Assignment: Macroeconomic Trends and Offshoring
Select one of IndustryWeek magazine's best 50 U.S. manufacturers, which are posted at IndustryWeek and select a product produced by that manufacturing firm. Do not select Apple Inc. or Hershey.
Imagine the strategic, five-year plan of the firm (the manufacturer you selected) includes an aggressive growth plan to build a new manufacturing plant that requires: (1) investment in land, buildings, facilities and equipment, (2) growth in productivity, and (3) growth in employment from 100 to 2,000 over the next five years. You have been assigned to evaluate the potential of locating the new plant in a country outside the U.S. The Country Listing document, which is posted with this assignment as a Student Material, includes a list of countries along with a list of students' names; for this assignment, you need to evaluate the country that appears in the same row as your name.
Please note: Locating facilities in foreign countries is referred to as offshoring.
Your report should include an introduction and a conclusion.
Use the bolded words shown below as first-level headings for your paper. Your 1,050-word paper should focus on the country where your selected firm will locate its new manufacturing operation and discuss the following:
• Productivity. Factors that determine the country's productivity that are listed in our course text and how the country's economic and social policies influence its productivity growth. Provide statistics and/or real-world examples related to those factors.
• Financial System and Economy. How the country's financial system, especially its central bank, monetary policies, and interest rates, affects gross domestic product, inflation, and unemployment. Be sure you discuss the level of current interest rates in your assigned country.
• Risks. How your firm can reduce the risks of locating a manufacturing operation in a foreign country.
• Availability of Labor. The current and projected unemployment/availability of labor in your assigned country over the next five years. Provide statistics related to unemployment/availability of labor. Hint: Population statistics are a good indicator of the availability of labor.
Cite a minimum of three peer-reviewed sources not including (Mankiw). Appropriate sources could include information from any government statistics-gathering agencies or economic development agencies in the country where you are considering locating the manufacturing facility as well as other creditable sources including the CIA's World Factbook and the Organizaiton for Economic Co-operation and Development.
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