A riding outfit would consist of a gentleman’s or lady’s saddle bracket

Harness, to be kept clean and uninjured, should be placed in a room apart. In large stables where private carriage horses are kept the cleaning of leather, brass, and plate forms a considerable portion of a groom’s day duty, and so a room of size in proportion to the size of the stable is essential. The various brackets are made of malleable iron, which is japanned, galvanised, or enamelled, or may be capped with polished wood.

A riding outfit would consist of a gentleman’s or lady’s saddle bracket (Fig. 56), and of stirrup bracket, girth bracket, bridle bracket (Fig. 57). The whole set may be arranged one above the other, and would thus occupy a wall space of 7 feet 3 inches from floor by 2 feet wide.

Driving harness for a single horse is composed of pad, collar, rein, bridle, and crupper brackets, which may be arranged as shown in Fig. 58, the top bracket being fixed 8 feet from floor level ; and in the case of single harness 2 feet wide, and for double harness when the above brackets are duplicated 4 feet wide.

To better preserve harness from dust and damp, glazed cases can with advantage be used. The amount of harness to be put away will regulate their size. Bits and curbs are also placed in a glass case of their own.

Brackets or shelves should be provided for lamps, as also racks for forks and brooms carried by double hooks; and a cupboard for brushes, etc., is also necessary.

Whips may be carried on a circular wheel holder fixed to wall, or may simply be placed in a movable stand. Figs. 59 and 60 represent girth stretcher and saddle airer respectively, which are essential to a well ordered stable.

For cleaning purposes, hooks (Fig. 61) are fixed to ceiling, and are made telescopic and to revolve. Tables fitted with cupboards or drawers for the storage of rugs, saddle-cloths, etc., form part of the establishment, and can be made with saddle-shaped tops for cleaning harness. Such tops may be formed of folding flaps, which can fall to the sides or be folded flat and used as ordinary tables. In stables of small size the oats, wheat, etc., are kept in the stable in oak, wrought-iron, or galvanised iron bins.

Meters are useful when a check has to be kept on the supply which is fed from the loft above. A shaft for chopped hay, constructed of wood, may be also fixed in a suitable corner. Fig. 62 shows an arrange- ment which consists of a wooden shaft 3 by 2

feet or larger, the top of which may be level with floor of loft, or preferably be fed by a hopper. The food stuff then falls on to the planking fixed at a gentle slope, and passes to the other sloped boarding. Below this is a drawer which, when opened, has the food admitted into it by means of a vertically balanced shutter sliding up and down.

It is an advantage to place this feeding shoot in such a position that it will be possible to place the chaff cutter directly above the opening at top, so saving the intermediate handling.

Hayward Bros. & Eckstein, shows what is termed a ventilating guard

Hayward Bros. & Eckstein, shows what is termed a ventilating guard. This prevents the horse injuring himself, and at the same time avoids what, in the above- mentioned cases, is liable to become a receptacle for dust, etc.

Messrs. Musgrave & Co. have an arrangement made of iron (Fig. 48) which may be used for loose-box or stall, while it has the strength of an ordinary manger, and economises space. A water pot is shown recessed in the wall, the use of which is optional. If a hay-rack be made flush with manger it is wise to dispense with any iron rim at back or side, as this might annoy or even entrap the horse should he get his head sufficiently far down.

Messrs. Oates & Green manufacture mangers in salt glazed ware which recommend themselves on account of their cleanly and sanitary properties. They are made in what is called “ Nalethric “ fireclay, and are highly glazed ; they may be had in brown colour, cream, white, or light green, enamelled inside or outside.

Iron is used as brackets for fixing to the wall, and also for the hay-rack. Fig. 49 shows one of the mangers in section attached by means of wooden cleats, and built into the wall flush ; but many other means of fixing are adopted, such as by iron plates or bars or by a pillar support. The overall dimensions are 18 inches wide and 13 inches deep, length varying from 3 feet to 6 feet 6 inches.

Fig. 50 shows the general appearance of such a fireclay trough. This special one is made for a loose- box, and is fitted with lugs to fix into walls, instead of which they may be obtained with eyelet pieces to enable of their being bolted to wall.

For a loose-box which is convertible into two stalls, two manger sets should be provided, or a set with a centre and common hay division, as in Fig. 51.

To prevent crib-biting, Professor Varnel invented movable mangers such as that in Fig. 52, which close flush with wall. To accomplish this a space must be allowed at back of stall, which in the majority of cases would be inconvenient, except where a central feeding passage is used in the same way as used in cow-houses. Angle fittings are also made to close up flush, the inside of stall having to be fitted with a wooden shutter which covers up the manger opening.

The usual method of fastening a horse is from the centre of manger, but it may be accomplished equally well from one side or both, it being deemed advisable in some cases to tie the horse on both sides, so keeping him straighter, with less likelihood to disarrange his grooming before going out. The old method is to merely tie the horse to a ring, but some more suitable arrangement may easily be found. Fig. 53 shows a chain or leather strap which runs through a ring and over a pulley, and is attached to a weight which slides along a guide bar. This same principle as the above, but for cheaper stables, can be applied as in Fig. 54, where the ring slides up an inclined bar. In good stable fittings the weight and leather strap are enclosed in an iron casing and work perfectly noiselessly.

