Section A: Catapults - To what extent can government policy towards UK manufacturing have a significant impact on manufacturing's contribution to the economy? - Advantages and disadvantages table in A Level and IB Business

Created by: Megan
Created on: 14-06-15 18:29


	Section A: Catapults - To what extent can government policy towards UK manufacturing have a significant impact on manufacturing's contribution to the economy?
	Advantages YES, government policy towards UK manufacturing can have a significant impact because... The government can invest money into R&D centres to encourage high value-added and innovative manufacturing. UK government has invested over 200 million into HVMC research centres where manufacturers have access to specialist facilities and engineers. Encourages manufacturers to use these centres to create highly innovative products with access to needed equipment. Higher value-added manufactured goods can be made, making the UK renowned for innovative products. Increase competitiveness of UK manufacturers as products can be developed quicker and to a better standard. Exports are increased, as well as manufacturing output, which can help the aim be achieved of doubling manufacturing's contribution to UK GDP. EV: High costs to the government of opening these centres and are only effective if used by UK manufacturers to the maximum capacity. YES, government policy towards UK manufacturing can have a significant impact because... Governments have a wide range of policy tools at their disposal to support manufacturing. Can use a combination of horizontal and sectoral policies. Tax reliefs for R&D as a horizontal policy can work as an incentive for firms to increase R&D. Reduced taxation and costs to UK manufacturers if they have applied for R&D relief. Higher levels of R&D can lead to higher levels of innovation in manufacturing, especially in higher value added industries. Increase in competitiveness of higher value-added products with high levels of innovation, could lead to market leaders. Manufacturing is increased and will increase the percentage of manufacturing contribution to the UK's GDP. EV: May not be helpful for UK manufacturers that do not need high levels of R&D. These industries could become neglected and see off-shoring as a result, which will decrease the contribution.	Disadvantages NO, government policy towards UK manufacturing can't have a significant impact because... Governments have tried to reduce the decline UK manufacturing for decades and seen no significant results from their policies. UK government is mainly non-interventionist and currently has a deficit reduction plan which restricts funding it may use. While the government has invested 200 million into HVMC centres, it doesn't compare with Samsung investing 14.7 billion into a new manufacturing plant in South Korea. Government is investing lower levels of capital into manufacturing than other countries or companies such as Samsung. UK becomes less attractive as a location to move manufacturing or operate in, due to less investment in manufacturing than other countries. Reduction in UK manufacturing output and less contribution to the UK's GDP. EV: 'March of the Makers' was a a part of the coalitions policy to increase manufacturing, so it is still an important part of the government's policy as the Conservatives were elected back into government.
	Evaluation Government policy can have an impact on manufacturing's contribution to the UK's economy because it can determine the competitiveness of the UK's manufacturing as a location and in trading. The UK specialises in higher value-added products which means higher levels of investment are needed to ensure there is high levels of R&D which can allow the high value-added manufacturing to occur. Therefore it can have an impact on the manufacturing's contribution to the UK's economy through levels of investment. I believe that government policy can have a significant impact on manufacturing's contribution to the UK's GDP because the significance of research and development in higher value-added industries means that government policy can be made to support these areas which generate the higher revenues for the UK.

Section A: Catapults - To what extent can government policy towards UK manufacturing have a significant impact on manufacturing's contribution to the economy?

Advantages

YES, government policy towards UK manufacturing can have a significant impact because... The government can invest money into R&D centres to encourage high value-added and innovative manufacturing.
UK government has invested over 200 million into HVMC research centres where manufacturers have access to specialist facilities and engineers.
Encourages manufacturers to use these centres to create highly innovative products with access to needed equipment.
Higher value-added manufactured goods can be made, making the UK renowned for innovative products.
Increase competitiveness of UK manufacturers as products can be developed quicker and to a better standard.
Exports are increased, as well as manufacturing output, which can help the aim be achieved of doubling manufacturing's contribution to UK GDP.
EV: High costs to the government of opening these centres and are only effective if used by UK manufacturers to the maximum capacity.
YES, government policy towards UK manufacturing can have a significant impact because... Governments have a wide range of policy tools at their disposal to support manufacturing.
Can use a combination of horizontal and sectoral policies. Tax reliefs for R&D as a horizontal policy can work as an incentive for firms to increase R&D.
Reduced taxation and costs to UK manufacturers if they have applied for R&D relief.
Higher levels of R&D can lead to higher levels of innovation in manufacturing, especially in higher value added industries.
Increase in competitiveness of higher value-added products with high levels of innovation, could lead to market leaders.
Manufacturing is increased and will increase the percentage of manufacturing contribution to the UK's GDP.
EV: May not be helpful for UK manufacturers that do not need high levels of R&D. These industries could become neglected and see off-shoring as a result, which will decrease the contribution.

Disadvantages

NO, government policy towards UK manufacturing can't have a significant impact because... Governments have tried to reduce the decline UK manufacturing for decades and seen no significant results from their policies.
UK government is mainly non-interventionist and currently has a deficit reduction plan which restricts funding it may use.
While the government has invested 200 million into HVMC centres, it doesn't compare with Samsung investing 14.7 billion into a new manufacturing plant in South Korea.
Government is investing lower levels of capital into manufacturing than other countries or companies such as Samsung.
UK becomes less attractive as a location to move manufacturing or operate in, due to less investment in manufacturing than other countries.
Reduction in UK manufacturing output and less contribution to the UK's GDP.
EV: 'March of the Makers' was a a part of the coalitions policy to increase manufacturing, so it is still an important part of the government's policy as the Conservatives were elected back into government.

Evaluation

Government policy can have an impact on manufacturing's contribution to the UK's economy because it can determine the competitiveness of the UK's manufacturing as a location and in trading. The UK specialises in higher value-added products which means higher levels of investment are needed to ensure there is high levels of R&D which can allow the high value-added manufacturing to occur. Therefore it can have an impact on the manufacturing's contribution to the UK's economy through levels of investment. I believe that government policy can have a significant impact on manufacturing's contribution to the UK's GDP because the significance of research and development in higher value-added industries means that government policy can be made to support these areas which generate the higher revenues for the UK.

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Section A: Catapults - To what extent can government policy towards UK manufacturing have a significant impact on manufacturing's contribution to the economy?