation with income and other factors affecting subjective well-being. The individuals reported subjective well-being in the present is based on a norm of what is `bad, `sufficient or `good. Such norms not only depend on the present situation, but also on what the individual has experienced in the past, on what he/she expects to experience in the future and on what other people think and do (van Praag and Ferrer-i-Carbonell, 2004). In relation with income, individual well-being does not only depend on income in absolute terms but also on the subjective perception of whether ones income is adequate to satisfy ones needs. In addition, individual income perception is subject to the individuals own situation, past and present, as well as to the income of other people. The latter reflects the importance of the relative position of individuals in society for their satisfaction with life. This is often referred to as the comparison income or relative utility effect. It is often argued that individuals adapt to new situations by changing their expectations (Easterlin, 2005; Clark et al., 2008). This implies that higher incomes are accompanied by rising expectations that lead to what is known as the hedonic treadmill (Brickman and Campbell, 1971) or hedonic adaptation (Frederick and Loewenstein, 1999). Thus, individuals strive for high incomes even if these lead only to a temporary or small increase in well-being. This ability to adapt would appear to be a ubiquitous feature of the human condition, some recent examples of adaptation in nonmonetary spheres are Lucas et al. (2003) and Lucas (2005) with respect to marriage and divorce, Wu (2001) and Oswald and Powdthavee (2006) for adaptation to illness or disability, and Lucas et al. (2004) regarding unemployment. The comparisons with different social reference groups are also an important factor that has been widely present in the analysis of two dimensions; namely, the analysis of the effect of relative income on financial satisfaction and/or satisfaction with life as a whole (McBride, 2001; Stutzer, 2004; Luttmer, 2005; Clark, Frijters and Shields, 2008) and the influence of unemployment on subjective well-being. A standard result in happiness literature is that the unemployed report significantly lower levels of subjective well-being than other labor force groups (Winkelman and Winkelman, 1998; Frey and Stutzer, 2002). Indeed, the pecuniary and the non-pecuniary costs of the unemployment are that high that adaptation is non-existent (Lucas et al., 2004) or only very moderate (Clark, 2002). Clark (2003) uses seven waves of the British Household Panel Survey to test for social norms in labor market status. In his analysis, he found that the well-being of the unemployed is the higher, the hig her the unemployment rate in a reference group (at the regional, partner, or household level). It seems that, the more unemployment becomes the norm, the less individuals are affected by it (Winkelman, 2006). Lalive and Stutzer (2004), using a different strategy, obtain the same results for information from Sweden. Social interactions could be either a negative or a positive factor. As previously mentioned, an individuals happiness depends on that individuals own relative (or positional) situation or status, and comparison with others, what would expose that individual to negative externalities in terms of peer-effects (Luttmer, 2005) in utility and/or consumption. Alpizar, Carlsson and Johansson-Stenman (2005) show that positionality matters far more for commodities as houses and cars than for vacation and insurance, but also that both absolute and relative consumption matter for each category, these are positional goods. The positive influence of social interactions may come from social relationships and other relational goods or social capital factors. For instance, Rojas (2007), Winkelman (2006), Argyle (1999), among other social scientists have found that social relationships are a major source of well-being. Although marriage is the relationship that has the most influence on happiness, there are other relationships that affect happiness, as well as health and mental health, by providing social support. Argyle (1999 p. 361) refers some studies where it was found that if all kinds of social support are combined, a social support factor is found to have a strong correlation of 0.50 with happiness. Social scientists in many countries have observed that social support or social networks (and the associated norms of reciprocity and trust (Helliwell and Putnam, 2004)) have powerful effects on the level and efficiency of production and well-being, broadly defined, and they have used the term social capital to refer to these effects (Coleman, 1988; Putnam, 2000; Woolcock and Narayan, 2000). Lately, some cross-sectional studies from both sociology and economics have shown the importance of key aspects of social capital such as trust, social contacts and membership in voluntary associations over individual well-being (Inglehart 1999; Putnam 2000; Helliwell 2003 and 2006b; Powdthavee, 2008). In Bowling Alone, Putnam (2000) suggested that people prosper in neighborhoods and societies where social capital is high, that is, where people trust one another and are mutually helpful. Putnam reviewed evidence showing that communities with high rates of volunteer activity, club membership, church membership, and social entertaining (all thought to be indirect manifestations of social capital) all had higher well-being than communities that were impoverish these characteristics. Many studies that use cross-sectional data have shown that individuals with rich networks of active social relationships, that do not include people living in the same household, tend to be happier with th eir lives (Phillips 1967; Burt 1987). Helliwell (2003) reported that well-being is high and suicide rates are low where trust in others is high, and he also found that well-being is high where memberships in organizations outside of work are at high levels. Thus, there is evidence that individuals are more likely to experience high well-being when they live in nations with high social capital than when they live in nations with low social capital, a finding that dovetails with the results of studies on individuals social interactions. Helliwell and Putnam (2004) and Powdthavee (2008) are comprehensive reviews about the importance of social capital factor over subjective well-being. Health