A Workaholic Economy

FOR THE first century or so of the industrial revolution, increased productivity led to
decreases in working hours. Employees who had been putting in 12-hour days, six days a
week, found their time on the job shrinking to 10 hours daily, then, finally, to eight hours, five
days a week. Only a generation ago social planners worried about what people would do
with all this new-found free time. In the US, at least, it seems they need not have bothered.
Although the output per hour of work has more than doubled since 1945, leisure seems
reserved largely for the unemployed and underemployed. Those who work full-time spend as
much time on the job as they did at the end of World War II. In fact, working hours have
increased noticeably since 1970 — perhaps because real wages have stagnated since that
year. Bookstores now abound with manuals describing how to manage time and cope with
stress.
There are several reasons for lost leisure. Since 1979, companies have responded to
improvements in the business climate by having employees work overtime rather than by
hiring extra personnel, says economist Juliet B. Schor of Harvard University. Indeed, the
current economic recovery has gained a certain amount of notoriety for its “jobless”
nature: increased production has been almost entirely decoupled from employment. Some
firms are even downsizing as their profits climb. “All things being equal, we”d be better off
spreading around the work,’ observes labour economist Ronald G. Ehrenberg of Cornell
University.
Yet a host of factors pushes employers to hire fewer workers for more hours and, at the
same time, compels workers to spend more time on the job. Most of those incentives involve
what Ehrenberg calls the structure of compensation: quirks in the way salaries and benefits
are organised that make it more profitable to ask 40 employees to labour an extra hour each
than to hire one more worker to do the same 40-hour job.
Professional and managerial employees supply the most obvious lesson along these lines.
Once people are on salary, their cost to a firm is the same whether they spend 35 hours a
week in the office or 70. Diminishing returns may eventually set in as overworked employees
lose efficiency or leave for more arable pastures. But in the short run, the employer’s
incentive is clear.
Even hourly employees receive benefits - such as pension contributions and medical
insurance - that are not tied to the number of hours they work. Therefore, it is more profitable
for employers to work their existing employees harder.
For all that employees complain about long hours, they, too, have reasons not to trade
money for leisure. “People who work reduced hours pay a huge penalty in career terms,”
Schor maintains. “It”s taken as a negative signal’ about their commitment to the firm.’ [Lotte]
Bailyn [of Massachusetts Institute of Technology] adds that many corporate managers find it
difficult to measure the contribution of their underlings to a firm’s well-being, so they use the
number of hours worked as a proxy for output. “Employees know this,” she says, and they
adjust their behavior accordingly.
“Although the image of the good worker is the one whose life belongs to the company,”
Bailyn says, “it doesn't fit the facts.’ She cites both quantitative and qualitative studies that
show increased productivity for part-time workers: they make better use of the time they
have, and they are less likely to succumb to fatigue in stressful jobs. Companies that employ
more workers for less time also gain from the resulting redundancy, she asserts. “The extra
people can cover the contingencies that you know are going to happen, such as when crises
take people away from the workplace.’ Positive experiences with reduced hours have begun
to change the more-is-better culture at some companies, Schor reports.
Larger firms, in particular, appear to be more willing to experiment with flexible working
arrangements...
It may take even more than changes in the financial and cultural structures of employment
for workers successfully to trade increased productivity and money for leisure time, Schor
contends. She says the U.S. market for goods has become skewed by the assumption of
full-time, two-career households. Automobile makers no longer manufacture cheap models,
and developers do not build the tiny bungalows that served the first postwar generation of
home buyers. Not even the humblest household object is made without a microprocessor. As
Schor notes, the situation is a curious inversion of the “appropriate technology” vision that
designers have had for developing countries: U.S. goods are appropriate only for high
incomes and long hours.
Paul Walluh
Questions 1-6
Do the following statements agree with the views of the writer in Reading Passage?
In boxes 1-6 write
YES if the statement agrees with the views of the writer
NO if the statement contradicts the views of the writer
NOT GIVEN if it is impossible to say what the writer thinks about this

Example Answer

During the industrial revolution people worked harder. NOT GIVEN

1 Today, employees are facing a reduction in working hours.

2 Social planners have been consulted about US employment figures.
3 Salaries have not risen significantly since the 1970s.
4 The economic recovery created more jobs.
5 Bailyn’s research shows that part-time employees work more efficiently.
6 Increased leisure time would benefit two-career households.
Questions 7-8
Choose the appropriate letters A-D and write them in boxes 7-8 on your answer sheet.
7 Bailyn argues that it is better for a company to employ more workers because
A it is easy to make excess staff redundant.
B crises occur if you are under-staffed.
C people are available to substitute for absent staff.
D they can project a positive image at work.
8 Schor thinks it will be difficult for workers in the US to reduce their working hours
because
A they would not be able to afford cars or homes.
B employers are offering high incomes for long hours.
C the future is dependent on technological advances.
D they do not wish to return to the humble post-war era.
Questions 9-12
The writer mentions a number of factors that have resulted, in employees working longer
hours.
Which FOUR of the following factors are mentioned?
Write your answers (A-H) in boxes 9-12 on your answer sheet.
List of Factors
A Books are available to help employees cope with stress.
B Extra work is offered to existing employees.
C Increased production has led to joblessness.
D Benefits and hours spent on the job are not linked.
E Overworked employees require longer to do their work.
F Longer hours indicate greater commitment to the firm.
G Managers estimate staff productivity in terms of hours worked.
H Employees value a career more than a family.
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Advantages of public transport

