¶ … features of the economies in the leading nations, those of the U.S.A., Japan, and Germany, have many essential features of their economies that are similar. Yet these countries also have many differences. By examining these similarities and differences as they relate to wages, benefits, productivity, and living standard, we can better understand each nation's economic practices.
One of the main features of any economy is the ability to obtain private ownership of the means of production, including land. This ability provides a competitive system of labor, which translates to higher wages, and more opportunity for a better standard of living ("Economics," Columbia University, 2002). In the United States, the means of production are generally privately owned, as they are in Great Britain. Conversely, though private production plays a major role in the economy of Japan, it has a centrally planned industrial policy in which bankers, industrialists, and labor unions meet and seek to agree to wage policies and interest rates. While the United States and Great Britain accept the free market economy, Japan rejects the idea of letting the market wholly determine the economy ("Capitalism," Columbia University, 2002).
A second key feature of the economic system is taxation. The United States has long had the lowest tax rates of any industrialized nation. Great Britain has the highest rate of the three countries, and Japan is slightly higher than the United States. Taxation is related to the standard of living. In the United States, while taxation is low, the government does intervene, with subsidies, tax credits, incentives, and other types of exemptions, as does Great Britain (Wolff, 1992).
Stemming from the taxation issue of the economy is the level to which the economy aids the population. In Great Britain and Japan, heath care has been nationalized. All people have equal opportunity to receive medial care, and preventative treatment. In the United States, however, health care, following suit to the rest of the economy, is based on the free market. It is not nationalized, but is a private network. Private health is dominated by insurance companies. In this way, the drive for benefits in the United States affects the overall productivity level, whereas Japan and Great Britain must rely on other tactics to ensure productivity ("Capitalism," Columbia University, 2002).
Another key feature of the economy is the formation of trade unions. Japanese unions are enterprise-based and thus represent firms to which they relate. In the United States, and Great Britain, unions at large are of industrial nature hence reflecting relevant industry. Unions in the United States and (to some extent) in Great Britain are mostly involved in business unionism: wage negotiations and other workplace matters are their main concerns. Japanese unions are contrasting in a sense that they are also mindful of improving general working environment and promoting industrial and economic democracy. Their activities are described as political unionism ("Labor," Columbia University, 2002). Competition is another key feature to the economies of these countries. Capitalism is grounded in the concept of free enterprise and competition, which argues that government intervention in the economy should be restricted and that a free market, based on supply and demand, will ultimately maximize consumer welfare. In the United States, competition in the workplace led to the abolishment of monopolies. In Japan, some forms of monopolies are still in place, thereby stifling competition, to some degree ("Capitalism," Columbia University, 2002).
There are some aspects of the three economies that are the same, however. Minimum wage laws ensure a minimum of living standards in all three economies. Wage and price controls help to curb inflation rates. Fair trade laws help to ensure that, at least to some degree, the labor market remains actively competitive, thus ensuring a market economy. While each country is different in their economic practices in some ways, each is based on the foundation of a capitalistic society.
Unions are considered to be associations of workers gathered for the purpose of improving their economic status and working conditions through collective bargaining with employers. Union membership allows people to have decent wages and working conditions and have a say in their jobs (AFL, 2002).
Unionism works due to a number of different strategies. One reason they work is because unions form a single unit of labor, rather than individual employees. Employees of a company can unite and organize as one to solve problems and gain protection against unfair treatment. Employers can no longer force a worker to do things outside of their regular positions, because the employee has the union to stand behind them. Organized workers have the power to resist anti-labor...
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