Social Environment

Question 1

What is the social environment?

Answer 1

• The nature and extent of divisions in societies; income and wealth, social class, ethic group, gender, tribe
• Different models of welfare provision
• Demography - population size, growth and structure
• Education - levels of literacy and educational achievement
• Health - infant and maternal mortality, life expectancy, incidence of diseases

Question 2

What is demography?

Answer 2

The study of the structural features of a population

• Population size
• Ageing population - how many old people
• Gender and ethnic distributions
  e. g rising global birthrates provide opportunities for new markets, new products etc

Question 3

Which countries have the largest populations?

Answer 3

1. China
2. India
3. USA
4. Indonesia
5. Brazil

Question 4

What is bottom of the pyramid?

Answer 4

It refers to the very poor people in society. There more poor than rich people in the world. 90% of the world’s poor are located in Africa and Asia

Question 5

How does the ageing population affect business?

Answer 5

• Europe and Asia have particularly ageing populations
• Poses challenges to governments: welfare/loss of tax
• Affects demand patterns
• Flexible working and care
• High wages
• Smaller labour force for manufacturing

Question 6

What are the other important issues that surround the social environment?

Answer 6

• Urbanisation - the proportion of people living in cities: affects market and labour availability
• Gender - glass ceiling in Saudi Arabia
• Education - level of literacy and skilled labour e.g India’s emergence in IT, Japan’s rise after WW2

Question 7

What are the four social models?

Answer 7

• Liberal
• Corporatist
• Social Democratic
• Asia

Question 8

What is liberal as a social model?

Answer 8

USA, Canada, Australia - state supported welfare, provision for health, protestant ethic, work hard for rewards

Question 9

What is corporatist as a social model?

Answer 9

Traditionally supported by the church and so welfare structured to support the family unit. E.g continental Europe

Question 10

What is social democratic as a social model?

Answer 10

Provides strong welfare support - UE, health, maternity, paternity, funded through high taxes
e.g Scandinavia

Question 11

What is Asia as a social model?

Answer 11

Tiger economies - Not driven by social welfare, but economic growth, welfare the responsibility of families

Question 12

What implications does the social environment have on business?

Answer 12

• Level of demand for goods and services (population change)
• Composition of demand for goods and services (sex and age discrimination)
• Supply of labour (ageing population)
• Quality of labour force (health and education)
• Cost of labour force
• Tax and public services (social models)