Archive for March, 2015

Social Problems: A Five Decade Review

March 31, 2015

Social Problems: A Five Decade Review

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Institution

Social Problems: A Five Decade Review

As identified in previous readings, social problems are undesirable situations across the country and even the globe. Despite being a developed nation, the USA has had a protracted war with poverty. In 1964, President Lyndon B. Johnson declared “war on Poverty”. In his strategy to fight poverty, he targeted an improvement in education, increase in access to quality healthcare, access to economic resources for the poor in order to make ends meet, and increase in the number of jobs. Fifty years down the line, America has made visible steps towards ensuring that it completely eradicates poverty from its borders and ensure that people can be self-dependent. This paper analysis the state of poverty in the USA for the last fifty years and efforts that have been made to eradicate it. Using a major theoretical framework, the paper seeks to create deeper understanding of the problem and its impacts on the future of the society and finally suggesting how the situation can be remedied.

The percentage of the population in poverty in USA has reduced from 1968 to 2012. However, despite this, there is still a lot that will need to be done before the country completely gets rid of poverty. In .2012, approximately 49.7 million Americans were living below the poverty line. This included 13.4 million children. While USA is considered to be an economic power house, only 50% of the country’s lover income earners are able to make it out of this bracket over a period of 20 years. Further, the issue of poverty seems to be deep rooted. About 40% of the differences in the income of parents today is reflected in the children’s income in future. This shows the strong and lingering impacts that result from growing up in poverty. The battle with poverty in the USA has not been fought without the help of NGOs. Instead, for the last fifty years, the fight has been through a mutual understanding between the government and NGOs. A program that is designed to increase the level of economic security was used to lift over 45 million Americans from poverty in 2012 alone (So, 2014). Between 1968 and 2012, the program had lifted an average pf 27million people from poverty which culminates to avoiding approximately 1.2 billion “person years” of poverty during this period. Within this period, social security has also contributed a lot in ensuring that the elderly do not fall into poverty. In 2012, social security reduced the poverty rate by 8.5% among all individuals while it reduced the same by 39.9% among the people above the age of 65%. The unemployment Insurance (UI) reduced poverty by 0.8% (The Council of Economic Advisors, 2014). The change in employment status is significant to the country’s fight against poverty as unemployment is one of the main predictors of poverty. The rates of poverty have also fallen across all races and ethnic group and the gaps by race have slightly shrunk from those in the previously years. However, there are still major gaps that need to be speedily addressed. In 1995, approximately 60% of the African Americans were living in poverty compared to only 20% of the whites. Currently, the poverty rate for African Americans stands at 27.8%. However, this is still twice the rate for whites. This shows that the problem of poverty is not isolated from other social problems such as racism.

Sociologists have come up with different theories to approach the issue of poverty. One of the theories that they have relied on is the theory of social conflict. According to this theory, since there is an enormous amount of wealth in the modern societies, there is no reason why some parts of the population should live without access to t=essential amenities and meeting basic needs. According to conflict theorists, this situation only exists because the people in power want it to exist. They assert that the working poor are paid very low wages while their employers make huge profits from their work. For the unemployed, the social theorists view them as victims of this power structure. The wealthy impose great opposition on programs that can be used on eradicating unemployment such as job training and education because they do not want to support these projects through paying extra taxes. To escape blame, the wealthy people try to blame individualism as the main cause of poverty and state that it results from the poor failing to put in enough effort. They instead ignore the social injustices and circumstances that are beyond the control of individuals. Following this, the wealthy engage in charitable activities in the bid to help the poor. While the world applauds these efforts, social conflict theorists observe this as a way of the government and other wealthy people to perpetuate economic inequality and poverty (Ikejiaku, 2012). This is because welfares and the charities only serve to quell the social unrest that would otherwise threaten the status quo. By carefully analyzing the actions of the government and the wealthy, one realizes that the welfares and charities are a way of entrenching them and legitimizing their positions. When the poor are given handouts, all they do is that they learn to become dependent rather than independent. They also acknowledge that the rich and the government are at a higher economic status than they are. Due to these seemingly “acts of good faith”, the poor do not get the opportunity to sit and review the numerous injustices that they have suffered for them to remain in their position of poverty. Instead, they only think of thanking the government and other charities for providing a single day’s meal (Bobo & Fox, 2003). Further, social conflict theorists state that after a while, the poor accept the judgment that the rest of the people pass on them and they adjust to this life and actually portray signs of lack of ambition to come out of this class. The conflict theorists do not view poverty as being essential or functional in any way (Zastrow & Kirst-Ashman, 2009). Instead, they view it as a situation that arises because some people are eager to benefit from the poverty of other people. Poverty eventually becomes a problem if some people feel that the manner in which resources are distributed is unjust and that the situation should be remedied.

Social conflict theorists believe that the only way of resolving the current poverty crisis is through a political system that agrees to empower the poor. Any programs that are laid out without the agreement of the political class are doomed to fail. However, this is not likely to happen because the political class would like to remain in power. Therefore, the solution must come from the poor. The poor should become organized in political groups that can agitate for their rights (Kneebone & Berube, 2014). Currently, poverty is a social problem that has resulted in people from different corners expressing concerns. As a result, a social problem must be solved through a movement that closely engages the society. Therefore, it is only through political enlightenment that the poor can come out of the current situation. Since there are available resources for everyone, the only problem is the distribution. Therefore, the group that holds the powers of distribution determines the people likely to live in poverty. If the poor become politically enlightened, they will have the ability to champion for their rights and for a better system of distribution of resources (Kotler & Lee, 2009). Despite some theorists arguing that some of the people are poor because they do not work hard, with a weak foundation guiding policy making, it becomes very difficult for the people to come out of poverty. Therefore, an enlightened poor class is required to seize the opportunity and become politically enlightened so that it can demand for equal rights and creation of a system that is void of favoritism of the rich.

In conclusion, the paper shows the steps that the USA has made in tackling poverty. However, research shows that poverty still exists in the country. Borrowing from the social theorists shows that the reason for this poverty still existing is because there are classes that benefit from the poverty of other people. Therefore, until the poor are politically enlightened, the situation is likely to persist for a long time. As such, the paper shows that the solution for poverty lies in creating a high level of political awareness among the people.

References

Bobo, L., & Fox, C. (2003). Race, Racism, and Discrimination: Bridging Problems, Methods, and Theory in Social. Social Psychology Quarterly,Vol 66 No 14, 319-332.

Ikejiaku, B.-V. (2012). Poverty-Conflict Nexus: The Contentious Issue Revisited. European Journal of Sustainable Development 1(2), 127-150.

Kneebone, E., & Berube, A. (2014). Confronting Suburban Poverty in America. New York: Brookings Institution Press.

Kotler, P., & Lee, N. (2009). Up and Out of Poverty: The Social Marketing Solution. New York: Pearson Prentice Hall.

So, G. (2014). From “Pockets of Poverty” to Potential Prosperity in Appalachia: Examining Mass Media Narratives of Poverty Stereotypes in Appalachia. The Elon Journal of Undergraduate Research in Communications, Vol. 5, No. 2, 71-98.

The Council of Economic Advisors. (2014). The War on Poverty 50 Years Later: A Progress Report. The Council of Economic Advisers, 1-53.

Zastrow, C., & Kirst-Ashman, K. K. (2009). Understanding human behavior and the social environment. Chicago: Nelson-Hall Publishers

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Cultural Reaction paper

March 29, 2015

Cultural Reaction paper

Course Code

Student name

Learning Institution

Date

Introduction

Cultural awareness is an important aspect of any community. It includes the ability to respect and appreciate the cultural values, perceptions and beliefs of a community. It is a necessity where people have to interact with other cultures. What one culture considers as inappropriate differs from the view of another culture. As such, a social worker must be aware of this differences to be able to effectively impact the community. Cultural reaction refers to the response that a culture receives from those that are not part of it. This can range from people feeling that:

  • The culture is superior to theirs
  • The culture is inferior to theirs
  • The culture can be assimilated into the existing culture in the community

(Quappe & Cantatore, 2005)

Fayetteville is a town that is largely known for the military community that it has. Medical Social Workers are considered to be important members of the community at Fayetteville. Their core role involves interviewing clients and their families. It also entails coordinating and planning programs or activities that meet the social and emotional needs of the clients and their families. The cultural system in focus is the Hawaiian community in Fayetteville. The estimated population of the Native Hawaiian community is at less than 0.5% (United States Census Bureau, 2015). According to a census report, out if the twelve thousand, nine hundred and forty two businesses registered in the town as at 2007, less than 25 businesses are owned by the native Hawaiian and Pacific Islander population (United States Census Bureau, 2015).

This paper attempts to understand the culture of Hawaiian natives. This will be achieved through conducting interviews among Hawaiian natives in Fayetteville. The data collected will be analyzed against research on cultural identity, the cultural norms of the Hawaiian peple, world view, religious practices, common child reasing practices, accultration, sociopolitical histories as well as the culture-specific delivery process. The findings will influence the cultural awareness that social wokers have of the native Hawaiian population in Fayetteville, North Carolina.

Personal Assumptions and Biases

Mention the word Hawaii and the first impression that comes to mind is great food and a beautiful island that is considered as one of the most beautiful vacation spots in the Pacific. The people are friendly and seem to never be in a hurry. People are in no hurry. The general perception is that Hawaiian natives are predominantly colored. The Hula dance is a practice that many are familiar with and associate with hawaiian culture. The impression is that Hawaii is a place whose culture is founded on enjoying life and basically having a good time.

Accultration of Hawaiian culturein Feyetteville is not significant considering that the population of native Hawaiians in the community is negligible. This made it difficult to conduct interviewsaasit entailed a lot of research on loccating parts of the communitythat had majority of the native hawaiian population. This made it a challenge to collate the information. In addition, many of the Native hawaiian population have assimilated into american culture. The children especially know very little of their native culture.

Cultural Identity and Norms

From research collected through interviews among the native Hawaiian community, one thing that came across very strongly was the importance of family among the native Hawaiian community. The community has put together social gatherings thatallow them to celebrate their culture in north Carolina. The Ka Pu’uwai ‘O Hawai’i (also known as the Hawai’i club of North Carolina) is a private club whose core mission is to encourage an ‘Ohana (family) within the community so as perpetuate Hawaiian culture (The Hawai’i Club of NC, 2015). The club is made up of families that are either Hawaiian natives or they lived on thee island for a long time and as a result fell in love with the culture and thee people. They organize a number of activities each year for networking and celebrating Hawaiian culture. The potluck tradition is founded on a common hawaiian culture where a person is expected to carry a gift in the form of food when visiting a home. According to hawaiian culture, it is common for guests to take off their shoes at the main door. It iscommon courtesy to gift someone with food and also when one is living, it is considdered good manners to carryleft overswith you as you leave.