A new study conducted for the World Bank by Murdoch University's Institute for Science and
Technology Policy (ISTP) has demonstrated that public transport is more efficient than cars.
The study compared the proportion of wealth poured into transport by thirty-seven cities
around the world. This included both the public and private costs of building, maintaining and
using a transport system.
The study found that the Western Australian city of Perth is a good example of a city with
minimal public transport. As a result, 17% of its wealth went into transport costs.
Some European and Asian cities, on the other hand, spent as little as 5%. Professor Peter
Newman, ISTP Director, pointed out that these more efficient cities were able to put the
difference into attracting industry and jobs or creating a better place to live.
According to Professor Newman, the larger Australian city of Melbourne is a rather unusual
city in this sort of comparison. He describes it as two cities: 'A European city surrounded by
a car-dependent one'. Melbourne's large tram network has made car use in the inner city
much lower, but the outer suburbs have the same car-based structure as most other
Australian cities. The explosion in demand for accommodation in the inner suburbs of
Melbourne suggests a recent change in many people's preferences as to where they live.
Newman says this is a new, broader way of considering public transport issues. In the past,
the case for public transport has been made on the basis of environmental and social
justice considerations rather than economics. Newman, however, believes the study
demonstrates that 'the auto-dependent city model is inefficient and grossly inadequate in
economic as well as environmental terms'.
Bicycle use was not included in the study but Newman noted that the two most 'bicycle
friendly' cities considered - Amsterdam and Copenhagen - were very efficient, even though
their public transport systems were 'reasonable but not special'.
It is common for supporters of road networks to reject the models of cities with good public
transport by arguing that such systems would not work in their particular city. One objection
is climate. Some people say their city could not make more use of public transport because it
is either too hot or too cold. Newman rejects this, pointing out that public transport has
been successful in both Toronto and Singapore and, in fact, he has checked the use of cars
against climate and found 'zero correlation'.
When it comes to other physical features, road lobbies are on stronger ground. For example,
Newman accepts it would be hard for a city as hilly as Auckland to develop a really good
rail network. However, he points out that both Hong Kong and Zurich have managed to make
a success of their rail systems, heavy and light respectively, though there are few cities in
the world as hilly.
A
In fact, Newman believes the main reason for adopting one sort of transport over another is
politics: 'The more democratic the process, the more public transport is favored.' He
considers Portland, Oregon, a perfect example of this. Some years ago, federal money was
granted to build a new road. However, local pressure groups forced a referendum over
whether to spend the money on light rail instead. The rail proposal won and the railway
worked spectacularly well. In the years that have followed, more and more rail systems have
been put in, dramatically changing the nature of the city. Newman notes that Portland has
about the same population as Perth and had a similar population density at the time.
B
In the UK, travel times to work had been stable for at least six centuries, with people
avoiding situations that required them to spend more than half an hour travelling to work.
Trains and cars initially allowed people to live at greater distances without taking longer to
reach their destination. However, public infrastructure did not keep pace with urban sprawl,
causing massive congestion problems which now make commuting times far higher.
C
There is a widespread belief that increasing wealth encourages people to live farther out
where cars are the only viable transport. The example of European cities refutes that. They
are-often wealthier than their American counterparts but have not generated the same level
of car use. In Stockholm, car use has actually fallen in recent years as the city has become
larger and wealthier. A new study makes this point even more starkly. Developing cities in
Asia, such as Jakarta and Bangkok, make more use of the car than wealthy Asian cities
such as Tokyo and Singapore. In cities that developed later, the World Bank and Asian
Development Bank discouraged the building of public transport and people have been
forced to rely on cars -creating the massive traffic jams that characterize those cities.
D
Newman believes one of the best studies on how cities built for cars might be converted to
rail use is The Urban Village report, which used Melbourne as an example. It found that
pushing everyone into the city centre was not the best approach. Instead, the proposal
advocated the creation of urban villages at hundreds of sites, mostly around railway stations.
E
It was once assumed that improvements in telecommunications would lead to more
dispersal in the population as people were no longer forced into cities. However, the ISTP
team's research demonstrates that the population and job density of cities rose or remained
constant in the 1980s after decades of decline. The explanation for this seems to be that it is
valuable to place people working in related fields together. 'The new world will largely
depend on human creativity, and creativity flourishes where people come together face-to-
face.'
Questions 1-5
Reading Passage has five marked paragraphs, A-E.
Choose the correct heading for each paragraph from the list of headings below.
Write the correct number, i-viii, in boxes 1-5 on your answer sheet.
List of Headings
i Avoiding an overcrowded centre
ii A successful exercise in people power
iii The benefits of working together in cities
iv Higher incomes need not mean more cars
v Economic arguments fail to persuade
vi The impact of telecommunications on population distribution
vii Increases in travelling time
viii Responding to arguments against public transport