These loose-boxes form a range of their own

These loose-boxes form a range of their own, or are in conjunction with stalls. In the former case the doors would open in front of the box, and in the latter would probably be placed at an angle of 45 degrees, one of the angle posts thus serving the purpose of heel post to the stall division. A sick-box should, correctly speaking, have no connection with the stable, but should be kept apart, so as to give the occupant complete quietness ; and whenever possible it is desirable that this should be done.

A point to be considered in connection with loose boxes is the means of latching the door in such a manner that it will not open to any amount of “ nosing” from the horse inside, and yet may be easily worked by the attendant outside ; whilst at the same time,- like everything in the stable, it should give as little pro- jection as possible which would tend to injure or annoy the horse. Fig. 39 shows a latch made by the St. Pancras Ironwork Company, which appears to fulfil the conditions required, as it is perfectly flush when open ; but on the door closing the latch automatically enters the striking plate, and can only be opened by the handle on the outside.

Many devices have been designed for converting two stalls into a loose-box, and vice vcrsfl. They all leave something to be desired, but still are useful fittings where no loose-box is provided for, as is the case in many stable buildings. Fig. 40 shows various forms, firstly, where the heel post a is movable and the partition swings back against manger, thus forming a useless space. The partition b is a fixture with its post and door.

The ramp, or top iron bar of the stall division, may be of almost any shape or contour desired

The ramp, or top iron bar of the stall division, may be of almost any shape or contour desired, and is grooved to receive the boarding, if such be carried up to the top, or else to receive moulded iron bars or open grating. It should be at least 7 feet high at head, and may run horizontally to heel post, so obscuring one horse from another if the boarding is carried right to the top. The ramp may fall in a straight line, or curve in a sweep to some 4 feet or 4 feet 6 inches at the heel. At some 3 feet 9 inches to 4 feet 6 inches from the floor a middle rail may be inserted (see Figs. 35 and 36), and the space between this and top rail be filled up with some plain wrought-iron bars or with some cast- iron pattern. It is a matter of opinion whether the division at the head end of the stall should be left open or closed, many being of opinion that horses can eat more comfortably if not interrupted by seeing one another. It can be filled in with sheet iron if so desired.

A complete finish to the stable is obtained by fixing a half-post and lining against the wall which forms the side to the stalls at each end of the range.

The panelling itself should be of strong wood, such as oak or pitch-pine, and of ii, 2, or 2\ inches thickness, according to the strength of the horses to be provided

for. The generally accepted method is to fix the boarding vertically, but it is sometimes preferred that the boards should run horizontally, in which case they should be secured at head of stall into a channel iron made for the purpose. A strong form of division is one in which two layers of sheeting are used, laid vertically on one side and horizontally on the other.

The manure is removed from stables where horses or dairy cows

The manure is removed from stables where horses or dairy cows are kept and stacked in a heap, which should be covered and so protected from the rain whilst allowing a current of air to pass over it. The floor should be of good solid and smooth concrete, slightly sloped towards collecting grids, to which all the dark coloured manure liquid will find its way, and thence through pipes to a cistern to which is fixed a good-sized pump. Where cattle is kept for fattening purposes the manure is left to accumulate for several weeks before being removed ; in this case a great deal of the liquid becomes lost, and provision need not be made for its collection. There should be separate heaps for horses and cattle. Horses are housed in as comfortable a manner as possible, but the opinions of the owners are many and varied, and these should, above all things, be carefully studied. The loose-box of 12 by 12 feet or 12 by 10 feet is naturally the best way of housing a horse, but in most stables sufficient space is unobtainable, so stalls are provided instead; that is, spaces which should be 6 feet to 6 feet 6 inches wide (although many are put up as narrow as 5 feet 6 inches), and about 1 2 feet long to the gutter. Between each horse is placed a division. Iron is claimed to be the best and strongest material for the framework, but wood is preferred by many as being quite satisfactory and easily repaired in sittt, which is a great consideration in stables removed at a distance from any large town.

Stable floors have to be impervious, easily cleaned,

Stable floors have to be impervious, easily cleaned, not slippery, and such as will not require an over steep incline for drainage, and also of such a colour as will please and give the idea of warmth. When dealing with horse stables the part where most resistance is required is the floor of the stall, where the horse should stand as level as possible, and where ho can kick and paw without wearing away the paving.

The passage-way may be paved in some less resistant material, but, as a general rule, except where stables are built on the style of show places, the flooring is of

the same material throughout. Portland cement concrete of one part cement to six of gravel should first of all be laid to a depth of 6 inches and to the required falls. The finished floor may be of grooved cement, but it has a tendency to become slippery, and soon cracks beneath the continued pounding of a horse’s hoof. At A in Fig. 21 is shown a clinker brick of a dark yellow colour, 6 inches long, \\ inch wide, and 2 inches deep. It is made flat or with chamfered edges. For drainage purposes it should be so laid that the V-shaped groove formed by the bricks being laid side by side will conduct the urine in a straight course to the drain- age channel. For passage-ways the bricks may be laid herring-bone fashion. This is also generally done in the stalls, effectiveness of appearance being studied instead of utility. The blue Staffordshire bricks made in 2, 4, 6, or 8 panels, and 9 inches long by inches wide and 3 inches deep, give a most solid and