A common custom in weddings is the pandango. This is otherwise known as the money dance. The newlyweds perfoem a solo dance while the guests bestow monetary gifts upon them (Schachter, 2013).

World view

Hawaii is widely known as a tourist hot spot. The economy is largely dependent on the tourism sector (Schachter, 2013). Hawaiian natives in Fayetteville are associated with potluck events. Their food is one of the unique elements of their culture. As such, many parts of the world now offer Hawaiian cuisine. Hawaii is considered as one of the most beautiful vacation spots in the Pacific. The people are friendly and seem to never be in a hurry. People are in no hurry. The general perception is that Hawaiian natives are predominantly colored. The Hula dance is a practice that many are familiar with and associate with hawaiian culture. The impression is that Hawaii is a place whose culture is founded on enjoying life and basically having a good time. The people are friendly and focus on togetherness. As such, they focus a great deal on the perpetuation of their culture.

Religious Practices

The traditional religious practice of nativve Hawaiians were based on religion that was polytheistic and animalistic. They had a number of gods and spirits thatthey worshipped. The chiefs were considered as deity as well. Howewever, this religion was later replaceed by chrisitianity. While a number of ceremonies practiced till today are nborrowed from Hawaiian religion, much of their practices are no longer practiced. The American Indian Religious freedom Act protects hawaiian religious practices (Schachter, 2013).

Child Rearing Practice

A common practice that Native Hawaiians family is ‘Ohana (family). It is an essential element of the community and has a significant role in the raising of children. NativeHawaiians aregreatly influenced by the strong connection they have with family (DeBaryshe, Yuen, Nakamura, & Stern, 2006). This is largely because they live in multigenerational households. As such, they are in direct contact with grandparents and thee restof the extended family. The result is children tend to have better emotional support and are closely related to their family mebers. Such children are also familiar with Hawaiian cultural practices . This is done through nteraction with family members from different generations who passon what they know to the younger generation (DeBaryshe, Yuen, Nakamura, & Stern, 2006).

Based on information provided y cultural historians, native hawaiian child rearing practies are centered on being affectionate and undulgent towards infants. Native Hawaiian parents may engage in teaching that is not very detailed and depend on indirect methods to mould the child’s behavior.native Hawaiian parents prefer to not use praise as well as material rewards as they fear establishing a culture of dependence on external incentives in their children (DeBaryshe, Yuen, Nakamura, & Stern, 2006).

Native Hawaiian parents tend offer their children high levels of support.The result is such children tend to have a healthy self image and are less prone to depreession especially if the child is from a poor economic background.

Sociopolitical histories, accultration and culture-specific delivery process

Hawaiian society has evolved over the years too what it is today. The highest authority in the community wa sthe king followedby the high chief (ali’i). The king’s powers including controlling taxes, overseeing certain religious rituals and the leader in times of war. The king was surrounded by a team of advisors. The most superior of these advisors were the chief minister and the high priest who gained audience with the king on many occasions. They were regarded as the king’s chief advisors in matters of state, war and cultural practices.

Below the chief advisors were the ali’i (chiefs of all ranks). Their position was subject to the king’s discretion as well as their family tree. As such, there was a hierarchy within this rank as well. Those of lesser rank came ffrom a famiy where the father was a man favored by the chief that had married a woman of ali’I lineage (Schachter, 2013). Those aAli’i that had the title conferred on them by the king held the lowest rank as this title was not a birth rite. The king conferred this right to a man based on his strength or a sppecial skill that he possessed. However, such an Ali’i could not pass this title to his children.

The chiefs and the king had many attendants. Those that were regarded as commoners were expected to kneel as a sign of honor and respect to the ali’i and the king (mo’i). A commoner was expected to kneel in the presence of a chief who was having a meal (Quappe & Cantatore, 2005). On the face of it,it appears quite oppressivefor the commoners who had no significant status. Many commoners performed the role of workers thatwere skilled in particular areas such as farming, construction etc. The lowest rank in society was the kauwa (outcasts). This title was a birth rite passed down through generations.

According to the Merriam-Webster dictionary, acculturation refers to the cultural modification of people by either borrowing traits from another culture of the merging of cultures as a result of interacting for a long period of time. The assimilation of the values of another group can manifest in the form of memberships in common social groups and institutions. An example of this is the NC club for Hawaiian families seeking to keep in touch. These families consist of native Hawaiians as well as American families that have lived in Hawaii for a long time and fell in love with the place, its people and culture. Such interaction not only perpetuates certain Hawaiian cultural norms such as potluck but also result in this culture being influenced by that of American families. Institutions are a huge determinant of the ability to perpetuate certain cultures and norms. According to native Hawaiian culture, children are expected to receive guidance and instruction from the older members of the family. This conflicts with the US education system which is based on instilling a sense of independent thinking in the child. The result is native Hawaiian children are acculturated into a mix of customs giving rise to a number of internal and external conflicts. It becomes difficult for them to assert their own identity especially when they attain adolescence (Schachter, 2013).

Conclusion

Native Hawaiian culture is rich in customs, beliefs and practices. While certain elements of culture norms and practices are no longer practices, the core values of family (‘Ohana) and togetherness continue to be perpetuated by the community not only in Hawaii but also in different part of the United States where there is a settlement of Hawaiians.

References

DeBaryshe, B. D., Yuen, S., Nakamura, L. N., & Stern, I. R. (2006). The Roles of Family Obligation and Parenting Practices in Explaining the Well-Being of Native-Hawaiian Adolescents Living in Poverty. Hulili: Multidisciplinary Research on Hawaiian Well Being Vol. 3, 103-126.

Quappe, S., & Cantatore, G. (2005). What is Cultural Awareness, anyway? How do I build it? Retrieved from Culturosity: http://www.culturosity.com/pdfs/What%20is%20Cultural%20Awareness.pdf

Schachter, J. (2013). The Legacies of a Hawaiian Generation: From Territorial Subject to American Citizen. Berghahn Books.

The Hawai’i Club of NC. (2015). ALOHA! WELCOME TO KA PU’UWAI ‘O HAWAI’I – THE HAWAI’I CLUB OF NORTH CAROLINA. Retrieved from hawaiiclubnc: http://www.hawaiiclubnc.org/

United States Census Bureau. (2015, February 5). Fayetteville (city), North Carolina. Retrieved from census.gov: http://quickfacts.census.gov/qfd/states/37/3722920.html

Conclusions of an Integrative Research Review.

March 28, 2015

PHARMACOGENOMICS IN THE NURSING LITERATURE

Name:

Course:

Instructor:

Institution:

Date of Submission:

Synopsis

In the research 50 people were screened to obtain the duplicates. A summery was reviewed to ensure that those who did not meet the inclusion criteria were eliminated and left out. Data about them was were extracted and they were verified by authors to check on the discrepancies if they exited. Data was the organized and analyzed for various reasons.

The purpose of the study was to review and solve the problem of inadequacy of knowledge among the clinical officers and medics who have specialized in pharmacogenomics and the pharmacokinetics. During the study, three attributes came out from the pharmacogenomics and pharmacokinetics and they included the following definition of various problem faced by nurses and medics; science study, genomic, generic and pharmacology

During the study the 136 articles were identified the prospects of the title that were identified in the study was to eliminate the titles that were duplicated. The summary of 180 reports were reviewed to check on the unnecessary articles which did not meet the inclusion criteria.

The data that was abstracted from various articles were used to determine that the study was included in the analysis. The information about the authors, their nationality, article type, their objectives and purposes also indicated that the study was included in the articles. Also the discussion involving the nursing implications were wer4e arranged in three various groups.

The study about the scientific contribution, baseline comprehension of knowledge discovery about pharmacogenomics was reviewed in the study. Here the integrative review was carried out to through intensive examination of the state of science of inheritance and variation .the concept of pharmacogenetic, clinical practices and nurses responsibilities among others were some of the studies that were reviewed.

During research the following reserve tools were employed to ensure efficiency in data collection and interpretation. Narrative reviews were used to deal with variations in responses to medical behavior due to variation in a single gene. Narrative review also provided an overview of an individual medication, the importance of advanced nursing activities and the resources related to personalized medication. Data was analyzed and presented in tables and charts.

The purpose of the study was to review the clinical and medication aspects of the pharmacogenomics and the pharmacokinetics. During the study various implications were discussed and with and all the stakeholders came to an agreement that the nurses required to have the capability of applying pharmacogenomics know how in practicing nursing assessment and more elaborate and detailed family and patient stories(Beery & Hern 2004).. Moreover the study also noted that the necessity for the nurses to have a painstaking ability to judge to judge the effectiveness of pharmacogenomics .Finally the study also revealed that education should entail ethical and legal procedures regarding genomic medication because the nurses and medical practitioners would be held liable and professionally responsible for understanding pharmacogenomics of drugs administration.

Credibility

The topic was not clearly defined. The literature review resulted in a sample that was homogeneous from the sample articles. No narrative review was included in describing the systematic of evaluating such methods, strategies employed, articles retrieved, and the reasons for final sample selection. The results of pharmacokinetic and pharmacogomics about the variations in the conceptual definitions .pharmacogenomics was explained in the article to have a percentage of 21% while the pharmacokinetic was defined by 25.5%.

The search for the studies and the evidence was not comprehensive. The article also provided level three evidence by representing an in vitro pharmacogenetric research. Whereas all the journals and the articles the minimum level of evidence, narrative and opinion manuscript or level VII. They include topics were not assessed for quality as most of the implications were generated in the context of future in several articles, pharmacogenomics and pharmacokinetic were viewed far off in now and here clinics rather than education or research. The design characteristics and the findings of the study were not displayed sufficiently as Thorough research should be conducted aiming to support the nursing implications that occur during the practice.

The conclusions are not credible as they lack empirical studies and theory has greatly thwarted the establishment of a robust foundation to build upon. It should be mandatory for nurses to engage in inter disciplinary conversations that involve pharmacogenomics so as to meet the expected practice responsibilities.

Clinical significance

Across the studies the strength of association was not found to make the difference in the patient outcomes. The review resulted into a homogenous article samples with the majority of them being narrative samples. According to Moher, there was no narrative article reviews that contained a description of evaluating the system methods such as the number of the retrieved articles, the reason for the final sample selection and the search strategies that were used in the process (Beery & Hern 2004). The intended purpose of the articles was to review the clinical aspects of pharmacogenetics. However around 40 % of the articles were not well prepared for the defined purpose. For example in one of the articles the purpose of the statement was absent within the text of the article.