1 Paragraph A
2 Paragraph B
3 Paragraph C
4 Paragraph D
5 Paragraph E
Questions 6-10
Do the following statements agree with the information given in Reading Passage?
In boxes 6-10 on your answer sheet, write
TRUE if the statement agrees with the information
FALSE if the statement contradicts the information
NOT GIVEN if there is no information on this
6 The ISTP study examined public and private systems in every city of the world.
7 Efficient cities can improve the quality of life for their inhabitants.
8 An inner-city tram network is dangerous for car drivers.
9 In Melbourne, people prefer to live in the outer suburbs.
10 Cities with high levels of bicycle usage can be efficient even when public transport
is only averagely good.
Questions 11-13
Look at the following cities ( Questions 11-13) and the list of descriptions below.
Match each city with the correct description, A-F.
Write the correct letter, A-F, in boxes 11-13 on your answer sheet.
List of Descriptions
A successfully uses a light rail transport system in hilly environment
B successful public transport system despite cold winters
C profitably moved from road to light rail transport system
D hilly and inappropriate for rail transport system
E heavily dependent on cars despite widespread poverty
F inefficient due to a limited public transport system
11 Perth
12 Auckland
13 Portland
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BAKELITE - The birth of modem plastics

In 1907, Leo Hendrick Baekeland, a Belgian scientist working in New York, discovered and
patented a revolutionary new synthetic material. His invention, which he named 'Bakelite',
was of enormous technological importance, and effectively launched the modern plastics
industry.
The term 'plastic' comes from the Greek plassein, meaning 'to mould' Some plastics are
derived from natural sources, some are semi-synthetic (the result of chemical action on a
natural substance), and some are entirely synthetic, that is, chemically engineered from the
constituents of coal or oil. Some are 'thermoplastic', which means that, like candlewax, they
melt when heated and can then be reshaped. Others are 'thermosetting': like eggs, they
cannot revert to their original viscous state, and their shape is thus fixed for ever Bakelite
had the distinction of being the first totally synthetic thermosetting plastic.
The history of today's plastics begins with the discovery of a series of semi-synthetic
thermoplastic materials in the mid-nineteenth century. The impetus behind the development
of these early plastics was generated by a number of factors - immense technological
progress in the domain of chemistry, coupled with wider cultural changes, and the pragmatic
need to find acceptable substitutes for dwindling supplies of 'luxury' materials such as
tortoiseshell and ivory.
Baekeland's interest in plastics began in 1885 when, as a young chemistry student in
Belgium, he embarked on research into phenolic resins, the group of sticky substances
produced when phenol (carbolic acid) combines with an aldehyde (a volatile fluid similar to
alcohol). He soon abandoned the subject, however, only returning to it some years later. 8y
1905 he was a wealthy New Yorker, having recently made his fortune with the invention of a
new photographic paper. While Baekeland had been busily amassing dollars, some
advances had been made in the development of plastics. The years 1899 and 1900 had
seen the patenting of the first semi-synthetic thermosetting material that could be
manufactured on an industrial scale. In purely scientific terms, Baekeland's major
contribution to the field is not so much the actual discovery of the material to which he gave
his name, but rather the method by which a reaction between phenol and formaldehyde
could be controlled, thus making possible its preparation on a commercial basis. On 13 July
1907, Baekeland took out his famous patent describing this preparation, the essential
features of which are still in use today.
The original patent outlined a three-stage process, in which phenol and formaldehyde (from
wood or coal) were initially combined under vacuum inside a large egg-shaped kettle. The
result was a resin known as Novalak, which became soluble and malleable when heated.
The resin was allowed to cool in shallow trays until it hardened, and then broken up and
ground into powder. Other substances were then introduced: including fillers, such as
woodflour, asbestos or cotton, which increase strength and moisture resistance, catalysts
(substances to speed up the reaction between two chemicals without joining to either) and
hexa, a compound of ammonia and formaldehyde which supplied the additional
formaldehyde necessary to form a thermosetting resin. This resin was then left to cool and
harden, and ground up a second time. The resulting granular powder was raw Bakelite,
ready to be made into a vast range of manufactured objects. In the last stage, the heated
Bakelite was poured into a hollow mould of the required shape and subjected to extreme
heat and pressure, thereby 'setting' its form for life.
The design of Bakelite objects, everything from earrings to television sets, was governed to
a large extent by the technical requirements of the moulding process. The object could not
be designed so that it was locked into the mould and therefore difficult to extract. A common
general rule was that objects should taper towards the deepest part of the mould, and if
necessary the product was moulded in separate pieces. Moulds had to be carefully designed
so that the molten Bakelite would flow evenly and completely into the mould. Sharp corners
proved impractical and were thus avoided, giving rise to the smooth, 'streamlined' style
popular in the 1930s. The thickness of the walls of the mould was also crucial’ thick walls
took longer to cool and harden, a factor which had to be considered by the designer in order
to make the most efficient use of machines.
Baekeland's invention, although treated with disdain in its early years, went on to enjoy an
unparalleled popularity which lasted throughout the first half of the twentieth century. It
became the wonder product of the new world of industrial expansion - 'the material of a
thousand uses'. Being both non-porous and heat-resistant, Bakelite kitchen goods were
promoted as being germ-free and sterilisable. Electrical manufacturers seized on its
insulating properties, and consumers everywhere relished its dazzling array of shades,
delighted that they were now, at last, no longer restricted to the wood tones and drab browns
of the preplastic era. It then fell from favour again during the 1950s, and was despised and
destroyed in vast quantities. Recently, however, it has been experiencing something of a
renaissance, with renewed demand for original Bakelite objects in the collectors'
marketplace, and museums, societies and dedicated individuals once again appreciating the
style and originality of this innovative material.
Questions 1-3
Complete the summary.
Choose ONE WORD ONLY from the passage for each answer. Write your answers in
boxes 1-3 on your answer sheet.
Some plastics behave in a similar way to 1…………….. . In that they melt under heat and
can be moulded into new forms. Bakelite was unique because it was the first material to be
both entirely 2………….. in origin, and thermosetting.
There were several reasons for the research into plastics in the nineteenth century, among
them the great advances that had been made in the field of 3………….. and the search for
alternatives to natural resources like ivory.
Questions 9-10
Choose TWO letters A-E.
Write your answers in boxes 9-10 on your answer sheet.
NB Your answers may be given in either order.
Which TWO of the following factors influencing the design of Bakelite objects are mentioned
in the text?
A the function which the object would serve
B the ease with which the resin could fill the mould
C the facility with which the object could be removed from the mould
D the limitations of the materials used to manufacture the mould
E the fashionable styles of the period
Questions 11-13
Do the following statements agree with the information given in Reading Passage?
In boxes 11-13 on your answer sheet, write
TRUE if the statement agrees with the information
FALSE if the statement contradicts the information
NOT GIVEN if there is no information on this
11 Modern-day plastic preparation is based on the same principles as that patented in
1907.
12 Bakelite was immediately welcomed as a practical and versatile material.
13 Bakelite was only available in a limited range of colours.
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Change in business organisations

