Rent and Urban Economics Essay Example | Topics and Well Written Essays - 1500 words

Rent and Urban Economics - Essay Example According to this theory, there are factors which constitute the differences in locations and it includes localized materials, amenities and transport cost (Answers.com). Von Thnen posits that transportation costs constitutes or consumes Ricardo's economic rent that's why "because these transportation costs and, of course, economic rents, vary across goods, different land uses and use intensities will result with distance from the marketplace". In the table we observed differences in rates across the different locations. The theory suggests that part of this difference is accrued to the transportation cost. Real Estates including residential areas near the industrial and commercial districts are priced higher than those which are farther. This is explained by the differences in transportation cost as the former requiring minimal time, effort and financial costs in travelling. We expect that the commercial districts house the necessaries that consumers usually go to such as the office, schools, groceries, malls, shops and others. In this theory, the West End is obviously in the advantage against the City, making its rent prices higher. The difference in prices is necessary as can be explained by the simple law of supply and demand. If the rent prices are the same with the West End and the City, there will be shortage of space in the West End resulting to overcrowding while none will stay in the City. In the presence of excess demand, the owners of land will be able to increase the price, thereby creating a disparity between the West End and the City price. Simply put, the law of demand will work for the land owners, maintaining the price differences between the two locations. Amenities are also better in the West End than the City. Being the centre of industry and commerce, amenities will be located in the cities making it more attractive and nearer to residence in the West End. This adds convenience to those who are in this place, thus it has to be compensated by a higher price. Von Thnen also mentioned the difference in land use and intensity causing differences in prices (Wikimedia Foundation, Inc.). Since the land in the West end is mainly used for commercial purposes, where tenants expect a higher return than in the City, land prices can be increased. Von Thnen also mentioned the importance of centrality in pricing, saying that "it was density of population increasing the profitability of commerce and providing for the division and specialization of labour that commanded higher municipal rents" (Wikimedia Foundation, Inc.) FLUCTUATING RENTAL RATES The simple law of supply and demand can be used to explain cyclical pattern in rents. Both locations, the City and the West End show fluctuation in rental rates. Some empirical studies have identified reasons for this. We are going to study each factor and relate it to existing economic theories. It has been found that employment growth account for the fluctuations in rental rate (Robert H. Edelstein). Accordingly, employment growth affects per capita income in a positive direction. With income being a determinant of demand, high employment growth will cause high demand for housing and land. With the increased capacity to purchase, over-all demand for space will be increased thereby increasing the prices of houses, offices and lands. This is observed at the time in 1973 and 1974, in 1987-1990, 2000-20001, and 2007-2008 in

Working internationally Essay Example | Topics and Well Written Essays - 2000 words

Working internationally - Essay Example Price fluctuations are usually reduced through purchases of both long term and short term positions within the same securities. Hedge funds differ form other types of careers on the financial sector because of the nature of business. Hedge funds are not as regulated as other investment or financial institutions. Consequently, most of them may not be as well structured as the other conventional investment institutions. Hedge funds are usually centred on the hedge fund manager. This is the person who will conduct most transactions; he may be in charge of marketing, human resource, operations and many others. (Alec, 2007) However, it should be noted that in larger hedge funds, there is more division of labour as there may be operational managers and others. Even the manners of conducting business within these hedge funds will depend upon the type of organisation chosen. Therefore employees are expected to be versatile. In order to make it in the fast paced yet exiting career in hedge funding investment, one needs to be well versed with the tricks of the trade. This can only be attained through work experience. Currently, the work experience was obtained through internship at a small hedge fund company at the heart of the City. The work experience was an enriching achievement. This is because there was an opportunity to learn first hand how hedge fund companies are run. The atmosphere was extremely busy since members of staff were not too many yet the tasks at hand were quite enormous. The environment was quite stimulating because there were instances when efforts would be rewarded there and then. However, there were also some times when it would be bitterly disappointing. It was also established that the hedge fund sector requires a lot of networking. Most of the prominent personalities in the firm were deeply engaged in the hedge fund business. They had started out as graduates but made efforts to link themselves to all the right groups