The conclusions given are not relevant to the care of the nurses During the study various implications were discussed and with and all the stakeholders came to an agreement that the nurses required to have the capability of applying pharmacogenomics know how in practicing nursing assessment and more elaborate and detailed family and patient stories. During the study various implications were discussed and with and all the stakeholders came to an agreement that the nurses required to have the capability of applying pharmacogenomics know how in practicing nursing assessment and more elaborate and detailed family and patient stories.

Conclusion

Pharmacogenomics is vital in prescription of individual drug therapy by choosing the right drugs to be administered the patients. Through the integrative review limitations identified a need to embrace and recognize the importance of burgeoning field. The field of Pharmageconomics should be keenly monitored as it has been implemented in various capacities. Thorough research should be conducted aiming to support the nursing implications that occur during the practice.

Lack of empirical studies and theory has greatly thwarted the establishment of a robust foundation to build upon. It should be mandatory for nurses to engage in inter disciplinary conversations that involve pharmacogenomics so as to meet the expected practice responsibilities. The present literature is limited in terms of the scope, number and the type of articles to be used.

References

Beery, T. A., & Hern, M. J. (2004). Genetic practice, education, and research: An overview for advanced practice nurses. Clinical Nurse Specialists, 18(3), 126e132.

Conclusions of an Integrative Research Review.

March 28, 2015

PHARMACOGENOMICS IN THE NURSING LITERATURE

Name:

Course:

Instructor:

Institution:

Date of Submission:

Synopsis

In the research 50 people were screened to obtain the duplicates. A summery was reviewed to ensure that those who did not meet the inclusion criteria were eliminated and left out. Data about them was were extracted and they were verified by authors to check on the discrepancies if they exited. Data was the organized and analyzed for various reasons.

The purpose of the study was to review and solve the problem of inadequacy of knowledge among the clinical officers and medics who have specialized in pharmacogenomics and the pharmacokinetics. During the study, three attributes came out from the pharmacogenomics and pharmacokinetics and they included the following definition of various problem faced by nurses and medics; science study, genomic, generic and pharmacology

During the study the 136 articles were identified the prospects of the title that were identified in the study was to eliminate the titles that were duplicated. The summary of 180 reports were reviewed to check on the unnecessary articles which did not meet the inclusion criteria.

The data that was abstracted from various articles were used to determine that the study was included in the analysis. The information about the authors, their nationality, article type, their objectives and purposes also indicated that the study was included in the articles. Also the discussion involving the nursing implications were wer4e arranged in three various groups.

The study about the scientific contribution, baseline comprehension of knowledge discovery about pharmacogenomics was reviewed in the study. Here the integrative review was carried out to through intensive examination of the state of science of inheritance and variation .the concept of pharmacogenetic, clinical practices and nurses responsibilities among others were some of the studies that were reviewed.

During research the following reserve tools were employed to ensure efficiency in data collection and interpretation. Narrative reviews were used to deal with variations in responses to medical behavior due to variation in a single gene. Narrative review also provided an overview of an individual medication, the importance of advanced nursing activities and the resources related to personalized medication. Data was analyzed and presented in tables and charts.

The purpose of the study was to review the clinical and medication aspects of the pharmacogenomics and the pharmacokinetics. During the study various implications were discussed and with and all the stakeholders came to an agreement that the nurses required to have the capability of applying pharmacogenomics know how in practicing nursing assessment and more elaborate and detailed family and patient stories(Beery & Hern 2004).. Moreover the study also noted that the necessity for the nurses to have a painstaking ability to judge to judge the effectiveness of pharmacogenomics .Finally the study also revealed that education should entail ethical and legal procedures regarding genomic medication because the nurses and medical practitioners would be held liable and professionally responsible for understanding pharmacogenomics of drugs administration.

Credibility

The topic was not clearly defined. The literature review resulted in a sample that was homogeneous from the sample articles. No narrative review was included in describing the systematic of evaluating such methods, strategies employed, articles retrieved, and the reasons for final sample selection. The results of pharmacokinetic and pharmacogomics about the variations in the conceptual definitions .pharmacogenomics was explained in the article to have a percentage of 21% while the pharmacokinetic was defined by 25.5%.

The search for the studies and the evidence was not comprehensive. The article also provided level three evidence by representing an in vitro pharmacogenetric research. Whereas all the journals and the articles the minimum level of evidence, narrative and opinion manuscript or level VII. They include topics were not assessed for quality as most of the implications were generated in the context of future in several articles, pharmacogenomics and pharmacokinetic were viewed far off in now and here clinics rather than education or research. The design characteristics and the findings of the study were not displayed sufficiently as Thorough research should be conducted aiming to support the nursing implications that occur during the practice.

The conclusions are not credible as they lack empirical studies and theory has greatly thwarted the establishment of a robust foundation to build upon. It should be mandatory for nurses to engage in inter disciplinary conversations that involve pharmacogenomics so as to meet the expected practice responsibilities.

Clinical significance

Across the studies the strength of association was not found to make the difference in the patient outcomes. The review resulted into a homogenous article samples with the majority of them being narrative samples. According to Moher, there was no narrative article reviews that contained a description of evaluating the system methods such as the number of the retrieved articles, the reason for the final sample selection and the search strategies that were used in the process (Beery & Hern 2004). The intended purpose of the articles was to review the clinical aspects of pharmacogenetics. However around 40 % of the articles were not well prepared for the defined purpose. For example in one of the articles the purpose of the statement was absent within the text of the article.

The conclusions given are not relevant to the care of the nurses During the study various implications were discussed and with and all the stakeholders came to an agreement that the nurses required to have the capability of applying pharmacogenomics know how in practicing nursing assessment and more elaborate and detailed family and patient stories. During the study various implications were discussed and with and all the stakeholders came to an agreement that the nurses required to have the capability of applying pharmacogenomics know how in practicing nursing assessment and more elaborate and detailed family and patient stories.

Conclusion

Pharmacogenomics is vital in prescription of individual drug therapy by choosing the right drugs to be administered the patients. Through the integrative review limitations identified a need to embrace and recognize the importance of burgeoning field. The field of Pharmageconomics should be keenly monitored as it has been implemented in various capacities. Thorough research should be conducted aiming to support the nursing implications that occur during the practice.

Lack of empirical studies and theory has greatly thwarted the establishment of a robust foundation to build upon. It should be mandatory for nurses to engage in inter disciplinary conversations that involve pharmacogenomics so as to meet the expected practice responsibilities. The present literature is limited in terms of the scope, number and the type of articles to be used.

References

Beery, T. A., & Hern, M. J. (2004). Genetic practice, education, and research: An overview for advanced practice nurses. Clinical Nurse Specialists, 18(3), 126e132.

Strategic Management Oil and Gas

March 27, 2015

Contents Page
Introduction…………………………………………………………………….3

Drivers for the Joint venture……………………………………………………4

Benefits of the joint venture……………………………………………………6

Potential issues with the joint venture…………………………………………8

Recommendations……………………………….……………………………..9

Conclusions……………………………………………………………………11

References……………………………………….……………………………12
Introduction

Joint ventures have become increasingly common in the energy sector where companies come together with the aim of combining resources in order to succeed in undertaking projects. This has come about as a result of the high costs and risks that are involved with undertaking projects in the energy sector. Through joint ventures, partners have a high chance of succeeding in undertaking the big energy projects as opposed to each of the companies undertaking the project on its own. This is because the two companies are able to share the costs that are incurred in the project as well as coming up with an effective strategy to oversee the project by working with personnel and managers who have varying background and extensive experience. This paper explores the joint venture between Pakistan Petroleum Limited (PPL) and Orion Energy which was aimed at exploration and investment towards drilling of power which would be receiving gas from the Kandhkot gas field. The agreement was signed by the MD and CEO of PPL Asim Murtaza Khan and CEO and Director Orion Energy David M. Thomas on June 28, 2013.

This joint venture has been chosen as it involved two well established companies in the energy industry with different backgrounds. Orion Energy is based in UK while Pakistan Petroleum Ltd is based in Pakistan. The two companies have varying strengths which made them well placed to contribute significantly in the venture. The joint venture was also significant from the fact that it demonstrated the interest of UK based companies for offshore exploration where the venture welcomed and approved by the British government. PPL on the other hand has a strategic advantage given the fact that it is based in Pakistan where the project was being undertaken. The fact that the two companies have a different background will help to identify some of the benefits that come about from the venture as well as the challenges that are likely to be experienced. The venture will also help to identify some of the key factors that make such ventures successful and how the managers can be able to overcome the challenges that they experience (Edwards, 2010).

Drivers for the Joint venture

There were various drivers that led to the joint venture between Pakistan Petroleum Limited (PPL) and Orion Energy. The key driver for the joint venture can be said to have been the desired to invest in an income generating project which would offer return for both companies. Joint ventures are aimed at a common goal of earning maximization as the shareholders in both companies want nothing less than returns on the capital that they have invested in the company. The fact that undertaking a project on its own could be a too complex and risky affair for a single companies lead them to forming joint ventures. This has been the case with Pakistan Petroleum Limited (PPL) and Orion Energy where the two companies have identified an opportunity that they can take advantage of in order to maximize their returns. In order to reduce the risks involved and increase the chances of success, the two companies have formed a joint venture in order to carry out the project together (Choo, 2002).

The need for technical expertise was also a key driver for the joint venture where Pakistan Petroleum Limited (PPL) needed the technical assistance of Orion Energy to undertake the project. The Pakistan market is not as established as Britain which means that Orion Company has an added advantage in terms of technical expertise for its staff. The company also has had extensive experience in undertaking other similar projects in different parts of the world and Pakistan Petroleum Limited (PPL) needed this kind of technical expertise in order to undertake the project and this led to the joint venture. Orion Energy key driver in engaging in the joint venture was to take advantage of the opportunities arising in the offshore market (Craig, 2003).

This has been a trend with most of the western energy companies which get into ventures with companies in foreign markets where there are opportunities for investment. This is as a result of the limited market and opportunities in their local markets which force them to seek opportunities elsewhere. The venture between Pakistan Petroleum Limited (PPL) and Orion Energy for instance was aimed at exploration and establishment of a power plant in Pakistan which would enable the two companies operate supply energy to Pakistan. There are limited opportunities within Britain and with the high competition in the market the company has sought for opportunities elsewhere (Jones, 2012).

The fact that the project was costly to be undertaken by one company was a driver as it would require a high capital outlay. The Pakistan Petroleum Company PPL as such was not in a position to undertake the project on its own as a result of limited financial capability. Undertaking the project jointly would therefore minimize the capital invested by each of the companies. It is for this reason that the company opted to get to a joint venture with Orion Energy an established company in UK which will help to provide additional capital in order to undertake the project (Bern, 2011).