A The forces that operate to bring about change in organisations can be thought of as winds
which are many and varied - from small summer breezes that merely disturb a few papers,
to mighty howling gales which cause devastation to structures and operations, causing
consequent reorientation of purpose and rebuilding. Sometimes, however, the winds die
down to give periods of relative calm, periods of relative organisational stability. Such a
period was the agricultural age, which Goodman (1995) maintains prevailed in Europe and
western societies as a whole until the early 1700s. During this period, wealth was created in
the context of an agriculturally based society influenced mainly by local markets (both
customer and labour) and factors outside people’s control, such as the weather. During this
time, people could fairly well predict the cycle of activities required to maintain life, even if
that life might be at little more than subsistence level.
B To maintain the meteorological metaphor, stronger winds of change blew to bring in the
Industrial Revolution and the industrial age. Again, according to Goodman, this lasted for a
long time, until around 1945. It was characterised by a series of inventions and innovations
that reduced the number of people needed to work the land and, in turn, provided the means
of production of hitherto rarely obtainable goods; for organisations, supplying these in ever
increasing numbers became the aim. To a large extent, demand and supply were
predictable, enabling . companies to structure their organisations along what Burns and
Stalker (1966) described as mechanistic lines, that is as systems of strict hierarchical
structures and firm means of control.
C This situation prevailed for some time, with demand still coming mainly from the domestic
market and organisations striving to fill the ‘supply gap’. Thus the most disturbing
environmental influence on organisations of this time was the demand for products, which
outstripped supply. The saying attributed to Henry Ford that ‘You can have any colour of car
so long as it is black’, gives a flavour of the supply-led state of the market. Apart from any
technical difficulties of producing different colours of car, Ford did not have to worry about
customers’ colour preferences: he could sell all that he made. Organisations of this period
can be regarded as ‘task-oriented’, with effort being put into increasing production through
more effective and efficient production processes.
D As time passed, this favourable period for organisations began to decline. In the neo-
industrial age, people became more discriminating in the goods and services they wished to
buy and, as technological advancements brought about increased productivity, supply
overtook demand. Companies began, increasingly, to look abroad for additional markets.
E At the same time, organisations faced more intensive competition from abroad for their
own products and services. In the West, this development was accompanied by a shift in
focus from manufacturing to service, whether this merely added value to manufactured
products, or whether it was service in-its own right. In the neo-industrial age of western
countries, the emphasis moved towards adding value to goods and services - what
Goodman calls the value-oriented time, as contrasted with the task- oriented and
products/services-oriented times of the past.
F Today, in the post-industrial age, most people agree that organisational life is becoming
ever more uncertain, as the pace of change quickens and the future becomes less
predictable. Writing in 1999, Nadler and Tushman, two US academics, said: ‘Poised on the
eve of the next century, we are witnessing a profound transformation in the very nature of
our business organisations. Historic forces have converged to fundamentally reshape the
scope, strategies, and structures of large enterprises.’ At a less general level of analysis,
Graeme Leach, Chief Economist at the British Institute of Directors, claimed in the Guardian
newspaper (2000) that: ‘By 2020, the nine-to-five rat race will be extinct and present levels of
self-employment, commuting and technology use, as well as age and sex gaps, will have
changed beyond recognition.’ According to the article, Leach anticipates that: ‘In 20 years
time, 20-25 percent of the workforce will be temporary workers and many more will be
flexible, ... 25 percent of people will no longer work in a traditional office and ... 50 percent
will work from home in some form.’ Continuing to use the ‘winds of change’ metaphor, the
expectation's of damaging gale-force winds bringing the need for rebuilding that takes the
opportunity to incorporate new ideas and ways of doing things.
G Whether all this will happen is arguable. Forecasting the future is always fraught with
difficulties. For instance, Mannermann (1998) sees future studies as part art and part
science and notes: ‘The future is full of surprises, uncertainty, trends and trend breaks,
irrationality and rationality, and it is changing and escaping from our hands as time goes by.
It is also the result of actions made by innumerable more or less powerful forces.’ What
seems certain is that the organisational world is changing at a fast rate - even if the direction
of change is not always predictable. Consequently, it is crucial that organisational managers
and decision makers are aware of, and able to analyse the factors which trigger
organisational change.
Questions 1-5
Reading Passage has SEVEN paragraphs, A-G.
Which paragraph contains the following information?
Write the correct letter, A-G.
1 some specific predictions about businesses and working practices
2 reference to the way company employees were usually managed
3 a warning for business leaders
4 the description of an era notable for the relative absence of change
5 a reason why customer satisfaction was not a high priority
Questions 6-10
Look at the following characteristics (Questions 6-10) and the list of periods below.
Match each characteristic with the correct period, A, B or C.
Write the correct letter, A, B or C.
NB You may use any letter more than once.
6 a surplus of goods.
7 an emphasis on production quantity.
8 the proximity of consumers to workplaces.
9 a focus on the quality of goods.
10 new products and new ways of working.
List of periods
A The agricultural age.
B The industrial age.
C The neo-industrial age.
Questions 11-13
Complete the summary below.
Choose ONE WORD ONLY from the passage for each answer.
Businesses in the 21st century
It is generally agreed that changes are taking place more quickly now, and that organisations
are being transformed. One leading economist suggested that by 2020, up to a quarter of
employees would be 11…………………. and half of all employees would be based in
the 12 …………………. Although predictions can be wrong, the speed of change is not in
doubt, and business leaders need to understand the 13……………… that will be influential.
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Delivering The Goods