status is a factor that can be expected to be an important determinant of life satisfaction. In the 1950s the use of concepts such as welfare, adjustment and mental health had much in common with the traditional concept about happiness (Argyle, 1991). Research on the health-related quality of life was developed in the mid 1970s by health scientists and psychologists in order to track peoples perception of their health status (Gough et al., 2007). This was mainly in response to the need for more sensitive measures to compare treatments for chronic illness and to identify the most cost-effective treatments . Good health is considered an important factor included in the capabilities and the necessary functionalities in order for an individual to face life (Deaton, 2007; Sen, 1999). Since the 1980s the state of health has been identified as an important determinant of life satisfaction, as happy people are healthier, both physically and mentally (Veenhoven, 1991; Argyle, 1999). Co nsequently, poor health, which limits an individuals ability to carry out their daily activities, reduces overall satisfaction. The literature about subjective well-being in Latin American countries is few and very recent. Graham and Pettinato (2001) were some of the first to analyze Latin American countries. Using the Latinobarà ³metro 2000, they found that Latin America is not all that different from the advanced industrial economies in relation to some of the determinants of happiness. Similar to the OECD countries, happiness has a quadratic relationship with age, initially decreasing and then increasing monotonically after 49 years of age. As in the industrial countries, being married had positive and significant effects. In contrast to the advanced economies, a significant gender effect was no found in Latin America. Also, as in the industrial countries, the coefficients for level of wealth were strong, positive, and significant in happiness. When wealth was included in the regressions, the coefficient for education level became insignificant or weakly significant, depending on the regression used. Bein g self-employed or unemployed both had significant and negative effects on happiness. When they included country-fixed effects, the coefficient on self-employment became insignificant. While being unemployed also has negative effects on happiness in the advanced industrial economies, being self-employed has positive effects. The most credible explanation is intuitive and it was given by the authors: most self-employed people in the latter are self-employed by choice, while in developing economies, many are self-employed due to the absence of more secure employment opportunities and live a precarious existence in the informal sector. Other analyses by countries have been conducted in Latin America. Among the most important, Rojas (2006b and 2007), using the domains-of-life approach in Mexico, found that people are on average, more satisfied in the family domain, while they are less satisfied in the consumption, personal and job domains. Rojas (2007) found that income is an explanatory variable of relevancy for the economic and labor satisfaction, but not for either family or leisure satisfaction. Due to that, he found a weak relationship between income and life satisfaction Gerstenbluth et al. (2007) studied the relationship between happiness and health in Argentina and Uruguay using the Latinobarà ³metro 2004. Cruz and Torres (2006), using the Encuesta de Calidad de Vida 2003, tested various happiness hypotheses among Colombians and Cid et al. (2008), using the survey called Salud, Bienestar y Envejecimiento en Amà ©rica Latina y el Caribe (SABE), explored the correlation between happiness and income in the el derly in Uruguay. To our knowledge, the previous studies conducted about Latin America have not included the effect of social capital on subjective well-being, and they have analyzed the self-employment as a homogeneous labor market status. However, when considering the specificity of the leisure domain, we should take into account that while satisfaction with other realms of life may lie upon the valuation of objective situations (such as one’s financial situation, health or housing conditions), satisfaction with leisure brings in an additional challenge as individual’s boundaries of leisure are defined by her perception of what is pleasant (Ateca-Amestoy et al., 2008). Conceptual discussion on the nature of leisure time in contemporary societies Time allocation decisions within the family: economic approaches and models. We will attach to the economic approach to human behavior by Becker (moreover, bring arguments such as those contained in a theory of social interactions). Temporal autonomy is a matter of having discretionary control over your time. Discretionary Time. A New Measure of Freedom (Goodin et al., 2005) Other approaches: we have found these relevant arguments: Veblens theory The omnivore Bourdieus distinction Putnams social capital 3.1. What is Social Capital? There is a traditional consensus that there exists three distincs traditions that conceptualize and analyze social capital. All three would be relevant for our reasoning. Pierre Bourdieu bourdieu2: who conceptualised social capital as the `actual or potential resources that an individual has at his/her disposal as a result of `a durable network of more or less institutionalised relationships of mutual acquaintance and recognition, i.e. membership in a group. Some authors point out that this definition must be viewed as part of his broader concern with developing the different types of capital in order to explain the means by which the social stratification system is preserved and the dominant class-reproduction strategy is legitimised. J.S. Coleman coleman defines it as the set of resources that inhere in family relations and in community social organisations and that are useful for the cognitive or social development of a child or young person. Social relations were viewed by Coleman to make up important `capital resources for individuals by means of processes such as setting `obligations, expectations and trustworthiness, creating channels for information, and setting norms backed by efficient sanctions. These resources may be influenced by factors such as generalised trustworthiness which ensures that obligations are met, the extent to which a person is in

Conservation of Races Essay