Benefits of the joint venture

There are various advantages that are likely to come about from the joint venture as outlined below;

  1. Reduced cost of investment

One of the key benefits that come up with the joint venture between Pakistan Petroleum Limited (PPL) and Orion Energy is the reduced cost of investment for each company. Project in the energy sector normally require a high capital outlay where a company may not be in a position to cater for all the cost of the venture. In this case for instance, Pakistan Petroleum Limited could not have the financial ability to solely undertake the project despite being in close proximity to where the project was being undertaken. By undertaking the project jointly the two companies were able to share most of the costs involved which made it possible to undertake the project without financial constraints. When projects are undertaken jointly there is likelihood of there being a higher capital outlay as opposed to one company undertaking the project on its own. The increased capital investment in this case means that the scope of the project can be expanded to bring about higher returns that it would have been the case if the project was undertaken with limited capital (Cole, 2007).

  1. Risk diversification

Risk diversification is another critical factor when undertaking projects in the energy sector. There have been many instance where the projects undertaken did not materialize or bring about the expected outcome. If this is the case then it means that there was total loss of the capital invested in the particular project which can be disastrous if it was being undertaken by a single company. Joint ventures however are advantageous as they ensure that if the project fails then one company does not have to incur all the loss. With the high capital investment that comes about with the joint ventures, there is normally extensive research done before undertaking the project and this helps to minimize cases of the project failing. The minimal capital investment in the joint ventures mean that each of the individual companies will have finances left which it can use to invest in other projects that generate income as opposed to investing all the capital in one project which could fail and result to total losses for the shareholders (Martin, 2010).

  • Diversity in experience and expertise

This is another major benefit that comes about as a result of joint ventures in the energy sector where companies get to being together staff who have different expertise and experience. Combination of the knowledge, skills and experience by managers from Pakistan Petroleum Limited (PPL) and Orion Energy is likely to bring about better outcomes in the project work. The staff from the British origin for instance have wide experience on the global energy market while the staff from PPL have a good experience on the Pakistan energy market where the project is to be undertaken. The staffs from the two companies have been through different experience which makes them well placed to undertake the project jointly and successfully (Kohl, 2013).

Potential issues with the joint venture

There are various issues that are likely to come about in the process of undertaking the Joint venture project between Pakistan Petroleum Limited (PPL) and Orion Energy as follows;

  1. Differences in expectations and objectives

The fact that the two companies have a difference background and have been operating in different markets could result to differences in expectations and objectives. Each company has a different rate of growth and objectives towards achievement of its long term goals. The key stakeholders in the two companies such as the shareholders and top executives could be having different expectation from the joint venture. The variance in interests between the two companies could result to each of them making decisions that are more favorable for them without considering the interests of the other company. If the varying expectations are not met then this could result to the joint venture breaking up (Ireland, 2013).

  1. Poor planning

Poor planning is another issue that is likely to come about with the joint venture that is being undertaken by the two companies. For a project to succeed there has to be proper planning where the different roles to be undertaken are assigned to specific departments and people. Planning is also important in ensuring that there required resources for the project to be undertaken are availed at the right time to ensure that the project starts at the right time and that there are no stoppages. Poor planning could result to conflicts arising in the partnership when one of the partners blames the other as being the main cause for failure and this results to eventual breakup of the partnership (Gazzini, 2014).

  • Governance challenges

Governance is another potential issue that is likely to arise with the partnership. The joint venture brings together managers from the two companies who are expected to work together towards the achievement of the final goal. A challenge could however arise when the managers from one of the companies feel that they are more powerful or influential because their company has contributed a higher capital in the venture. These kind of conflicts in management slows the productivity and achievement of the final goals (Roney, 2003).

  1. Complex decision making

The joint venture is likely to experience a challenge of complexity in the decision making process. The fact that there are managers drawn from the two companies that are required to oversee the project could result to lack of proper coordination in the decision making process. The fact that the two companies are located in different nations with Orion Energy being from the UK could slow down the decision making process especially if the top executives have to be consulted before the final decision can be arrived at (Gruner, 2013).

Recommendations

  1. Establishment of a governance and decision making model

To overcome the issue of conflicts in governance and complexity in decision making, the tow companies should establish a governance and decision making model. The model will offer details of the structure of leadership in the joint venture from the top executives to the lower level managers. The model should also state clearly the roles of each of the managers in the organization and the departments that they head. The individuals to hold the various positions should be selected before the onset of the project and communicated to all the members of the organization. This will help to reduce cases of conflict where some of the managers try to take responsibility over their colleagues without such authority being granted to them. The model will also ensure there is smooth decision making in the organization where it is clear on who is to give the final authorization for the decision to be effected. Effective decision making ensures that changes in the organization are made at the right time in order to take advantage of the opportunities that arise in the market. This recommendation has been ranked first as it will help to solve most of the other issues that come about in the organization. If there is a good management it becomes easier to manage the two partners and ensure that a balance is achieved between their interests and expectations.

  1. Taking time to understand and align partners goals

The variance in interests and expectations from the two partners in the joint venture arise as a result of failure of the partners to take time to understand the varying interests. If the partners take such time and understand why each of them is getting into the partnership, then it is possible to find a balance between the interests and expectations of the two companies. In this way a better working relationship is established where each partners does not focus own interests but also takes into consideration the impacts of decisions made on the other partners. Understanding and alignment of goals should be done on a continuous basis given that the interests of the partners will change from time to time. To enhance understanding of the expectations, there should be regular communication where the progress of the venture is assessed and decisions are made on any changes that need to be made. This recommendation has been ranked second as it is important but can only be achieved if there is a good management structure in place. If the managers are in constant conflicts and the decision making channel is poor, then there cannot be proper understanding and consideration of the partner interests.
Conclusions

In conclusion, joint ventures can be said to be a common undertaking for companies in the energy sector. The main reason for this is the high risk involved in undertaking projects and investment in this sector as well as the high risk. For this reason companies opt to get into joint venture with partners in the same industry and who have similar goal. One such venture is the joint partnership between Pakistan Petroleum Limited (PPL) and Orion Energy which was aimed at exploration and establishment of a gas energy plant in Kandhkot gas field in Pakistan. The key driver for the joint venture was to maximize revenues through investment in a project which would maximize the returns for the two companies. The venture was also aimed at reducing the cost of investment for each of the companies and the risk involved. The main benefits of the joint venture include the sharing of the capital investment which lowers the risk for each of the partners leaving them with capital to invest elsewhere. The venture also combined staff with expertise and varying backgrounds who could work together to offer greater value in achievement of a common goal. Some of the key issues that the joint venture is likely to face include the variation in interests and expectations from the two partners which could result to a break up. Challenges also arise in governance and decision making process or from poor planning and role assignment. To overcome these challenges, an effective governance and decision making model should be established as well as taking time to understand the expectations of each partner.

References

Bern, G. (2011). Investing in energy: A primer on the economics of the energy industry. Hoboken, N.J: Bloomberg Press

Choo, C. W. (2002). The strategic management of intellectual capital and organizational knowledge. Oxford [u.a.: Oxford Univ. Press.

Cole, G. A. (2007). Strategic management: Theory and practice. London: Thomson Learning

Craig, J. C. (2003). Strategic management. London: Kogan Page

Edwards, D. W. (2010). Energy trading & investing: Trading, risk management and structuring deals in the energy markets. New York: McGraw-Hill

Gazzini, T. (2014). Foreign investment in the energy sector: Balancing private and public interests.

Gruner, A. (2013). Multi-Dimensional Risk and Investment Return in the Energy Sector: The Case of Electric Transmission Networks. St. Gallen

Ireland, R. D. (2013). Strategic management: Competitiveness & globalization : cases. Mason, OH: South-Western, Cengage Learning

Jones, G. R. (2012). Strategic Management. Cengage Learning

Kohl, K. (2013). Energy investing for dummies

Martin, F. (2010). Strategic management. Andover: Cengage Learning

Roney, C. W. (2003). Strategic management methodology: Generally accepted principles for practitioners. Westport, Conn: Praeger

March 26, 2015

Comparison of U.K and U.S Healthcare Systems

Name:

Institution:

The NHS was launched in 1948. One of its core principles is to avail good healthcare to all individuals, regardless of their wealth. Statistics indicate that in every 36 hours, the NHS England handles more than 1 million patients. It covers all the services from end-of-life care, antenatal screening, emergency treatment, routine screenings and transplants (Nuwer, 2013). The NHS is renowned for its efficiency, cost-related problems, effective care, patient-centered care and coordinated care. In terms of equity, it ranked second. It has more than 1.6 million employees, and this puts it in the top five bracket of the largest workforces in the world.

Coverage is universal in the NHS, with all of U.Ks ordinary citizens being entitled to healthcare. The NHS covers various things such as services, cost-sharing, safety nets, hospitals, government and private insurance funds. With regards to services, the NHS covers rehabilitation, preventive services, learning disabilities, inpatient and outpatient, mental health care, physician services and dental care. publicly-covered services also have some level of cost-sharing arrangements (Tighe, 2014). The safety nets ensure that the public purse meets most of the costs, with special patient groups being subjected to unique measures that alleviate costs. Hospitals are directly accountable to the Department of Health because they are structured as NHS trusts. General policy matters and health legislation lie with the parliament.

The NHS undertakes various measures to safeguard quality of care. A key focus is to enhance the safety and quality of social and health care services the NHS uses various means to address quality issues. They include regulatory bodies, targets, national service frameworks and quality and outcome framework (Maskileyson, 2014). The regulatory bodies assess and monitor the quality of services that both private and public health care providers give. This involves regular investigations and assessments of all providers. The government sets targets for a range of variables so as to reflect the quality of care. Regulatory bodies are tasked with monitoring these targets.  The NST was developed in 1998 to improve certain areas of care such as diabetes, coronary, mental health and cancer. The quality and outcome framework was newly developed to measure the quality of care that GPs deliver. It serves as an incentive for improving quality.

The NHS also undertakes various measures to improve efficiency. This remains a key focus, and the NHS employs various tactics to ensure this. They include; high-level efficiency targets, benchmarking and institute for innovation and improvement. The government has undertaken measures to increase social care provision efficiency, centralize procurement and reduce costs of NHS provider. The benchmarking of NHS organizations is done against their peers’ performance, including reference costs, readmission rates and day case rates.

In order to control costs, the NHS budget is set by the government on a three-year cycle. The government also gives a capped general budget for PCTs to control costs and utilization. Each year, PCTs and NHS trusts are expected to attain financial balance. The centralized administrative system guarantees lower overhead costs (Kumar, 2014). A significant percentage of the NHS funding comes directly from taxation. In the new changes that have been enacted by the Cameron administration, 80% of the healthcare budget will be handled by the GPs. All hospitals will also be independent from the Department of Health, and should their books fail to balance, private operators will take them over. These reforms are being undertaken for ideological reasons and to save money. Some of the challenges facing the NHS include the steady increase of life expectancy, as well as the increases in chronic diseases like neurological disorders and cancer.