impervious floor. Their drawback may be considered to be the difficulty of properly draining or cleansing the chamfered channels, which continually cross one

another at right angles. However this may be, in some localities they are general favourites, and are extensively used. The St. Pancras Ironwork Company

have produced a paving brick of a blue-black or brown colour © which seems to meet a great many of the objections. The groove, semicircular in section, runs

in the middle of the brick, so removing any danger of leakage from a faulty or weak joint. This, like the clinker, may be laid so as to conduct the drainage

direct. It is claimed for these bricks that, on account of the mixture of clays of which they are composed, they will never wear smooth, but always give a firm foothold. The fall required is so slight that the difference of level on length of stall need only be of 2 inches. Paving may be composed of bricks on end, but these wear out easily ; or of granite cubes or rectangular blocks with roughened surface. They are apt to become slippery, and then require to be repicked. In granite districts they are extensively used, and are found to answer satisfactorily.

Boarding houses lie midway between private houses and hotels

Boarding houses lie midway between private houses and hotels, and so may perhaps be best considered in this chapter ; an example being illustrated in Fig. 19, which represents the Eversleigh Boarding House or Private Hotel, at Seaford, designed by Mr. J. W. B. Blackman. Intended for erection on a sea frontage, the rooms are naturally arranged with a large amount of window space, and on the upper floors with balconies. The ground floor is a somewhat curious combination of hotel and private house, with an office close to the entrance and a smoking-room carefully arranged in an almost detached position. The kitchens are large and give ready access both to entrance and to dining-room, while the bedrooms on the upper floors are so arranged as to be let out either singly or in groups for families.

On the top floor the division is carried so far that bedroom No. 18, intended for the proprietor, has doors opening on to two corridors, one apportioned

to guests and the other reserved entirely for the servants. this may be done, it is necessary to provide some means by which the impure air may find its passage out. A foul-air shaft, taken from the ceiling to a ventilator of some description at ridge level, will

afford the necessary means of exit. One or more shafts may be used according to the size of the stable, but they should be taken from as central a position as possible, although, for economy of space in the usual loft above, it is found oftentimes convenient to place

the grating in a corner of the stable and to carry the shaft in line with the rafter. At the same time, it would appear wise to secure the best means of ventilation, even though it may mean some slight inconvenience. A fixed iron grating may be placed

at the mouth of shaft, or else it may be covered with mesh wire or perforated zinc and have a wood door fixed in grooves, sliding so as to leave ventilator

closed or open at will, and controlled by a rope and pull carried over a pulley and fixed at a convenient place. This is shown in Fig. 20, and is a very usual arrangement, but any other of the many systems of ventilation already described in full in Volume III. may be adopted.

additional conveniences of large lounges and halls

It will be noticed that, except that this is on a larger scale and for a different class of customer, there is much the same tendency to provide for non-resident lunchers and diners as there is in the larger city public-houses, and similarly the rooms are all of considerable size and luxuriously appointed, with the additional conveniences of large lounges and halls, more exclusively for the use of residents.

the first-floor plan, which it will be seen is more completely that of a residential hotel. The Regent Street frontage is even here occupied by the upper storeys of shops, but the Piccadilly and Vine Street frontages are given up to suites of rooms, generally arranged so that they can be let off in pairs or groups, a sitting-room and bedroom being usually grouped together, it being always possible to open communicating doors if desired. These suites are complete, each sitting-room and bedroom being pro- vided with separate cupboards and separate bathrooms, all properly lighted from the exterior, while the bed- rooms have standing washing basins. These rooms, occupying the exterior of the site, are all reached by internal corridors, which are lighted from large wells which also provide top light to the dining-room on the ground floor. The Air Street frontage is given up to drawing and reading-rooms, while the interior is devoted to hotel dining and coffee-rooms, served mainly from the kitchens on the lower floors, and having here only a service kitchen communicating by means of lifts with those below. There are also several service lobbies, pantries, etc., the general idea being to obtain ample internal communication, by means of which the servants can easily reach all parts without unnecessary interfering with the guests.

The same tendency to provide suites rather than single bedrooms is to be seen in the upper floors, of which that shown in Fig. 18 may be taken as a type. In many cases it would be possible here to provide groups of three or four, or even as many as six rooms, which would practically be independent residences within the great hotel, showing in a striking fashion the tendency at the present day to follow the American manner of hotel rather than home living. This floor is planned on the direct central corridor system, with two such corridors radiating from the main staircase, while the lift service is remarkable for its completeness.

Similarly, the way in which all parts can be reached by the servants from the back entry from Vine Street, by means of the stair which runs up and down from the goods entrance shown in that position in Fig. 15, is worth noticing. On these upper floors, by means of enlarging the areas, it has been possible to obtain external lighting to all the rooms, though the corridors will to a certain extent have to depend on electricity even here. There are no great general reception-rooms, and the need for them scarcely exists so much in a hotel of this character as it does where the guests are provided only with private bedrooms and not with private sitting-rooms also. This is an American idea rather than an English one, but it appears to be becoming general, and doubtless future hotels of the larger character erected here will be upon this system, unless it be found to pay better to provide somewhat large bedrooms which can be utilised for sitting-room purposes also, as is commonly done upon the continent. There is no stinting of room, but plenty of space is given to provide comfortable and even luxurious apartments for which a high rent can be charged.