The vast expansion in international trade owes much to a revolution in the business of
moving freight
A
International trade is growing at a startling pace. While the global economy has been
expanding at a bit over 3% a year, the volume of trade has been rising at a compound
annual rate of about twice that. Foreign products, from meat to machinery, play a more
important role in almost every economy in the world, and foreign markets now tempt
businesses that never much worried about sales beyond their nation's borders.
B
What lies behind this explosion in international commerce? The general worldwide decline in
trade barriers, such as customs duties and import quotas, is surely one explanation.
The economic opening of countries that have traditionally been minor players is another. But
one force behind the import-export boom has passed all but unnoticed: the rapidly falling
cost of getting goods to market. Theoretically, in the world of trade, shipping costs do not
matter. Goods, once they have been made, are assumed to move instantly and at no cost
from place to place. The real world, however, is full of frictions. Cheap labour may make
Chinese clothing competitive in America, but if delays in shipment lie up working capital and
cause winter coats to arrive in spring, trade may lose its advantages.
C
At the turn of the 20th century, agriculture and manufacturing were the two most important
sectors almost everywhere, accounting for about 70% of total output in Germany, Italy
and France, and 40-50% in America, Britain and Japan. International commerce was
therefore dominated by raw materials, such as wheat, wood and iron ore, or processed
commodities, such as meat and steel. But these sorts of products are heavy and bulky and
the cost of transporting them relatively high.
D
Countries still trade disproportionately with their geographic neighbours. Over time, however,
world output has shitted into goods whose worth is unrelated to their size and weight.
Today, it is finished manufactured products that dominate the flow of trade, and, thanks
to technological advances such as lightweight components, manufactured goods
themselves have tended to become lighter and less bulky. As a result, less transportation is
required for every dollar's worth of imports or exports.
E
To see how this influences trade, consider the business of making disk drives for computers.
Most of the world's disk-drive manufacturing is concentrated in South-east Asia. This
is possible only because disk drives, while valuable, are small and light and so cost little
to ship. Computer manufacturers in Japan or Texas will not face hugely bigger freight bills
if they import drives from Singapore rather than purchasing them on the domestic
market. Distance therefore poses no obstacle to the globalisation of the disk-drive industry.
F
This is even more true of the fast-growing information industries. Films and compact discs
cost little to transport, even by aeroplane. Computer software can be 'exported' without
ever loading it onto a ship, simply by transmitting it over telephone lines from one country
to another, so freight rates and cargo-handling schedules become insignificant factors
in deciding where to make the product. Businesses can locate based on other
considerations, such as the availability of labour, while worrying less about the cost of
delivering their output.
G
In many countries deregulation has helped to drive the process along. But, behind the
scenes, a series of technological innovations known broadly as containerisation and
intermodal transportation has led to swift productivity improvements in cargo-handling.
Forty years ago, the process of exporting or importing involved a great many stages of
handling, which risked portions of the shipment being damaged or stolen along the way. The
invention of the container crane made it possible to load and unload containers without
capsizing the ship and the adoption of standard container sizes allowed almost any box to
be transported on any ship. By 1967, dual-purpose ships, carrying loose cargo in the hold*
and containers on the deck, were giving way to all-container vessels that moved thousands
of boxes at a time.
H
The shipping container transformed ocean shipping into a highly efficient, intensely
competitive business. But getting the cargo to and from the dock was a different
story. National governments, by and large, kept a much firmer hand on truck and railroad
tariffs than on charges for ocean freight. This started changing, however, in the mid-1970s,
when America began to deregulate its transportation industry. First airlines, then road
hauliers and railways, were freed from restrictions on what they could carry, where they
could haul it and what price they could charge. Big productivity gains resulted. Between
1985 and 1996, for example, America's freight railways dramatically reduced their
employment, trackage, and their fleets of locomotives - while increasing the amount of cargo
they hauled. Europe's railways have also shown marked, albeit smaller, productivity
improvements.
I
In America the period of huge productivity gains in transportation may be almost over, but in
most countries the process still has far to go. State ownership of railways and
airlines, regulation of freight rates and toleration of anti-competitive practices, such as cargo-
handling monopolies, all keep the cost of shipping unnecessarily high and deter international
trade. Bringing these barriers down would help the world’s economies grow even closer.
* hold: ship's storage area below deck
Questions 1-4
Reading Passage has nine paragraphs, A-I.
Which paragraph contains the following information?
Write the correct letter, A-I, in boxes 1-4 on your answer sheet.
1 a suggestion for improving trade in the future
2 the effects of the introduction of electronic delivery
3 the similar cost involved in transporting a product from abroad or from a local supplier
4 the weakening relationship between the value of goods and the cost of their delivery
Questions 5-9
Do the following statements agree with the information given in Reading Passage?
In boxes 5-9 on your answer sheet, write
TRUE if the statement agrees with the information
FALSE if the statement contradicts the information
NOT GIVEN if there is no information on this