In the United States, healthcare is provided by various distinct organizations. The private sector owns and operates a significant percentage of the health care facilities. Statistics indicate that in the U.S, 20 % of the hospitals are for profit, 20% are owned by the government, whereas 60% are non-profit (Salzberg, 2012).  The healthcare provision in the U.S comes from programs like the Veterans Health Administration, Children’s Health Insurance Program, Medicaid and Medicare. A significant percentage of the country’s population is insured either on their own, or through the employer of a family member. The government provides the public sector employees with health insurance.

Unlike in the U.K, the life expectancy in the U.S is slightly higher at 78.4 years. Some of the challenges that the healthcare system of the country has been struggling with include lung and heart diseases, high obesity rates, homicides and teenage pregnancies (Gwee, 2009). When it comes to medical innovation, America remains a global leader, and this can be attested to by their contribution to medical innovation in the present and past centuries. The U.S health system has been dogged by various factors such as quality, right to health care, value, access, choice, fairness, cost and efficiency. This explains why the country has been trying to institute various reforms to address these concerns. The U.S healthcare system has come under harsh criticisms from some quarters who insist that the quality of care being delivered does not represent value for money as is the case in the U.K.

Healthcare providers in the country encompass medical products, healthcare facilities and health care personnel. Although the county, state and federal governments own some facilities, most of the country’s health care system lies in private hands. Compared to other countries such as the U.K, the U.S healthcare spending is regarded as the most costly. However, the quality of care remains relatively low as can be proven by infant mortality rates (Chen, 2015). The country’s healthcare spending represents about 18% percent of its GDP (Nuwer, 2013). The regulation and oversight of the U.S healthcare system is governed by involved institutions and organizations. The state and federal governments subjects the country’s healthcare system to extensive regulation to safeguard efficiency.

Unlike the U.K, the U.S healthcare system does not pay much attention to equality of care, as the system is often subjected to political interference. The U.S has moved to address these concerns by instituting certain measures of effectiveness including access to care, population health and innovation. These are meant to safeguard affordability, coverage, vulnerable populations, and the U.S workforce.

In conclusion, the U.K and U.S healthcare systems exhibit numerous similarities and differences. Although the U.S system has a better choice of health provider and modern technology, the healthcare is too costly, and this disadvantages the poor citizens (Archibald, 2013). The U.K system is praised for its equality and universality, although some critics suggest that it has long waiting times and a system that is overly-bureaucratic. The U.S system takes advantage of its insurance scheme, whereas the U.K system prides itself in its access to all. Both countries remain keen on providing the best health care to their citizens through various reforms in the sector.

Bibliography

Archibald, M. E., 2013. A spatial analysis of community disadvantage and access to healthcare services in the U.S.. Social Science & Medicine, 90(10), pp. 11-23.

Chen, M.-P., 2015. Bubbles in health care: Evidence from the U.S., U.K., and German stock markets. The North American Journal of Economics and Finance, 31(4), pp. 193-205.

Gwee, M. C.-E., 2009. Problem-Based Learning: A Strategic Learning System Design For The Education Of Healthcare Professionals in the 21ST Century. The Kaohsiung Journal of Medical Sciences, 25(5), pp. 231-139.

Ker, J.-I., 2014. Deploying lean in healthcare: Evaluating information technology effectiveness in U.S. hospital pharmacies. International Journal of Information Management, 34(4), pp. 556-560.

Kumar, D., 2014. Modelling Rural Healthcare Supply Chain in India using System Dynamics. Procedia Engineering, 97(12), pp. 2204-2212.

Maskileyson, D., 2014. Healthcare system and the wealth–health gradient: A comparative study of older populations in six countries. Social Science & Medicine, 119(23), pp. 18-26.

Nuwer, M. R., 2013. Chapter 23 – Public policy and healthcare systems. Handbook of Clinical Neurology, 118(45), pp. 277-287.

Salzberg, C. A., 2012. Policy initiatives for Health Information Technology: A qualitative study of U.S. expectations and Canada’s experience. International Journal of Medical Informatics, 81(10), pp. 713-722.

Seddon, J. J., 2013. Cloud computing and trans-border health data: Unpacking U.S. and EU healthcare regulation and compliance. Health Policy and Technology, 4(2), pp. 229-241.

Tighe, P. J., 2014. Geospatial analysis of Hospital Consumer Assessment of Healthcare Providers and Systems pain management experience scores in U.S. hospitals. PAIN®, 155(5), pp. 1016-1026.

Corporate social responsibility for all sectors to create social difference and enhance reputation/responsibility

March 23, 2015

Corporate social responsibility for all sectors to create social difference and enhance reputation/responsibility
It is unfortunate that at this era, some business leaders still support Milton Friedman argument that “the social responsibility of business is to increase its profits.” (1970, p. 1). Supporting such an argument at such a time while the benefits of using corporate social responsibility (CSR) for business sustainability are evident is misguided. In this age, consumer awareness on environmental and social issues is heightened and it only business that are in denial that can afford to ignore this awareness. Consumers today expect business to take responsibility on the manner in which their operations affect society and natural environment. Hill (2001) highlights that the idea behind CSR is that business must adopt CSR principles to promote sustainability. The author defines sustainability as “an organization’s activities, typically considered voluntary, that demonstrate the inclusion of social and environmental concerns in business operations and in interactions with stakeholders” (Hill, 2001, p. 32). The above means that more than ever before organizations will be judged based on their social roles in society and how well they apply social, ethical, environmental, and responsible standards in running their business operations.
In the article The Case against Corporate Social Responsibility, Karnani (2010) argues that companies cannot claim to serve a social purpose and earn profits at the same time. This is because when companies act in the public interest to create sustainable businesses, they go against shareholders interest, which is to increase profits. However, Du, Bhattacharya, and Sen (2007) believe that it is possible to strike a balance between public interest and shareholder interests. CSR strategies are aimed at making the world a better place by ensuring that organizations produce healthier foods, make fuel-efficient equipments, conserve non-renewable energy, and treat their employees in an ethical manner.
Today’s consumer is not just interested at price and quality of goods and services, but they also expect the companies to use some part of the profit to make a social impact. The squabble that correlating public interest and shareholders interest is impossible misses the point that “Corporate social responsibility (CSR) activities have the potential to create several distinct forms of value for customers. It is the customer perception of this value that mediates the relationship between CSR activities and subsequent financial performance.” (Noked, 2011, par. 2).
It is understandable that those against CSR are worried that they may not be able to measure the outcomes from CSR investments on how they enhance the profitability of the firm. Perhaps they should consult tons of research that positively demonstrate that “CSR leads to outcomes such as increased customer loyalty, willingness to pay premium prices, and lower reputational risks in time of crisis.” (Du, Bhattacharya & Sen, 2007, p. 232). Rather than risk a bad reputation that has more impact on a firm’s profitability, it is better to adopt CSR because each of the above outcomes has the potentiality to increase profitability of the firm.
Perhaps the reason why some companies are quick to downplay the effectiveness of CSR on business profitability is that they do not communicate their activities to the public, thus their activities doe not garner the intended benefits. Bortree (2014) emphasizes that CSR communication is as important as activities, but some organizations seems to forget this important step during CSR implementation. The research is clear that communication about CSR “can lead to stronger relationships with publics, more positive attitudes among stakeholders, and increase its legitimacy outlook (Bortree, 2014, p. 5). It is important to note that, CSR activities like the one undertaken by “controversial industry sectors” (sod, beer, gambling e.t.c.) might attract a lot of scepticism in the public, but as Dorfman et al. (2012) argue “how companies communicate their CSR activities may determine the degree to which the public accepts the programs as legitimate (5). In fact, I believe that no company requires CSR programs as the companies in the ‘controversial industry’ to help the companies to revert the negative views among the public. The latter authors also add that engaging in CSR activities demonstrate that the previously mentioned companies accept their ethical and social obligation to society at large (Dorfman et al., 2012). It is obvious that the public image of such like companies is already at risk, and since they have to protect their core business, then CSR becomes the better option as the companies try to pass off their innocence to the consumers.
Factually, even those companies that claim not to engage in CSR are somehow undertaking activities to create a good reputation, so why not engage in corporate social responsibility and create social good in society, while u reap largely from doing good? CSR programs are diverse and they are manifested in many forms including philanthropy, ethical business practices, and product-based activities (Du, Bhattacharya & Sen, 2007). However, organizations do not have to undertake all forms of CSR, for even a little effort will go a long way in enhancing public image and presenting the business as legitimate. CSR is not just for the ‘sinful’ industry, as the activities are for every business that wants to create a social difference by doing well to do good.

References
Bortree, D.S. (2014). The State of CSR Communication Research: A Summary and Future Direction. Public Relations Journal, 8(3): 1-8.
Dorfman L, Cheyne A, Friedman LC, Wadud A, Gottlieb M (2012) Soda and Tobacco Industry Corporate Social Responsibility Campaigns: How Do They Compare? PLoS Med 9(6): e1001241. doi:10.1371/journal.pmed.1001241.
Du, S., Bhattacharya, C. B., and Sen, S. (2007). Reaping Relational Rewards from Corporate Social Responsibility: The Role of Competitive Positioning. International Journal of Research in Marketing 24, no. 3 (2007): 224-241.
Friedman, M.(1970, Sept. 13) The social responsibility of business is to increase its profits. The New York Times. Retrieved from http://www.colorado.edu/studentgroups/libertarians/issues/friedman-soc-resp- business.html.
Hill, J. (2001). Thinking about a more sustainable business: An indicators approach. Corporate `Environmental Strategy, 8(1),30–38.
Karnani, A. (2010, Aug. 23). The case against corporate social responsibility. The Wall Street Journal. Retrieved from http://www.wsj.com/articles/SB10001424052748703338004575230112664504890.
Kotler, P., & Lee, N. (2005). Corporate social responsibility: Doing the most good for your company and your cause. Hoboken, NJ: Wiley.
Noked, N. (2011, Feb. 28). Investing in Corporate Social Responsibility to Enhance Customer Value. The Harvard Law School Forum on Corporate Governance And Financial Regulation. Retrieved from http://blogs.law.harvard.edu/corpgov/2011/02/28/investing- in-corporate-social-responsibility-to-enhance-customer-value/.

Madeleine

March 23, 2015

Madeleine

Name

Course

Institution

Date

There exists a small cake from France that is known to be light, supple and is the size of a tennis ball, yet for generations past, when eaten it has been said to bring to mind powerful memories of history past. I am talking about the modest madeleine, which according to many people is the creation of a French. This article seeks to talk about this madeleine cake, its features and origin.

