The paper 'Corporate Social Responsibility Theory' is a perfect example of a Management Essay. Development is not an aspect of the economy that can stand on its own. It is dependent on several factors, both local and external. In the case of Norfolk Island, the self-governance system is an internal aspect of the economy that is playing a major role in pulling the island’ s economy into the mud. Like the former administrator of the island said, the self-governance system is ludicrous and ill-conceived (Brodtmann, 2015, p. 1). Any good governance system should put the welfare of its people first, something that the governance model on Norfolk Island has completely failed to do.
Since its conception about 30 years ago, Brodtmann (2015, p. 1) has expressed his lack of understanding of the relevance of the system. The system has failed to create job opportunities for its people, making several people migrate to the mainland in search of jobs. This is evident in the variations in population, where the island had a total population of 2302 in the year 2011 and the population had dropped to 1600 by 2015.
People are migrating in large numbers. The island depends on a shaky tourist industry, which seems to dwindle every year as the economic situation gets worse. This paper will analyze Norfolk Island’ s economic situation and its governance model using two global economic theories. Corporate Social Responsibility Theory The corporate social responsibility theory is based on how firms work with people and communities in society for the betterment of lives, environment, and other factors that support production. The Heckscher-Ohlin international trade theory is based on how services derived from factors of production that cannot be moved are produced, distributed, and sold.
It is founded on both theoretical and empirical frameworks. Factors of production cost are different and the more they are scarce, the higher price they are able to fetch. However, in certain cases, the element of factor-price may be eliminated so that the factors are not tied to prices. In such cases, factors become independent and free to be mobile, for those that are not fixed. This is the exact situation in Norfolk Island because the factors of production like labor and land are no longer valued.
Therefore, they become mobile to move in and out of the island. They move freely without hindrances especially that the island is a territory of Australia. Policies have been at the center of the dilution of the value of factors of production. The policies set by the administration have led to barriers to growth in the economy of the area. This, coupled with the lack of natural and other vital resources necessary for the growth and development of the economy has led to the continued deterioration of the economy.
Either way, the Australian government has decided to come in strongly and establish mechanisms that would stop the enforcement of laws that inhibit economic growth and expansion. It is believed that with such laws in place, the economy is likely to improve and see some good times. Regulation by the Australian government may come in many different forms. For instance, the government may decide to take control or to strongly influence the executive and legislative arms of the administration. Another way would be to control the financial systems of the territory.
According to De Serres (2006, p. 78), the stability of an economy is strongly linked to its financial system. Therefore, taking control of this system gives the controller a lot of power over the economy. The activities of the financial framework of any place encompass sensitive and vital activities, which are pivotal to the operations of the place.
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