5 International trade is increasing at a greater rate than the world economy.

6 Cheap labour guarantees effective trade conditions.
7 Japan imports more meat and steel than France.
8 Most countries continue to prefer to trade with nearby nations.
9 Small computer components are manufactured in Germany.
Questions 10-13
Complete the summary using the list of words, A-K, below.
Write the correct letter, A-K, in boxes 10-13 on your answer sheet.
THE TRANSPORT REVOLUTION
Modern cargo-handling methods have had a significant effect on 10 ………….. as the
business of moving freight around the world becomes increasingly streamlined.
Manufacturers of computers, for instance, are able to import 11 ….. ……… from overseas,
rather than having to rely on a local supplier.
The introduction of 12 ……….. has meant that bulk cargo can be safely and efficiently
moved over long distances.
While international shipping is now efficient, there is still a need for governments to
reduce 13 ……… in order to free up the domestic cargo sector.

A tariffs B components C container ships

D output E employees F insurance costs
G trade H freight I fares
J software K international standards
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Makete Integrated Rural Transport Project

Section A
The disappointing results of many conventional road transport projects in Africa led some
experts to rethink the strategy by which rural transport problems were to be tackled at the
beginning of the 1980s. A request for help in improving the availability of transport within the
remote Makete District of southwestern Tanzania presented the opportunity to try a new
approach.
The concept of 'integrated rural transport' was adopted in the task of examining the transport
needs of the rural households in the district. The objective was to reduce the time and effort
needed to obtain access to essential goods and services through an improved rural transport
system. The underlying assumption was that the time saved would be used instead for
activities that would improve the social and economic development of the communities. The
Makete Integrated Rural Transport Project (MIRTP) started in 1985 with financial support
from the Swiss Development Corporation and was co-ordinated with the help of the
Tanzanian government.
Section B
When the project began, Makete District was virtually totally isolated during the rainy
season.The regional road was in such bad shape that access to the main towns was
impossible for about three months of the year Road traffic was extremely rare within the
district, and alternative means of transport were restricted to donkeys in the north of the
district. People relied primarily on the paths, which were slippery and dangerous during the
rains.
Before solutions could be proposed, the problems had to be understood. Little was known
about the transport demands of the rural households, so Phase I, between December 1985
and December 1987, focused on research.The socio-economic survey of more than 400
households in the district indicated that a household in Makete spent, on average, seven
hours a day on transporting themselves and their goods, a figure which seemed extreme but
which has also been obtained in surveys in other rural areas in Africa. Interesting facts
regarding transport were found: 95% was on foot; 80% was within the locality; and 70% was
related to the collection of water and firewood and travelling to grinding mills.
Section C
Having determined the main transport needs, possible solutions were identified which might
reduce the time and burden. During Phase II, from January to February 1991, a number of
approaches were implemented in an effort to improve mobility and access to transport.
An improvement of the road network was considered necessary to ensure the import and
export of goods to the district.These improvements were carried out using methods that
were heavily dependent on labour In addition to the improvement of roads, these methods
provided training in the operation of a mechanical workshop and bus and truck services.
However the difference from the conventional approach was that this time consideration was
given to local transport needs outside the road network.
Most goods were transported along the paths that provide short-cuts up and down the
hillsides, but the paths were a real safety risk and made the journey on foot even more
arduous. It made sense to improve the paths by building steps, handrails and footbridges.
It was uncommon to find means of transport that were more efficient than walking but less
technologically advanced than motor vehicles. The use of bicycles was constrained by their
high cost and the lack of available spare parts. Oxen were not used at all but donkeys were
used by a few households in the northern part of the district. MIRTP focused on what would
be most appropriate for the inhabitants of Makete in terms of what was available, how much
they could afford and what they were willing to accept.
After careful consideration, the project chose the promotion of donkeys - a donkey costs less
than a bicycle - and the introduction of a locally manufacturable wheelbarrow.
Section D
At the end of Phase II, it was clear that the selected approaches to Makete’s transport
problems had had different degrees of success. Phase III, from March 1991 to March 1993,
focused on the refinement and institutionalisation of these activities.
The road improvements and accompanying maintenance system had helped make the
district centre accessible throughout the year. Essential goods from outside the district had
become more readily available at the market, and prices did not fluctuate as much as they
had done before.
Paths and secondary roads were improved only at the request of communities who were
willing to participate in construction and maintenance. However the improved paths
impressed the inhabitants, and requests for assistance greatly increased soon after only a
few improvements had been completed.
The efforts to improve the efficiency of the existing transport services were not very
successful because most of the motorised vehicles in the district broke down and there were
no resources to repair them. Even the introduction of low-cost means of transport was
difficult because of the general poverty of the district.The locally manufactured wheelbarrows
were still too expensive for all but a few of the households. Modifications to the original
design by local carpenters cut production time and costs. Other local carpenters have been
trained in the new design so that they can respond to requests. Nevertheless, a locally
produced wooden wheelbarrow which costs around 5000 Tanzanian shillings (less than
US$20) in Makete, and is about one quarter the cost of a metal wheelbarrow, is still too
expensive for most people.
Donkeys, which were imported to the district, have become more common and contribute, in
particular, to the transportation of crops and goods to market. Those who have bought
donkeys are mainly from richer households but, with an increased supply through local
breeding, donkeys should become more affordable. Meanwhile, local initiatives are
promoting the renting out of the existing donkeys.
It should be noted, however, that a donkey, which at 20,000 Tanzanian shillings costs less
than a bicycle, is still an investment equal to an average household's income over half a year
This clearly illustrates the need for supplementary measures if one wants to assist the rural
poor
Section E
It would have been easy to criticise the MIRTP for using in the early phases a 'top-down'
approach, in which decisions were made by experts and officials before being handed down
to communities, but it was necessary to start the process from the level of the governmental
authorities of the district. It would have been difficult to respond to the requests of villagers
and other rural inhabitants without the support and understanding of district authorities.
Section F
Today, nobody in the district argues about the importance of improved paths and
inexpensive means of transport. But this is the result of dedicated work over a long period,
particularly from the officers in charge of community development. They played an essential
role in raising awareness and interest among the rural communities.
The concept of integrated rural transport is now well established in Tanzania, where a major
program of rural transport is just about to start.The experiences from Makete will help in this
initiative, and Makete District will act as a reference for future work.