The United States of America, since its commencement, has been a â€Å"melting pot† of different nationalities. While the term melting pot sounds forthcoming, this is not the case in reality. Many times cultures collide due their differences in ideology, culture, and geographical proximity. Such culture clashes have marked the history of the United States. Race is usually thought of in the physical sense with difference in skin color, hair, facial features, and language. Although race usually follows along physical lines, it is much more far reaching and extends into the social and cultural beliefs. In the past, the dominant trend was to keep these beliefs separate, consequently increasing the feeling of racial unity and racism in society. History has shown us that man has used segregation as a method of not only keeping the peace, but also of keeping the purity of a race in tact. In 1897, an address to the Negro Academy entitled â€Å"The Conservation of Races,† W. E. B. Dubois states: â€Å"The question, then which we must seriously consider is this: What is the real meaning of Race; what has, in the past, been the law of race development, and what lessons has the past history of race development to teach the rising Negro people? I thought the caliber of Dubois’ intelligence and boldness to ask the question was compelling. Throughout this essay I will explore and illustrate how Dubois comes to answer the questions, which he asked his audience. I found it easier to dissect the complex question into three separate questions. First I will illustrate how Dubois defines race. Then I will pinpoint where the basis of the law of race development is formulated. Finally, he answers the question; what can lessons of past history of race development teach the rising Negro? W. E. B Dubois writes that he believes that the conservation of races is the cornerstone of keeping the Negro race pure and intact. Thus, for him, race preservation is not backed only with racial motives, but to help society better itself as a whole. The history of the world is outlined by the histories’ of different groups and races. He states, â€Å"If it be true the history of the world is the history, not of individuals, but of groups, not of nations, but of races, and he who ignores or seeks to override the race idea in human history ignores and overrides the central thought of history (pg.142). In â€Å"The Conservation of Races† Dubois stresses the importance of surveying the whole question of race. He criticizes a biological account of race. He claims that such an account is inadequate because it fails to explain both the wide variety of physical traits within a race and the physical likenesses shared by all humans. For example he states, â€Å"Many criteria of race differences have in the past been proposed, as color, hair, cranial measurements and language. And manifestly in each of these respects differ widely (pg 142)†. Instead, Du Bois proposes a definition of race based on sociohistorical criteria that emphasized cultural and political loyalty. He defines race as: a vast family of human beings, generally of common blood and language, always of common history, traditions and impulses, who are both voluntarily and involuntarily striving together for the accomplishment of certain more or less vividly conceived ideals of life (pg. 142). I would have to agree with Dubois that race is a combination of language, traditions, color, impulses, common blood and ideals of life. This is extremely evident in the anatomy of the world. You can have people who are physically, spiritually, politically, socially, etc. very different be members of the same race. â€Å"Although the wonderful developments of human history teach that the grosser physical differences of color, hair and bone go but a short way towards explaining the different roles which groups of men has played in Human Progress, yet there are differences- subtle, delicate, and elusive, though they may be – which have silently but definitely separated men into groups† (pg 142). Here Du Bois suggest an ideal of the law of race development. He further adds, â€Å"At all times, however, they have divided human beings into races, which, while they perhaps transcend scientific definition nerveless, are clearly defined to the eye of the Historian and Sociologist† (pg. 142). I think and maybe Du Bois would agree that the idea of race is an outdated, invalid scientific concept used to categorize individuals and validate who is superior or inferior. As discussed in class I don‘t think racism will ever cease to exist, because the ideal of race is far too prevalent from individuals of all sizes, shapes, and colors. And focusing on the illusion of race will never solve the problem of racism. The only way to stop racism is to end the classification of individuals based on meaningless physical characteristics as a whole and celebrate diversity. Finally, he answers the third part to his complex what can the lessons of past laws of racial development teach rising Negro people. By answering this question he attempts to motivate African Americans to create a recognizable culture and make a difference in the world. He believed that African Americans had potential. He thought that in order eliminate the problems African Americans were facing the focus must first be on boosting the African American culture. He states, â€Å"As such, it is our duty to conserve our physical powers, our intellectual endowments, our spiritual ideals; as a race we must strive by race organization, by race solidarity, by race unity to the realization of the broader humanity which freely recognizes differences in men, but sternly deprecates inequality in their opportunities of development† (pg. 145). Dubois also saw the need for one main intellectual entity, a Negro Academy. Dubois eloquently stated, â€Å"†¦ for all these products of the Negro mind, which we may call a Negro Academy. Not only is all this necessary for positive advancements, it is absolutely imperative for negative defense† (pg. 145). He also notes that the African race has not yet been able to share its message. He sates, â€Å"For the development of Negro genius, of Negro literature and art, of Negro spirit †¦ Negroes inspired by the vast ideal, can work out in its fullness the great message of humanity† (pg. 144). In closing, races embody within themselves the answers modern society’s problems. However, a better description of the status of the Negro message would be a work in progress.