The first floor is given up entirely to a large grill and dining-room

The first floor is given up entirely to a large grill and dining-room, which occupies the whole of one frontage and would be used principally by lunchers and diners, and to a coffee-room for the service of meals for those using the place as an hotel, there being a combined servery and still-room for supply- ing each of these, the former across the landing of the back stairs, and the latter through a servery hatch. The main staircase does not proceed above this floor, where it is replaced by a more private inner stair for hotel use, leading up to the second floor, on which is a smoking lounge for hotel residents as well as a number of bedrooms and a rather curiously placed bathroom. On the second floor the back stairs are changed in position on account of a certain portion not being carried up farther. The third floor is almost identical, the smoking lounge being replaced by an additional bedroom, and the hotel staircase going up no farther. The method of lighting this staircase does not appear on the illustrated plans, but would be seen if the third-floor plan were illustrated. There is a good deal of heavy brickwork on these upper floors, particularly in the chimneys, which has to be carried by girders, but this presents no difficulty if modern steel construction be adopted. The chimneys are generally arranged so as to group the flues and to permit of beds being placed comfortably in the rooms.

There are yet two more storeys, the fourth and fifth, and the kitchens occur on the fourth floor, being served for most purposes by the large lifts, while themselves serving the various dining-rooms and bars by means of the smaller lifts. The large lift is carried right from bottom to top of the building from sub-basement to the fifth floor ; while the smaller lifts commence on the ground-floor level and go up to the fourth floor only. A large storeroom is interposed between the kitchen and the staircase corridor, a scullery also serving somewhat in the same way to cut off the smell of the cooking from the bedrooms on this floor. At this level the angle takes a circular form, which is more emphasised again on the fifth floor, where the circle is complete, the room being used as a sleeping place for bar attendants ; for this top floor is naturally given up to the staff bedrooms and to a large larder above the kitchen a most sensible and airy position for such a room, where it would be possible to ventilate it thoroughly.

KLM Captain to assume that the word ‘Okay’ was the complete message

It seems likely that this caused

the KLM Captain to assume that the word ‘Okay’ was the complete message. In any

event the KLM Captain then took off and collided with the Pan-Am Jumbo killing a total

of 573 people. The investigators commissioned by the American Airline Pilots

Association concluded that this was the most likely explanation of events. They also

commented on the ambiguous use of the term ‘take-off’. Their comments on the use of

the telm ‘Okay’ were as follows:

The word (or letters) ‘O.K.’ can be ambiguous also: to the controller it was either a word

of acknowledgement or a delaying term to allow a moment to think. It can also mean a

host of other things, such as a state of well being, a check off of a task accomplished, or

a statement of approval. It could have had the latter meaning for the KLM crew.

Cultural differences can obviously present barriers to effective communication as well.

Some of the cultural barriers-such as language-are obvious but there may be more

hidden obstacles. A recent example given to me which illustrates this point concerned

the communication between the male Asian workers and the female canteen workers in

a London factory.

be reluctant to admit that he cannot understand the language

The person receiving the explanation may also,

understandably, be reluctant to admit that he cannot understand the language that is

used. The skill is in recognising that, even when ordinary English is used, there may. be

problems of comprehension. The initiator of any cQmmunication needs to get positive

confirmation that the ‘language’ he is using is one that can be understood.

In identifying the appropriate’ language’ for communication, attention needs to be given

to the possibility of ambiguity. The more important the consequences of error, the more

attention needs to be devoted to avoiding ambiguity. If stress is needed on this point, it

can be provided by the ambiguous use of words which contributed to the world’s worst

air disaster at Tenerife in the Canary Islands in 1977. The pilot of a KLM Jumbo Jet, who

was ironically. also the head of their Flight Training Department, was preparing to take

off at Tenerife. He explained that he was ready to the air traffic controllers and in

response was told “Okay. Stand by for take-off I will call you”. In the pause after the world

“Okay” there was radio interference because of a radio query by the Captain .of a

Pan-Am Jumbo about the intentions of the KLM Captain

Choice of language

Language difficulties can obviously hamper communication between people who have

different national languages. Regional dialects can also, and predictably, complicate

matters. However, there can be many other and more subtle language problems even

between people who are from the same country’, region and class. Technical language

may be used. in discussion which is beyond the comprehension of some of the

participants. In any organisation there are likely to be abbreviations, words with special

connotations, and ‘in-terms’ whose meaning is

taken for granted by those inside the organisation. A

colleague of mine recently gave an example of two nurses trying to communicate about

sterilisation policies in their respective parts of the Health Service. One was a midwife

and the other a community nurse. It took a quarter of an hour before they realised that

one was talking about sterilisation as a means of. birth control and the other about

sterilisation as a means of protecting babies from infection! Problems of language

invariably get exposed in the rectangles drawing exercise previously explained. The

diagram may be explained by the use of geometric language, points of the compass, the

hands of a clock or the use of symbols such as ‘L shaped’ and ‘an inverted V’. The

language chosen by the instructor is likely to be more convenient to some people than

others and a person’s ability to understand the instructor will in part depend on whether

the instructor chooses a language convenient to him or not

The recurring problem with language in communication is that the person who is trying to

explain something may understandably use the language that is most convenient to

himself without perhaps realising that

there. is a choice of language.