Questions 1-4
Reading Passage has six sections, A-F.
Choose the correct heading for sections B, C, E and F from the list of headings below.
Write the correct number, i-xi, in boxes 1-4 on your answer sheet.
List of Headings
i MIRTP as a future model
ii Identifying the main transport problems
iii Preference for motorised vehicles
iv Government authorities’ instructions
v Initial improvements in mobility and transport modes
vi Request for improved transport in Makete
vii Transport improvements in the northern part of the district
viii Improvements in the rail network
ix Effects of initial MI RTP measures
x Co-operation of district officials
xi Role of wheelbarrows and donkeys

Example Answer

Section A vi

1 Section B
2 Section C

Example Answer

Section D ix

3 Section E
4 Section F
Questions 5-9
Do the following statements agree with the claims of the writer in Reading Passage?
In boxes 5-9 on your answer sheet, write
YES if the statement agrees with the claims of the writer
NO if the statement contradicts the claims of the writer
NOT GIVEN if it is impossible to say what the writer thinks about this
5 MIRTP was divided into five phases.
6 Prior to the start of MIRTP the Makete district was almost inaccessible during the rainy
season.
7 Phase I of MIRTP consisted of a survey of household expenditure on transport.
8 The survey concluded that one-fifth or 20% of the household transport requirement
as outside the local area.
9 MIRTP hoped to improve the movement of goods from Makete district to the country’s
capital.
Questions 10-13
Complete each sentence with the correct ending, A-J, below.
Write the correct letter, A-J, in boxes 10-13 on your answer sheet.
10 Construction of footbridges, steps and handrails
11 Frequent breakdown of buses and trucks in Makete
12 The improvement of secondary roads and paths
13 The isolation of Makete for part of the year

AA provided
providedthe
thepeople
peopleofofMakete
Maketewith
withexperience
experienceininrunning
runningbus
busand
andtruck
truckservices.
services.

BB was
wasespecially
especiallysuccessful
successfulininthe
thenorthern
northernpart
partofofthe
thedistrict.
district.

CC differed
differedfrom
fromearlier
earlierphases
phasesininthat
thatthe
thecommunity
communitybecame
becameless
lessactively
activelyinvolved.
involved.

DD improved
improvedpaths
pathsused
usedfor
fortransport
transportup
upand
anddown
downhillsides.
hillsides.

EE was
wasno
nolonger
longeraaproblem
problemonce
oncethe
theroads
roadshad
hadbeen
beenimproved.
improved.

FF cost
costless
lessthan
thanlocally
locallymade
madewheelbarrows.
wheelbarrows.

GG was
wasdone
doneonly
onlyatatthe
therequest
requestofoflocal
localpeople
peoplewho
whowere
werewilling
willingtotolend
lendaahand.
hand.

HH was
wasatatfirst
firstconsidered
consideredby
byMIRTP
MIRTPtotobe
beaffordable
affordablefor
forthe
thepeople
peopleofofthe
thedistrict.
district.

I I hindered
hinderedattempts
attemptstotomake
makethe
theexisting
existingtransport
transportservices
servicesmore
moreefficient.
efficient.