For those lucky enough to have eaten a Madeleine cake, it sure was a surprise to all of them that a cake so simple and plain could set off such a gushing inundation of recollections. For others, the madeleine cake will everlastingly have an exceptional place in the midst of the pantheon of cakes and snacks and biscuits that make our tea times a little bit sweeter. So, what is a Madeleine cake? It is one of the many pastries that the French people came up with and instantly spread throughout  France like wild fire. It size is unique and for the duration of its existence, there has been no notable to changes in its recipe, size or shape. Another plus for this cake is the fact that its mould is unique unlike the rest of the cakes and it look like the cake has been baked from the  inside of a sea shell. Its recipe starts just like any other cakes with the usual components of flour, sweeteners and eggs; they then go through the process of mixing these ingredients. In order to complete the mouth watering madeleine cake, the mixture is soaked with lemon juice and then using a spoon, it is poured into the mould and taken to the baking oven (Madeleine, & Achilleos, 2012).  Of course the outcome is a delicate, brittle, wet madeleine cake which has a humped shape. It is touted as a stylish rather than elaborate pastry; it just sits there patiently waiting and asking to be dipped in a steaming cup of tea.

Although versions of the story will vary, the cake is believed to be a time-honored delicacy from a town called Commercy and its neighbor Liverdun, two towns found in the Lorraine area of northern France. It has now made its way across the globe never losing its French allure and some now claim that it tastes better when dipped in honey. The effect is a sweet and sour taste that has been called the taste of northern France. It has been baked in their kitchens at home since the 18th century and has now become commercialized being sold from the local shops and street vendors to five star hotels. It is the recommended pastry in most tea parties and not even in France alone but as far as Europe. It has been called a comfort food as people like the conflicting bitter sweet taste in their mouth that makes them stop worrying about other things. The madeleine is given as gifts between friends, neighbors and even used as rewards for well behaved children.

In conclusion, eating a madeleine is like eating 18th century France, the madeleine is not bound by gender, religion or generation meaning that its appeal of such an experience should make anyone want to get a feel of this wonderful creation that is the madeleine no matter where one is from.

References

Madeleine, & Achilleos, A. (2012). We love madeleines. San Francisco, Chronicle Books. http://overdrive.torontopubliclibrary.ca/ContentDetails.htm?ID=398204BB-3386-4D6C-AABA-0DED6545DBC8.

Addressing Family Conflict and Family Dynamics in the stories Sonny’s Blues and Two Kinds

March 21, 2015

Name

Professor

Title

Date

  1. Analyze how the families, their relationships and problems are represented in Sonny’s blues written by James Baldwin.

Answer

This is a true story told by a narrator of his young brother Sonny. He narrates how his brother struggled with issues to do with family, education, and his personal ambitions and eventually gave up, indulging into drug abuse. He is informed from a newspaper that sonny was arrested. Out of bitterness, he decides not to visit or even write to him while in prison. After teaching, on his way home, he meets up one of Sonny’s friends whom he despised and felt pity for at the same time. They start talking about sonny and the fact that his current lifestyle is a source of anguish to many.

However, when his daughter Grace dies of polio, he writes to Sonny while in prison. Sonny responded with an explanation of the reasons why he was in the current situation. They keep in touch until he is released from prison. The narrator takes him to his house. There is an element of flashback where the narrator recalls how his brother and father used to fight, how his mother constantly reminded him never to abandon his younger brother and warned him of the guilt he will have if he does so.

It was after their mother died, that Sonny spoke to the narrator about his passion of being a jazz musician, something he ignored and insisted that he should clear school first. He clashed with his sister in law on several occasions because of playing the piano and skipping school to stay with other musicians. A fight ensued and he was compelled to move out and join the navy.      The two brothers lost touch until after the war. Upon reconciliation, they fought again over Sonny’s decisions in life and it was very ugly. It even reached a point that Sonny told him to his face that he does not recognize him as a brother. After a while, the narrator becomes suspicious of his small brother and decides to search his room. He is distracted by beautiful music from outside. At that moment, sonny comes in to invite him to watch him play the music. As they went to the club and the narrator sees the passion in Sonny’s eyes as he played the piano to a crowd that adored him, he was awed and discovered who Sonny really was.

This story is a good basis that teaches us to respect individual decisions and offer moral support to each other. Brothers need to be there for each other in good and bad times regardless of the decisions one makes. When it comes to family, one has to forgive them for they do not know what they do, to accept them because they have no other choice. They will always put you to the test, but you should always try to do your best and just pray for God to do the rest. One can choose their lovers, pick friends but cannot pick the family they are in. It is important to know that they will be with you to the end because they are family.

  1. Analyze the family issues in Two Kinds written by Amy Tan

Answer

The Two Kinds is a story told by a Chinese American woman named June. She was the protagonist unlike the story on Sonny’s Blues where Baldwin was the antagonist. She tells of the struggle she faced inside herself, wanting to live up to the expectations of her mother, an Asian immigrant. When the mother left China, she left behind two twins and came to reside in America. June’s mother wanted her to become a prodigy.

She bought her books and magazines that trained her how to be sharp and carry herself intellectually as a prodigy. June had the will to be what her mother wanted. She allowed her mother to train her on how to become a Chinese Shirley Temple. Through that, every time the mother saw that June was not getting perfect, she would be angry and this made June resentful.

With the view that she wanted to pursue her dreams, she stopped wanting to be perfect just to please her mother. Sometime later, while watching a small Chinese girl performing, June’s mother decided that her daughter was to be a pianist. She enrolled her for piano lessons with a deaf teacher. At the end, when she was expected to present in a talent show, she disappointed everyone by singing a very bad tune. She thought that her mother’s pursuit would end but she pushes her further and eventually June bursts and speaks harshly to her mother, she even tells her she wishes she was dead like the twins the mother had left in china.

June sees this as a conflict which went unresolved and has followed her to adulthood. She felt like she had disappointed her mother who later accepted the defeat. Before she died, she gave June a piano on her thirty first birthday as a peace offering, a symbol of the reconciliation she really needed in her heart.

This story is important in reminding the parents to allow their children pursue their dreams. They should not instill things that are not necessary in a baby’s life because they will grow up unhappy. It teaches on the fact that unconditional love should be exercised in the family setting and forgiveness and reconciliation are important keys to freedom.

In conclusion, both stories have the same teachings on the importance of sticking together as a family till the end. Even in death the family should be close knit. This is achieved through ensuring that each individual needs are taken care of and their views heard (Greenberg & Watts 127. Everyone is important and they have different talents, it is necessary that all parties should understand who they are and what they want in life. This will aid in strengthening the weaker branches. Abandoning each other cannot solve anything, instead, challenges should be faced together knowing that no matter what tide comes, you always have each other’s back as a family.

The families should find better ways of solving their conflicts because in a family set up, some are preachers, some are gay, some are addicts, drunkards or strange but not even one is turned away because they are family (Greenberg &Watts 129). As a family, it is important to accept each one and let your heart be an open door. The members are the mirror of the worst and best in you and therefore, it is paramount to give out your best as a member.

Work Cited

Greenberg, Brian & Watts, Linda. Family: a place where life begins. New York: MacMillan Publishers. 2009. Print.

CAPITAL ASSET PRICING MODEL (CAPM) AND THE FAMA FRENCH THREE FACTOR MODEL

March 20, 2015

Question One

Assumptions of Capital Asset Pricing Model (CAPM)

Sharp (1964) and Lintner (1965), made a number of assumptions with regard to the formulation of the Capital Asset Pricing Model. These assumptions and their implications in the real world are outlined as follows;

In the first place, each individual investor can invest any portion of his capital resources in specific risk free assets such as treasury bonds that pay a given exogenously determined interest rates.

Implication

The implication of the assumption is that the risk averse investors would have a range of portfolio of assets to choose from that will ensure that the overall portfolio risk is minimized. In addition it is possible for investors to evaluate the market risk premium of their portfolio of assets. Secondly, the investor can invest any portion of his capital resources in a number of risky securities that are traded in the market.

Implications

The implication of the assumption is that investors who are risk takers would be able to choose a portfolio of risky assets that would ensure that they maximize their portfolio returns with a given level of risk due to the fact that market securities are more risky compared to the risk free securities.

In addition, investors participate in a purely competitive market in which there are no transaction costs as well as personal and corporate taxes. This means that investors trade their securities in a perfectly competitive market.

Implications

The implication for this assumption is that securities markets are perfectly efficient and all investors have all the available stock information which implies that there are no insider dealings. In addition, the assumption implies that investors do not incur transaction brokerage costs.

Additionally, the paper by Sharpe (1964) and Lintner (1965) makes an assumption that investors may borrow any amount of money so as to invest in any risky assets that earn a higher return compared to the risk free assets.

Implications

The implication of the assumption is that investors may borrow money from the capital market or reduce their proportions of funds allocated for risk free assets so as to invest in risky assets and increase their overall portfolio returns. Moreover, investors can make purchases and sales transactions of their securities at a certain discrete transaction points.

Implications

The implication of this assumption is that the investors use a standardized single period transaction horizon which implies that the returns of the market securities can only be compared to the returns on the risk free securities after a certain period e.g. six months or after one year. The papers also make an assumption that investors’ capital consist of the cash and other resources that are specifically set aside for profitable investments in market securities.

Implications

The implication is that there is no competition for investors’ funds with respect to the need for liquidity transaction requirements as well as investments requirements. In addition, the papers make an assumption that each investor trading in market securities and risk free securities will have a given unique utility indifference curve that specifies their risk return preference for a given portfolio.

Implication

The implication of the assumption is that investors can choose to select portfolios with a higher market returns for the same risk or portfolios with a lower risk for the same market return. Finally, the papers by Sharpe and Lintner, assume that investors will always be rational and would always seek to maximize their wealth or portfolio value

Implication

The implication of this assumption is that if any two compositions of assets have the same expected returns investors would prefer the one with a smaller variance while if any two mixture of assets have the same variance, then investors would prefer the one with a greater market returns.

Question Two

Validity of the Capital Asset Pricing Model (CAPM) Assumptions

Investments in Risk-Free Assets

The assumption that each investor can invest a portion of his capital in certain risk free assets is valid in the real world. This is because there are numerous risk free assets that are available today such as treasury stocks and bonds. However, the breach of this assumption would imply that investors will only be able to select portfolios that consist of risky assets only and moreover, there would be no risk premium returns as well as the capital market line for investors.

Investments in Risky Assets

The assumption that investors can invest a portion of their capital in a number of risky assets is valid both in the ideal and the real world. This is because various capital markets have a number of securities that earn a higher market return although they are much risky compared to the risk free assets.

The implication for the CAPM if this assumption is breached is that portfolio return would be equal to the risk free return only and that investors would not be able to earn the risk premium on any given portfolio of assets.