The choice of time and place

The choice of time and place to invite people to talk can be critical, Just as one knows

oneself that there are times when one is prepared to open up, and times when one is

not, so this can obviously be the case with other people. One of the skills of

communication is picking up the cues as to whether a person \s or is not prepaI’ed to

talk about a sensitive matter. Even if the place cannot always be chosen, sometimes the

geography of a room can be arranged to encourage, or for that matter to discourage, a

person from talking. The more status symbols surrounding the authority figure, the less

likely a subordinate is to feel free to talk. One remember one personnel officer who was

over six feet tall always made a point of seeing that he had an able but peppery works

superintendent who was short were both seated if anything of consequence was to be

discussed. The personnel officer had learned from experience that the superintendent

was self-conscious about his lack of height and so he did his best not to emphasise it.

Listening effectively

Listening effectively

Adopting a listening role can be far harder than taking the lead by talking. The problem

with this can be that, the more the authority figure talks, the less the other person may be

inclined to talk. There can be a critical moment when people in the subordinate role

might just start saying what they really feel, if only the authority figure stays quiet long

enough. Once the ‘subordinate’ has started talking, things may come out with a rush and

to the amazement of the authority figure. One have often found that such a critical

moment can occur when one leading classroom discussions.. One useful technique in

any such situation can be to count silently to five before breaking the silence after a

particularly important question has been asked. Time after time one have found that

such a delay has resulted in someone making a contribution that one had not thought

possible. Once a person has started to talk it can be relatively easy to get him to

continue and for any others to join in. The problem is likely to be how to get them started.

The authority figure needs to be aware of letting his ignorance, impatience or even his

own

nelVousness prevent such a process staI1ing. Care has to be taken with the timing of

invitations for people to open up-it is not only the time and the place that can be

important but also the stage in a discussion.

The skills of effective communication

Much of the skill in effective communication lies in recognising the problem areas one

have just identified. Effective communication is achieved as much as anything by

avoiding these traps. Positive approaches are, however, also necessary. One positive

approach is that of coaxing information out of people.

Coaxing information

It may be necessary for managers to work hard at this, particularly if people feel inhibited

about discussing a particular issue. The lament ‘why didn’t someone tell me’ can be as

much a condemnation of a manager’s lack of skill in developing effective channels of

communication as a condemnation of others for keeping him in the dark. It can be very

hard for those in authority roles to realise the difficulty that others may have in

communicating with

them. The authority figure may feel totally relaxed and uninhibited and not appreciate that

perhaps the very factors which create his security create difficulties for others. The

proprietor of a business may feel totally self¬confident and secure and be amazed to

find out, if he ever does, that people who are very dependent on him are reluctant to tell

him anything unpleasant. The same problem can be encountered by parents with their

children. They may forget what it was like to be a child and be blissfully unaware of many

of the thoughts and anxieties that their own children have and see any suggestion to the

contrary as quite preposterous.

As well as having to cope with one’s own subjectivity,

As well as having to cope with one’s own subjectivity, it must also be recognised that

much of the data which is available within organisations is subjective or actually

misleading. Most people working in organisations are likely to be concerned with the

pursuit of truth, but people in organisations, as in life generally, are under a valiety of

pressures to highlight some things and not others. There are also pressures to view

events in a particular way. This means that a manager, as well as being aware of the

pressures on him to see things in a

‘particular way, and to report selectively, needs to evaluate carefully the information that

is being fed to him. One of the themes of the TV comedy series Yes Minister is that

information is fed to the Cabinet Minister by his Permanent Secretary in such a way that

the Minister thinks that he is taking the decisions himself. One strategem is that the

options are put so that the Minister is bound to choose the one preferred by his

Permanent Secretary. It is also necessary to be careful to evaluate the information that

this fed down the line. For example, one

have found. that if one examines carefully the policy decisions that are actually taken by

their own Local Education Authority, they bear little relationship to many of the

interpretations that work their way down the structure to individual College departments..

Selective reporting and misunderstanding are not phenomena confined to upward

reporting. COlToboration of the existence and nature of these problems is given by a

former civil servant, John Carswell, in a Sunday Times article.

In one experiment conducted with Amelican students

The extent to which people can .be misled or even coerced into believing things which

are untrue can be alarming. In one experiment conducted with Amelican students it was found that a

quarter could be coerced into stating that straight lines were of identical length when one

was 25 per cent shorter than the other. This effect was achieved by priming the seven

students in the expelimental group to say that the lines were identical in length. One must

be careful not to overgeneralise about the amount of social coercion possible from the

results of a series of experiments in America with a particular group and at a particular

time. However, if social pressure can have this effect on such obvious matters of fact,

what is the scope for social pressure on matters that are more subjective or where

people’s self-interest is involved?

Selective perception and bias

In considering barriers to communication, it is also necessary to deal specifically with

the problems caused by selective perception and bias. The sheer volume of data thai is

available means that one has to have some basis for deciding what to look for and what

to react to. However, careful judgment is needed in making these decisions.

