UGC NET/JRF EXAM, December-2019* Labour and Social Welfare

Qualitative Forecasting Methods

Qualitative forecasting methods use personal judgments in making predictions. Some types of judgmental forecasting are surveys, Delphi technique, and the nominal group method.

Surveys can be conducted by polling various individuals, such as managers, for their opinions of their estimates of projected needs for human resources. Managers' opinions can be obtained for different scenarios that have different probabilities of occurring in the future.

The Delphi technique involves a panel of experts who independently review a number of subjects and estimate the likelihood of events occurring, such as the number of human resources that may be required in the future if a particular event occurs.

Typically, the results of the panel members' initial estimations are summarized and the feedback returned to the members to make further estimates. The nominal group method is a technique used in forecasting events, such as the demand for human resources, that involves a group of people who give their ideas on a subject.

The persons typically are seated at a table. A subject is introduced, and the persons are asked to contribute their ideas about the subject. Each person, in turn, either makes a contribution or says "I pass." After two rounds of "I pass" by all participants, ideas on the subject are assumed to be exhausted.

Dunning's eclectic theory (1985), known as the "transaction cost theory of international production." explains why corporations produce abroad, how they are able to compete successfully with domestic corporations, and where they are going to produce.

The theory selectively combines elements of various other theories (hence the name "eclectic"). According to Dunning, a company that wishes to set-up production in a foreign country and wants to operate as a MNC must simultaneously meet three conditions: ownership advantages:

location advantages; internalization advantages (Rugman and Verbeke, 2003, 2008). Ownership advantages, also known as corporation-specific advantages, are advantages in the production of a good or service that are unique to a particular company.

The range of advantages, both tangible and intangible, can be summarized as follows: proprietary technology due to research and development activities; managerial, marketing, or other skills specific to the organizational function of the corporation; product differentiation, trademarks, or brand names; large size, reflecting scale economies; large capital requirements for plants of the minimum efficient size.

The presence of ownership advantages, however, in no way fully explains the existence of the multinational company. For example, if a company gains an ownership advantage over other companies for a certain foreign market, it could, simply export its products to that market.

For this reason, the second condition must also be met: location advantages. Location advantages include all of the factors ranging from an abundance of fertile land and cheap labour to a liberal capital market and a sound infrastructure.

To that we can also add the favourable investment conditions offered by some countries to attract foreign investors. These may be in the form of subsidies, tax exemptions, or cheap housing.

At any rate, the benefits for the corporation must proceed from the combination of ownership advantages and location advantages. However, it will not necessarily lead to foreign direct investment and, therefore, to the establishment of a multinational concern.

After all, the company can also sell its ownership advantages or license them out to another company in the foreign market. That is why finally the third condition must be met as well: the internalization advantages.

Tom Burns and George Macpherson Stalker (1961) define two alternatives models of structure, which they term 'mechanistic' and 'organic'. The mechanistic structure looks rather like the bureaucracy. Burns and Stalker present the mechanistic type as the structure most appropriate to a stable industry environment.

Here divisions might be established to serve particular market niches over a long period of time. The organic structure is characterised by fluid relationships, fewer levels of authority, and fewer regulations and job descriptions.

Authority in the organic structure is allocated according to expertise, and the location of authority could change according to the demands of changing conditions.

Labour welfare is a part of social welfare, both conceptually and operationally. It covers state of well-being, happiness, satisfaction, and conservation and development of human resources.

There are seven theories, providing the structure of labour welfare, viz. The Police Theory, The Religious Theory, The Philanthropic Theory, The Trusteeship Theory or the Paternalistic Theory, The Placating Theory, The Public Relations Theory and The Functional Theory or the Efficiency Theory.

The Police Theory considers that man is selfish and self-centred, and always tries to achieve his own ends, even at the cost of the welfare of others.

The Religious Theory believes that religious feelings sometimes prompt an employer to lake up welfare activities in the expectation of future emancipation either in this life, or after it.

On the other hand, the Philanthropic Theory is based on man's love for mankind. The Trusteeship Theory or the Paternalistic Theory accepts that the employer should hold The industrial assets for himself, for the benefit of his workers, and also for society.

The Placating Theory stresses that timely and periodic acts of labour welfare can appease the workers.

The Public Relations Theory provides the basis for an atmosphere of goodwill between labour and management, and also between management and the public.

The Functional Theory or the Efficiency Theory encourage labour's participation in welfare programmes.

Unemployment occurs when manpower remains idle. Unemployment appears when a labour does not get employment opportunity despite his willingness to work at the existing wage rate.

In India, unemployment is the result of shortage of capital equipment and complimentary resources. There are various types of unemployment in India.