Perfectly Competitive Securities Markets

The assumption that investors trade securities in perfectly competitive markets is not valid in the real world. This is because there is no capital market that is perfectly efficient since in most securities market, there are is much transaction costs in the form of brokerage costs and other personal and corporate taxes.

However, the implication if this assumption is breached is that the capital market line would not be linear. This is because, investors would be making their portfolio choices while considering the effect of the transaction costs and taxes rather than based on only the risk- return tradeoff.

Investors Borrow to Invest in Risky Assets

This assumption that investors are free to borrow any amount of money so as to invest in risky assets is valid in the real world. This is because; the capital market allows investors to borrow so as to invest in more risky assets. Alternatively, investors may reduce their proportions of funds that are invested in the risk free assets so as to increase their portfolio of risky assets that earn higher income. However, if this assumption is breached, the implication is that investors may not be able to move along their indifference curve so as to obtain an optimal portfolio of assets.

Single Transaction Period Horizon

This assumption is valid in the real world due to the fact that comparisons of the assets returns and risk is usually done after a specific period of time such as annually. The implication if this assumption is breached is that investors and analysts might find it difficult to compare and analyze the returns and risks of both the risky assets as well as the risk free assets.

Investors’ Funds for Capital Investment is Distinct

This assumption is much valid in the real world due to the fact that almost all investors have cash that is dedicated for liquid transactions as well as cash for investment purposes.

The implication if this assumption is breached is that investors may decide to use the funds available for the purchase of securities for their own personal transactions and thus reduce the proportion of securities in their portfolio.

Investors make Rational Investment Decisions

This assumption is valid in the real world due to the fact that each investor would always want to maximize his portfolio returns subject to a given risk preference. If this assumption is breached is that the investors’ indifference curves, the implication would however not be concave. This implies that there would be instances when investors would choose assets that have a higher variance for any given mix of assets that have the same return.

Question Three

CAPM Regression Model for “Fama French” 30 Year Data Series: Telecommunications Industry Security

Using the excess return model; R_pt – R_ft = α + b*(R_mt – R_ft) + ε_t an empirical test of the CAPM using the data file “Fama French”, the following CAPM regression model was derived from the results shown in table 1 (Appendix 1). R_pt – R_ft = 0.19 + 0.43 (R_mt – R_ft) + ε_t

(0.16)  (0.02)

With an adjusted R square of 57%, the model seems to be statistically significant due to the fact that 57% of the variations in the excess returns of the market portfolio are explained by the movement in the Telecommunication security market premium.

Hypothesis Testing

Given that H_ (0): α = 0

H_ (1): α = 0

In addition, the t-statistic from the regression results indicate that α has a t-statistic of 1.21. Therefore, since t = 1.21 < than t 0.95 = 1.96 then the CAPM regression model agrees with the null hypothesis which implies that both the model and its intercept α are statistically significant.

CAPM Regression Model for “Fama French” 30 Year Data Series: Health Industry Security

The following CAPM regression model was derived from the results shown in table 2 (Appendix 1) using the excess return model.

R_pt – R_ft = 0.08 + 0.42 (R_mt – R_ft) + ε_t

(0.17)  (0.02)

With an adjusted R square of 50%, the model seems to be relatively statistically significant due to the fact that 50% of the variations in the excess returns of the market portfolio are explained by the movements in the Health security market premium.

Hypothesis testing

Given that H_ (0): α = 0

H_ (1): α = 0

The t-statistic from the regression results indicate that α has a t-statistic of 0.47. Therefore, since t = 0.47 < t 0.95 = 1.96 then the null hypothesis is accepted and that both the model as well as its intercept α are statistically significant at 95% confidence level.

 

 

CAPM Regression Model for “Fama French” First 10 Year Data Series: Telecommunications Industry Security

The following CAPM Regression model was derived from the results shown in table 3 (Appendix 1) using the excess return model.

R_pt – R_ft = -0.07 + 0.67 (R_mt – R_ft) + ε_t

(0.25)  (0.04)

Given that the adjusted R square for this model is 69%, then the model seems to be statistically significant due to the fact that 69% of the variations in the excess market portfolio returns are explained by the variations in the Telecommunications industry security market return premium.

Hypothesis Testing

Given that H_ (0): α = 0

H_ (1): α = 0

The t-statistic from the regression results indicate that α has a t-statistic of -0.26. Therefore, since t = (-0.26) < t 0.95 = 1.96, then the null hypothesis is accepted and that both the model as well as it’s α will be significant at 95% confidence level.

CAPM Regression Model for “Fama French” First 10 Year Data Series: Health Industry Security

The model below was derived from the results depicted in table 4 (Appendix 1) using the excess market portfolio return model.

R_pt – R_ft = 0.28 + 0.59 (R_mt – R_ft) + ε_t

(0.24)  (0.04)

The adjusted R square for the model is 70% which implies that almost 60% of the variations in the excess market portfolio returns are explained by the movement in the Health industry security market return premium.

Hypothesis Testing

Given that H_ (0): α = 0

H_ (1): α = 0

The t-statistic from the regression results indicate that α has a t-statistic of 1.17. Therefore given that the value of t = 1.17 < t 0.95 = 1.96, then both the model as well as its intercept α are statistically significant.

CAPM Regression Model for “Fama French” Second 10 Year Data Series: Telecommunications Industry Security

The model below was derived from the results depicted in table 5 (Appendix 1) using the excess return market portfolio model.

R_pt – R_ft = 0.33 + 0.30 (R_mt – R_ft) + ε_t

(0.26)  (0.05)

The adjusted R square for the model is 53% which implies that almost 53% of the variations in the excess market portfolio returns are explained by the movement in the Telecommunications industry security market return premium.

Hypothesis Testing

Given that H_ (0): α = 0

H_ (1): α = 0

The t-statistic from the regression results indicate that α has a t-statistic of 1.17. Therefore given that the value of t = 1.29 < t 0.95 = 1.96, then both the model as well as its intercept α are statistically significant.

CAPM Regression Model for “Fama French” Second 10 Year Data Series: Health Industry Security

The model below was derived from the results depicted in table 6 (Appendix 1) using the excess return market portfolio model.

R_pt – R_ft = 0.60 + 0.36 (R_mt – R_ft) + ε_t

(0.29)  (0.04)

The adjusted R square for the model is 40% which implies that almost 40% of the variations in the excess market portfolio returns are explained by the movement in the Health industry security market return premium.

Hypothesis Testing

Given that H_ (0): α = 0

H_ (1): α = 0

The t-statistic from the regression results indicate that α has a t-statistic of 2.09. Therefore given that the value of t = 2.09 < t 0.95 = 1.96, then both the model as well as its intercept α are not statistically significant which implies that the null hypothesis is rejected.

CAPM Regression Model for “Fama French” Final 10 Year Data Series: Telecommunications Industry Security

The model below was derived from the results depicted in table 7 (Appendix 1) using the excess return market portfolio model.

R_pt – R_ft = 0.016 + 0.35 (R_mt – R_ft) + ε_t

(0.27)  (0.03)

The adjusted R square for the model is 60% which implies that almost 60% of the variations in the excess market portfolio returns are explained by the movement in the Telecommunications industry security market return premium.

Hypothesis Testing

Given that H_ (0): α = 0

H_ (1): α = 0

The t-statistic from the regression results indicate that α has a t-statistic of 0.06. Therefore given that the value of t = 0.06 < t 0.95 = 1.96, then both the model as well as its intercept α are statistically significant at 95% confidence level.

CAPM Regression Model for “Fama French” Second 10 Year Data Series: Health Industry Security

The following model was derived from the results depicted in table 8 (Appendix 1) using the excess return market portfolio model.

R_pt – R_ft = -0.61 + 0.36 (R_mt – R_ft) + ε_t

(0.32)  (0.04)

The adjusted R square for the model is 46% which implies that almost 46% of the variations in the excess market portfolio returns are explained by the movement in the Health industry security market return premium.

Hypothesis Testing

Given that H_ (0): α = 0

H_ (1): α = 0

The t-statistic from the regression results indicate that α has a t-statistic of -1.88. Therefore given that the value of (t = -1.88) < t 0.95 = 1.96, then both the model as well as its intercept α are statistically significant.

Validity of the Empirical Model to the CAPM Theory

This model agrees with the Capital Asset Pricing Model theory in various aspects. In the first place, the standard error of the model using the 30 year data series indicate that the value of 3.00 and 3.23 for the telecommunication and health industry respectively is a bit higher compared to the standard deviation of a portfolio that consist of both industries which is computed at 2.89. This therefore, agrees with the CAPM theory that if the correlation coefficient between the securities of the two industries is less than 1, then the portfolio that comprises both securities would have a much smaller variance compared to the variance of each individual security. This is the effect of diversification. In addition, the model is statistically significant, which implies that its validity to the CAPM theory is much higher. This is evidenced by the positive beta coefficient.

Question Four

Background and Features of the Fama French Three Factor Model

The Fama French three-factor model is an asset valuation model that specifically expands on the Capital Asset Pricing Model by including in the model the size and value factor of a certain security in addition to the risk factor that is normally considered under CAPM. This model was formulated by Fama and French who sought to find a formula that would better measure market returns than is provided under CAPM.

The features of the Fama French three-factor model include the fact that the model incorporates the size of the security as well as the value of the security in addition to the risk factor that is normally considered under CAPM. In addition, the model assumes that the small cap stocks with a higher value tend to outperform most securities in the capital market. In essence, the three factor model states that higher value stocks tend to outperform growth stocks while small cap stocks tend to outperform large cap stocks. Finally, the model seems to provide a better evaluation tool compared to the CAPM Model.

Question Five

Fama French Three Factor Model: Telecommunications Industry Security

Using the excess return portfolio model, an empirical test was conducted to test the validity of the Fama French Model. The following regression model was obtained:

R_pt – R_ft = 0.26 + 0.47 (R _mt – R_ft) -0.34(SMB) _t -0.15(HML) _t + ε_t

(0.15)  (0.02)                         (0.06)                (0.05)

With an adjusted R square of 61%, the model seems to be statistically significant due to the fact that 61% of the variations in the excess return portfolio model are explained by the telecommunications security market return premium as well as the size and value of the securities in the portfolio.

Hypothesis Testing

Given that H_0: α = 0, b = 0, s = 0, h = 0

H_1: α = 0, b = 0, s = 0, h = 0

The t-statistic from the regression results indicate that t α = 1.67, t b = 20.9, t s = -6.2, t h = -2.76. When the statistical t is compared to the t 0.95 = 1.96, then the null hypothesis for the model intercept α will be the only one accepted. Therefore, the rest of the coefficients would not pass the test and will be considered not statistically significant.

Fama French Three Factor Model: Health Industry

Using the excess return portfolio model, an empirical test was conducted to test the validity of the Fama French three factor model based on the health industry security. The following model was obtained.