A totally open mind can simply mean that a person is swamped with data but a closed

mind can mean that a person doesn’t respond to what is uner his nose. Particular

dangers are seeing only what you want to see, ng the ‘facts’ fit what has already been

· decided, and suppressing unpleasant facts. Norman Dixon,. a formr Army psychiatrist,

·

explains a number of Western military disasters in terms of such selective perception on

the- part of the military leaders concerned, in his book On the Psychology of Military

Incompetence. Three of the many examples the documents concern the Japanese

attack on Pearl Harbor, the fall of Singapore and the failure of the Amhem offensive in

Holland. The pattern according to Dixon is clear and recurrent-the warning signs were

there but, because they did not fit into the established thinking, they were ignored until

too late.

Write a note on Externalities

Externalities:

Externalities (Spillover effects)- are common virtually every area of economic activity. Externalities occur when firm of people impose costs or benefits outside the market place. External cost are said to be the negative externals cost and benefits together are called Externalities. External cost are said to be the negative externalities and external benefits are said to be positive externalities. External cost is uncompensated cost an individual or the firm imposes on the other, the best example for external cost or negative externalities is the environment cos of the pollution. The external benefits are the benefits the individual of firm gives to others without receiving and compensation in returns, the best example for positive externality or external benefits is the national defense provided to protect the freedom of everyone., even if one wants or not irrespective of whether one is paying for it or not and commodity available from public distribution system. The government should be more concerned about the negative externalities. They are defined as third party effects arising from production and / or consumption of goods and services for which no appropriate compensation is paid. The study of externalities by economists has been more in the recent years after the link between the economy and environment became strong.

Externalities create divergence between private and social cost. Eg. costs of pollution is not included in the cost of production of the factory, which is creating the pollution; but it is included in the social cost as the community has to bear the cost in some way or the other. Thus the social cost in this case is greater than the private cost.

Social cost= private cost +private cost

A chemical factory throwing out a lots of chemical waste in the nearby river killing the fish and making the water unhealthy for use, refineries pullulating the air and paint industry creating bed odour, creating respiratory track infections and other diseases to all the people living in the area around the factories. These negative externalities will increase the social cost as the cost on the clean up and health will increase. External cost due to traffic jams, an individual deciding to go for a drive in the peak hours and increasing the travel time of the other drivers are all negative externalities.

Define Business Cycle. Elucidate characteristics and phases of Business Cycle .

Business cycle:

Business cycle is also called Trade Cycle. The business is never steady. There are always ups and downs in economic activity. This cyclical movement both upwards and downwards iswcommonly called Trade Cycle. This is a wave like movement in regular manner in business cycle. In business, there are flourishing activities, which take economy to prosperity and growth whereas there are periods when there is recession, which leads to decline in the employment, income and output. When the economy goes into downswing then there is a stage of recovery to reach a new boom.

Definition and Characteristics of Business Cycle:

Keynes : Trade Cycle is composed of periods of good trade characterized by rising price and low unemployment percentage altering with periods of bad trade characterized by falling price and high unemployment percentage. To put in simple words:-

Business cycle is a fluctuation of the economy characterized by periods of prosperity followed by periods of depression.

Definition and Characteristics of Business Cycle:

· The fluctuation are wave like movement and are recurrent in nature.

· Business cycle is characterized by waves of expansion and contraction. But these are not only two phased of business cycle. There are four phases of business cycle.

o Expansion

o Recession

o Contraction and

o Revival or Recovery

· The movement from peak to trough and again trough to peak is not symmetrical. According to Keyness, prosperity phases of business cycle comes to end fast but dip is gradual and slow.

· Business Cycle is self generating. Every phase has germs of the next phase, that is, expansion has the germs of the recession in it.

The Business cycle or Economic cycle refers to the fluctuations of economic activity about its long term growth trend. The cycle involves shifts over time between periods of relatively rapid growth of output (recovery and prosperity), and periods of relative stagnation or decline (contraction or recession). These fluctuations are often measured using the real gross domestic product. Despite being named cycles, these fluctuations in economic growth and decline do not follow a purely mechanical or predictable periodic pattern.

Elaborate on Monetary Policy

Monetary policy is the process by which the government, central bank, or monetary authority manages the supply of money, or trading in foreign exchange markets.^[1] Monetary theory provides insight into how to craft optimal monetary policy.

Monetary policy is generally referred to as either being an expansionary policy, or a contractionary policy, where an expansionary policy increases the total supply of money in the economy, and a contractionary policy decreases the total money supply. Expansionary policy is traditionally used to combat unemployment in a recession by lowering interest rates, while contractionary policy has the goal of raising interest rates to combat inflation (or cool an otherwise overheated economy). Monetary policy should be contrasted with fiscal policy, which refers to government borrowing, spending and taxation.

Types of monetary policy

In practice all types of monetary policy involve modifying the amount of base currency (M0) in circulation. This process of changing the liquidity of base currency through the open sales and purchases of (government-issued) debt and credit instruments is called open market operations.

Constant market transactions by the monetary authority modify the supply of currency and this impacts other market variables such as short term interest rates and the exchange rate.

The distinction between the various types of monetary policy lies primarily with the set of instruments and target variables that are used by the monetary authority to achieve their goals.