R_pt – R_ft = 0.04 + 0.57 (R _mt – R_ft) -0.64(SMB) _t -0.11(HML) _t + ε_t

(0.15)  (0.03)                         (0.06)                (0.05)

The model also has an adjusted R square of 61% which implies that 61 % of the variations in the excess return portfolio model are explained by the movements in the health industry market risk premium as well as the size and value of the securities in the portfolio.

Hypothesis Testing

Given that H_0: α = 0, b = 0, s = 0, h = 0

H_1: α = 0, b = 0, s = 0, h = 0

The t-statistic from the regression results indicate that t α = 0.25, t b = 20.9, t s = -10, t h = -2.10. When the values of the statistical t are compared to the t 0.95 = 1.96, only the model’s intercept passes the test due to the fact that tα = 0.25 < t 0.95 . The other coefficients failed to pass the hypothesis test and would thus be considered not statistically significant at 95% confidence level.

Implication of the Empirical Results to the Fama French Theory

The results of the empirical results tend to prove the validity of the Fama French theory. This is because, in the first place, the stock size coefficient in the model is negative and less than one. This implies that a small cap stock that is indicated by a small stock size coefficient, will lead to an increase in the excess portfolio return in the model. Moreover, the stock value coefficient in the model similarly implies that it would cause an increase in the value of the excess portfolio return.

Moreover, the Fama French three-factor model tends to explain a higher proportion of the variations in the stock’s beta compared to the CAPM. This is due to the fact that the coefficient of determination in the CAPM model which is 57% and 50% for the telecommunication and health industry respectively is much a lower compared to the coefficient of multiple determinations of 61% each for both the telecommunications and health industry respectively.

Comparison of the Fama French Three Factor Model and CAPM Results

The main difference between the results from the Fama French three factor model and the CAPM model is that the Fama French three factor model has a greater explanatory power with an adjusted R square of 61% compared to the adjusted R square of 50% and 57% for the telecommunications and the health industry respectively. There the Fama French model is a better evaluation tool for managers.

References

Craig, MA 2006, ‘Multifactor models do not explain deviations from the CAPM’, Journal of Financial Economics, vol. 38, no. 1. pp. 3-28.

Harvey 2013, ‘The risk exposure of emerging equity markets’, World Economic Review, vol. 9, no. 1, pp. 19-50.

John, P 2014, The Fama French three factor model [online] Available from: <https://www.portfoliosolutions.com&gt; [Accessed on 11th December 2014]

Lintner, J 2013, ‘The valuation of risk assets and the selection of risky investments in stock portfolios and capital budget’, The Review of Economics and Statistics, vol. 47, no. 1, pp. 13-37

Lintner, J 2014, ‘The valuation of risk assets and the selection of risky investments in stock portfolios and capital budget’, The Review of Economic and Statistics, vol. 47, no. 1. pp. 13-37.

Perold, FA 2004, ‘The Capital Asset Pricing Model’, Journal of Economic Perspective, vol. 18, no. pp. 3–24.

Reinganum, MR 2012, ‘The anomalous stock market behaviour of small firms in January’, Journal of Financial Economics, vol. 38, pp. 89-104.

Sharpe, FW 2014, ‘A theory of market equilibrium under conditions of risk’, American Finance Association, vol. 19, no. 3, pp. 425-442.

Wilcox, JW 2001, ‘Taming frontier markets’, Journal of Portfolio Management, vol. 19, no. 1, pp. 51-55.

Wilcox, JW 2002, ‘Taming frontier markets’, Journal of Portfolio management, vol. 20, no. 1, pp. 50-57.

 

Appendix 1: Summary Output for the CAPM Regression

Table 1: Summary Output for “Fama French” CAPM Regression using the 30 Year Data Series: Movement of the Excess Return Market Portfolio with the Telecommunications Industry Security

Regression Statistics
Multiple R 0.75767723
R Square 0.57407479
Adjusted R Square 0.57288506
Standard Error 3.00194143
Observations 360
ANOVA
  df SS MS F
Regression 1 4348.330949 4348.331 482.5232
Residual 358 3226.171551 9.011652
Total 359 7574.5025
  Coefficients Standard Error t Stat P-value
Intercept 0.19310535 0.159011321 1.214413 0.225391
X Variable 1 0.42538976 0.019365466 21.96641 2.48E-68

Table 2: Summary Output for “Fama French” CAPM Regression using the 30 Year Data Series: Movement of the Excess Return Market Portfolio with the Health Industry Security

Regression Statistics
Multiple R 0.71137184
R Square 0.5060499
Adjusted R Square 0.50467015
Standard Error 3.23278693
Observations 360
ANOVA
  df SS MS F
Regression 1 3833.076232 3833.07623 366.7696
Residual 358 3741.426268 10.4509114
Total 359 7574.5025
  Coefficients Standard Error t Stat P-value
Intercept 0.08026852 0.172079981 0.46646053 0.64117
X Variable 1 0.41993212 0.021927163 19.1512289 8.72E-57

Table 3: Summary Output for “Fama French” CAPM Regression using the First 10 Year Data Series: Movement of the Excess Return Market Portfolio with the Telecommunication Industry Security.

SUMMARY OUTPUT
Regression Statistics
Multiple R 0.832764479
R Square 0.693496678
Adjusted R Square 0.690899192
Standard Error 2.712641994
Observations 120
ANOVA
  df SS MS F
Regression 1 1964.609175 1964.609 266.9877
Residual 118 868.2943372 7.358427
Total 119 2832.903513
  Coefficients Standard Error t Stat P-value
Intercept -0.06746535 0.252144638 -0.26757 0.7895
X Variable 1 0.665755428 0.040744511 16.33976 4.39E-32

Table 4: Summary Output for “Fama French” CAPM Regression using the First 10 Year Data Series: Movement of the Excess Return Market Portfolio with the Health Industry Security.

SUMMARY OUTPUT
Regression Statistics
Multiple R 0.839878081
R Square 0.705395191
Adjusted R Square 0.70289854
Standard Error 2.659468214
Observations 120
ANOVA
  df SS MS F
Regression 1 1998.316513 1998.317 282.5366
Residual 118 834.5869996 7.072771
Total 119 2832.903513
  Coefficients Standard Error t Stat P-value
Intercept 0.284483163 0.244083703 1.165515 0.246161
X Variable 1 0.592069084 0.035223706 16.80882 4.21E-33

Table 5: Summary Output for “Fama French” CAPM Regression using the Second 10 Year Data Series: Movement of the Excess Return Market Portfolio with the Telecommunications Industry Security.

SUMMARY OUTPUT
Regression Statistics
Multiple R 0.7358754
R Square 0.5415126
Adjusted R Square 0.5336752
Standard Error 2.7256613
Observations 120
ANOVA
  df SS MS F
Regression 2 1026.622521 513.3113 69.09347
Residual 117 869.2198661 7.42923
Total 119 1895.842387
  Coefficients Standard Error t Stat P-value
Intercept 0.3320095 0.257039962 1.291665 0.199019
X Variable 1 0.304937 0.052032705 5.860487 4.35E-08

Table 6: Summary Output for “Fama French” CAPM Regression using the Second 10 Year Data Series: Movement of the Excess Return Market Portfolio with the Health Industry Security.

SUMMARY OUTPUT
Regression Statistics
Multiple R 0.637905779
R Square 0.406923783
Adjusted R Square 0.401897714
Standard Error 3.086848854
Observations 120
ANOVA
  df SS MS F
Regression 1 771.4633568 771.4634 80.96262
Residual 118 1124.37903 9.528636
Total 119 1895.842387
  Coefficients Standard Error t Stat P-value
Intercept 0.599681714 0.286468722 2.093358 0.038459
X Variable 1 0.35531713 0.039488793 8.997923 4.66E-15

Table 7: Summary Output for “Fama French” CAPM Regression using the Final 10 Year Data Series: Movement of the Excess Return Market Portfolio with the Telecommunications Industry Security.

SUMMARY OUTPUT
Regression Statistics
Multiple R 0.779549619
R Square 0.607697609
Adjusted R Square 0.604373013
Standard Error 3.0252627
Observations 120
ANOVA
  df SS MS F
Regression 1 1672.91843 1672.918 182.7884
Residual 118 1079.9613 9.152214
Total 119 2752.87973
  Coefficients Standard Error t Stat P-value
Intercept 0.016023084 0.276428938 0.057965 0.953875
X Variable 1 0.348886763 0.025805377 13.51993 9.88E-26

Table 8: Summary Output for “Fama French” CAPM Regression using the Final 10 Year Data Series: Movement of the Excess Return Market Portfolio with the Health Industry Security.

SUMMARY OUTPUT
Regression Statistics
Multiple R 0.687874887
R Square 0.47317186
Adjusted R Square 0.468707215
Standard Error 3.505799683
Observations 120
ANOVA
  df SS MS F
Regression 1 1302.585223 1302.585 105.982
Residual 118 1450.294507 12.29063
Total 119 2752.87973
  Coefficients Standard Error t Stat P-value
Intercept -0.609372121 0.323177203 -1.88557 0.061812
X Variable 1 0.362752446 0.035236631 10.29475 4E-18

Appendix 2: Fama French Three Factor Model

Table 1: Summary Results for Fama French Three Factor Model: Telecommunications Industry Security

SUMMARY OUTPUT
Regression Statistics
Multiple R 0.786856078
R Square 0.619142488
Adjusted R Square 0.615933015
Standard Error 2.846645067
Observations 360
ANOVA
  df SS MS F
Regression 3 4689.696323 1563.232 192.9109
Residual 356 2884.806177 8.103388
Total 359 7574.5025
  Coefficients Standard Error t Stat P-value
Intercept 0.2557664 0.15303518 1.671292 0.095543
X Variable 1 0.46890494 0.022427955 20.90716 6.78E-64
X Variable 2 -0.34431206 0.05528231 -6.22825 1.33E-09
X Variable 3 -0.14558302 0.052716972 -2.7616 0.00605

Table 2: Summary Results for Fama French Three Factor Model: Health Industry Security

SUMMARY OUTPUT
Regression Statistics
Multiple R 0.787283913
R Square 0.61981596
Adjusted R Square 0.616612161
Standard Error 2.844127087
Observations 360
ANOVA
  df SS MS F
Regression 3 4694.797535 1564.933 193.4629
Residual 356 2879.704965 8.089059
Total 359 7574.5025
  Coefficients Standard Error t Stat P-value
Intercept 0.039098143 0.154680088 0.252768 0.800594
X Variable 1 0.570019499 0.027220603 20.94074 4.94E-64
X Variable 2 -0.636800296 0.062449528 -10.197 1.37E-21
X Variable 3 -0.109502327 0.053236389 -2.05691 0.040423