Monetary Policy:	Target Market Variable:	Long Term Objective:
Inflation Targeting	Interest rate on overnight debt	A given rate of change in the CPI
Price Level Targeting	Interest rate on overnight debt	A specific CPI number
Monetary Aggregates	The growth in money supply	A given rate of change in the CPI
Fixed Exchange Rate	The spot price of the currency	The spot price of the currency
Gold Standard	The spot price of gold	Low inflation as measured by the gold price
Mixed Policy	Usually interest rates	Usually unemployment + CPI change

The different types of policy are also called monetary regimes, in parallel to exchange rate regimes. A fixed exchange rate is also an exchange rate regime; The Gold standard results in a relatively fixed regime towards the currency of other countries on the gold standard and a floating regime towards those that are not. Targeting inflation, the price level or other monetary aggregates implies floating exchange rate unless the management of the relevant foreign currencies is tracking the exact same variables (such as a harmonised consumer price index).

Inflation targeting:

Under this policy approach the target is to keep inflation, under a particular definition such as Consumer Price Index, within a desired range.

The inflation target is achieved through periodic adjustments to the Central Bank interest rate target. The interest rate used is generally the interbank rate at which banks lend to each other overnight for cash flow purposes. Depending on the country this particular interest rate might be called the cash rate or something similar.

The interest rate target is maintained for a specific duration using open market operations. Typically the duration that the interest rate target is kept constant will vary between months and years. This interest rate target is usually reviewed on a monthly or quarterly basis by a policy committee.

Changes to the interest rate target are done in response to various market indicators in an attempt to forecast economic trends and in so doing keep the market on track towards achieving the defined inflation target.

This monetary policy approach was pioneered in New Zealand. It is currently used in the Eurozone, Australia, Canada, New Zealand, Norway, Poland, Sweden, South Africa, Turkey, and the United Kingdom.

Price level targeting:

Price level targeting is similar to inflation targeting except that CPI growth in one year is offset in subsequent years such that over time the price level on aggregate does not move.

Something akin to price level targeting was tried in the 1930s by Sweden, and seems to have contributed to the relatively good performance of the Swedish economy during the Great Depression. As of 2004, no country operates monetary policy based on a price level target.

Monetary aggregates:

In the 1980s several countries used an approach based on a constant growth in the money supply. This approach was refined to include different classes of money and credit (M0, M1 etc). In the USA this approach to monetary policy was discontinued with the selection of Alan Greenspan as Fed Chairman.

This approach is also sometimes called monetarism.

Whilst most monetary policy focuses on a price signal of one form or another this approach is focused on monetary quantities.

This policy is based on maintaining a fixed exchange rate with a foreign currency. There are varying degrees of fixed exchange rates, which can be ranked in relation to how rigid the fixed exchange rate is with the anchor nation.

Under a system of fiat fixed rates, the local government or monetary authority declares a fixed exchange rate but does not actively buy or sell currency to maintain the rate. Instead, the rate is enforced by non-convertibility measures (e.g. capital controls, import/export licenses, etc.). In this case there is a black market exchange rate where the currency trades at its market/unofficial rate.

Under a system of fixed-convertibility, currency is bought and sold by the central bank or monetary authority on a daily basis to achieve the target exchange rate. This target rate may be a fixed level or a fixed band within which the exchange rate may fluctuate until the monetary authority intervenes to buy or sell as necessary to maintain the exchange rate within the band. (In this case, the fixed exchange rate with a fixed level can be seen as a special case of the fixed exchange rate with bands where the bands are set to zero.)

Under a system of fixed exchange rates maintained by a currency board every unit of local currency must be backed by a unit of foreign currency (correcting for the exchange rate). This ensures that the local monetary base does not inflate without being backed by hard currency and eliminates any worries about a run on the local currency by those wishing to convert the local currency to the hard (anchor) currency.

Under dollarisation, foreign currency (usually the US dollar, hence the term "dollarisation") is used freely as the medium of exchange either exclusively or in parallel with local currency. This outcome can come about because the local population has lost all faith in the local currency, or it may also be a policy of the government (usually to reign in inflation and import credible monetary policy).

These policies often abdicate monetary policy to the foreign monetary authority or government as monetary policy in the pegging nation must align withe monetary policy in the anchor nation to maintain the exchange rate. The degree to which local monetary policy becomes dependent on the anchor nation depends on factors such as capital mobility, openness, credit channels and other economic factors.

Managed Float:

Officially, the Indian Rupee (INR) exchange rate is supposed to be 'market determined'. In reality, the Reserve Bank of India (RBI) trades actively on the INR/USD with the purpose of controlling the volatility of the Rupee - US Dollar exchange rate - within a narrow bandwidth. ( i.e pegs it to the US Dollar )

Other rates - like the INR/Pound or the INR/JPY - have volatilities which reflect the volatilities of the US/Pound and the US/JPY respectively.

The pegged exchange rate is accompanied by an elaborate system of capital controls.

- On the current account, there are no currency conversion restrictions hindering buying or selling foreign exchange (though trade barriers do exist).

- On the capital account, "foreign institutional investors" have convertibility to bring money in and out of the country and buy securities (subject to an elaborate maze of quantitative restrictions).

- Local firms are able to take capital out of the country in order to expand globally.

- Local households have quantitative restrictions( which are being relaxed in recent times) in their ability to do global diversification . ( example while local firms can buy real estate - individuals may not). However they are able to purchase items ( mainly consumer items - say a laptop) and services reasonably freely ( there are quantitative restrictions ). Most of these transactions happen through credit cards through the internet.

Owing to an enormous expansion of the current account and the capital account, India is increasingly moving into de facto convertibility. However - it still cannot be considered a fully convertible currency.

The INR is not a highly traded currency - beyond India. It is traded by way of Forwards through inter bank transactions. ( again the US Dollar exchange rate determines the INR / other Crosses exchange rate )

As any currency traded in the international market - the INR does trade at a market determined premium / discount for the forward months.

Gold standard:

The gold standard is a system in which the price of the national currency as measured in units of gold bars and is kept constant by the daily buying and selling of base currency to other countries and nationnals. (i.e. open market operations, cf. above). The selling of gold is very important for economic growth and stability.

The gold standard might be regarded as a special case of the "Fixed Exchange Rate" policy. And the gold price might be regarded as a special type of "Commodity Price Index".

Today this type of monetary policy is not used anywhere in the world, although a form of gold standard was used widely across the world prior to 1971. For details see the Bretton Woods system. Its major advantages were simplicity and transparency.

Mixed policy:

In practice a mixed policy approach is most like "inflation targeting". However some consideration is also given to other goals such as economic growth, unemployment and asset bubbles.

This type of policy was used by the Federal Reserve in 1998.

Write a note on Consumption Function

There are two group of factor that affect consumption function:

1. Subjective of internal factor:

These are related to psychological characteristics of human wants. These factors change more in long run rather than short run. These factors are:

a. Precaution motive:

every individual has a strong feeling to prepare for unseen emergencies like sickness, accident, unemployment etc. so they build up reserves for such emergencies

b. Foresight motive:

Every man has future needs. They need to save for old age, educational needs of children, marriage of daughters etc.

c. Motive for independence:

Most of us have a strong desire to be independent financially. So we tend to save by sacrificing present consumption.

2. Objective or External factors:

a. Distribution of income:

This is an important factor of propensity to consume. The more inequality in income distribution, the lower will be the propensity to consume. Equal distribution of income increases the propensity to consume. Poor people have higher MPC, as their basic or primary needs are not satisfied. So, increase in income tends to increase MPC, whereas rich people have lower MPC.

b. Fiscal Policies:

Fiscal policy is related to tax structure and government expenditure. When the taxes are decreased the disposable income with people will increase and so will the consumption and vice versa.

Consumption means: Consumption means using goods for services for satisfying current wants. We spend major portion of our income on consumption. Consumption expenditure means house hold spending. Which satisfies our immediate wants. Under this section, we will study the relationship between consumption and income. The pattern of consumption expenditure for all families is more or less the same. We can see that families have tendencies to increase consumption with increase in income. This relationship between consumption and income is called consumption function. Consumption is a function of income.

C = f(Y)

C – consumption

F – function

Y - income

Consumption function is expressed as a linear function of income.

Explain the basic concepts of Macro Economics

Basic Concepts of Macro Economics:

Let us introduce ourselves with the basics concepts of Macro Economics, which are important in business management:

1. Stock and Flows:

Stock is always measured at a given point of time and flow is measured over a given period of time. Macro Stock Variables are inventory, capital stock, wealth, debits etc. Macro flow variables are National income and output, consumption, investment etc. Both stock and flow are expressed in money units. Stock may be expressed as just rupee but flows are expressed as rupees per month, rupees per year or in any time unit. The distinction between the stock and flow can be cleared with an example. Total money supply is stock but change in money supply is flow.

2. Capital and Investment:

Capital is always measured at a point of time, which investment is the change in the capital stock over a period of time. Many times investment and capital formation are used synonymously.

3. Ex-Post and Ex-ante:

These are Latin phrases, which means before hand and afterwards. Ex-ante means anything planned and intended. For Eg., Ex-ante saving is an amount that the people intend to save out of their income. Ex-post is realized saving, investment etc. For Eg. Ex-Post saving is the amount that the people actually save in that period.

4. Equilibrium:

Equilibrium is defined in economics as the position of rest or a state of balance or a state where there is no change required in a period of time. Equilibrium is absence of disequilibrium. Economics deals with variables, whose value changes over a period of time.

Interpret the concept of Consumer Surplus

The concept of consumer surplus is based on demand theory by Marshall According to Marshall, consumer surplus is a part of the benefit, which a person derives from his environment of conjuncture. The price, which a person pays for a product is always less than what he is willing to pay for it. The differences between the amount the consumer is willing to pay and what he actually pays leads to satisfaction which is consumer surplus. Let us illustrate this with as example. If a consumer is willing to pay Rs. 5/- for one orange and the actual price is Rs. 3/- , then the consumer surplus is Rs. 2/-.

In this diagram, the DD1 is the curve for a commodity. If OP1 is the price then the quantity demanded is OQ1. the consumer surplus is P1R1D, (Q1R1D- OP1R1Q1 = P1R1D).

Operational significance of Consumer Surplus:

Consumer surplus concept has many uses and significances. We will discuss the application of consumer surplus under the following divisions:

1. Cost benefit Analysis

2. Evaluation loss and benefit due to tax

3. Gains from Subsidies

1. Cost benefit Analysis:

Cost Benefit analysis is done for the public investment projects. This is used to judge the desirability of public investment of any public projects or investment. In this, we don’t analyze the money cost and money benefit; but real cost and real benefit. Here it is concerned with social benefit and social cost. Cost benefit analysis is done for the public projects to analyze the social benefits from the public investment