JJ was
wasthought
thoughttotobe
bethe
themost
mostimportant
importantobjective
objectiveofofPhase
PhaseIII.
III.
Questions 14
Choose the correct letter, A, B, C or D.
Write the correct letter in box 14 on your answer sheet.
Which of the following phrases best describes the main aim of Reading Passage?
A to suggest that projects such as MIRTP are needed in other countries
B to describe how MIRTP was implemented and how successful it was
C to examine how MIRTP promoted the use of donkeys
D to warn that projects such as MIRTP are likely to have serious problems
Xxxxxxxxxxxxxxxxxxxxxxxxxxxxx

Measuring Organisational Performance

There is clear-cut evidence that, for a period of at least one year, supervision which
increases the direct pressure for productivity can achieve significant increases in production.
However, such short-term increases are obtained only at a substantial and serious cost to
the organisation.
To what extent can a manager make an impressive earnings record over a short period of
one to three years by exploiting the company’s investment in the human organisation in his
plant or division? To what extent will the quality of his organisation suffer if he does so? The
following is a description of an important study conducted by the Institute for Social
Research designed to answer these questions.
The study covered 500 clerical employees in four parallel divisions. Each division was
organised in exactly the same way, used the same technology, did exactly the same kind of
work, and had employees of comparable aptitudes.
Productivity in all four of the divisions depended on the number of clerks involved. The work
entailed the processing of accounts and generating of invoices. Although the volume of work
was considerable, the nature of the business was such that it could only be processed as it
came along. Consequently, the only way in which productivity could be increased was to
change the size of the workgroup.
The four divisions were assigned to two experimental programmes on a random basis. Each
programme was assigned at random a division that had been historically high in productivity
and a division that had been below average in productivity. No attempt was made to place a
division in the programme that would best fit its habitual methods of supervision used by the
manager, assistant managers, supervisors and assistant supervisors.
The experiment at the clerical level lasted for one year. Beforehand, several months were
devoted to planning, and there was also a training period of approximately six months.
Productivity was measured continuously and computed weekly throughout the year. The
attitudes of employees and supervisory staff towards their work were measured just before
and after the period.
Turning now to the heart of the study, in two divisions an attempt was made to change the
supervision so that the decision levels were pushed down and detailed supervision of the
workers reduced. More general supervision of the clerks and their supervisors was
introduced. In addition, the managers, assistant managers, supervisors and assistant
supervisors of these two divisions were trained in group methods of leadership, which they
endeavoured to use as much as their skill would permit during the experimental year. For
easy reference, the experimental changes in these two divisions will be labelled the
‘participative programme!
In the other two divisions, by contrast, the programme called for modifying the supervision so
as to increase the closeness of supervision and move the decision levels upwards. This will
be labelled the ‘hierarchically controlled programme’. These changes were accomplished by
a further extension of the scientific management approach. For example, one of the major
changes made was to have the jobs timed and to have standard times computed. This
showed that these divisions were overstaffed by about 30%. The general manager then
ordered the managers of these two divisions to cut staff by 25%. This was done by transfers
without replacing the persons who left; no one was to be dismissed.
Results of the Experiment
Changes in Productivity
Figure 1 shows the changes in salary costs per unit of work, which reflect the change in
productivity that occurred in the divisions. As will be observed, the hierarchically controlled
programmes increased productivity by about 25%. This was a result of the direct orders from
the general manager to reduce staff by that amount. Direct pressure produced a substantial
increase in production.
A significant increase in productivity of 2O% was also achieved in the participative
programme, but this was not as great an increase as in the hierarchically controlled
programme. To bring about this improvement, the clerks themselves participated in the
decision to reduce the size of the work group. (They were aware of course that productivity
increases were sought by management in conducting these experiments.) Obviously,
deciding to reduce the size of a work group by eliminating some of its members is probably
one of the most difficult decisions for a work group to make. Yet the clerks made it. In fact,
one division in the participative programme increased its productivity by about the same
amount as each of the two divisions in the hierarchically controlled programme. The other
participative division, which historically had been the poorest of all the divisions, did not do
so well and increased productivity by only 15%.
Changes in Attitudes
Although both programmes had similar effects on productivity, they had significantly different
results in other respects. The productivity increases in the hierarchically controlled
programme were accompanied by shifts in an adverse direction in such factors as loyalty,
attitudes, interest, and involvement in the work. But just the opposite was true in the
participative programme.
For example, Figure 2 shows that when more general supervision and increased
participation were provided, the employees’ feeling of responsibility to see that the work got
done increased. Again, when the supervisor was away, they kept on working. In the
hierarchically controlled programme, however, the feeling of responsibility decreased, and
when the supervisor was absent, work tended to stop.
As Figure 3 shows, the employees in the participative programme at the end of the year felt
that their manager and assistant manager were ‘closer to them’ than at the beginning of the
year. The opposite was true in the hierarchical programme. Moreover, as Figure 4 shows,
employees in the participative programme felt that their supervisors were more likely to ‘pull’
for them, or for the company and them, and not be solely interested in the company, while in
the hierarchically controlled programme, the opposite trend occurred.
Questions 1-3
Choose the appropriate letters A-D and write them in boxes 1-3 on your answer sheet.

1 The experiment was designed to

A establish whether increased productivity should be sought at any cost.
B show that four divisions could use the same technology.
C perfect a system for processing accounts.
D exploit the human organisation of a company in order to increase profits.

2 The four divisions

A each employed a staff of 500 clerks.
B each had equal levels of productivity.
C had identical patterns of organisation.
D were randomly chosen for the experiment
3 Before the experiment
A the four divisions were carefully selected to suit a specific programme.
B each division was told to reduce its level of productivity.
C the staff involved spent a number of months preparing for the study.
D the employees were questioned about their feelings towards the study.
Questions 4-9
Complete the summary below. Choose ONE word from Reading Passage for each answer.
Write your answers in boxes 4-9 on your answer sheet.
This experiment involved an organisation comprising four divisions, which were divided into
two programmes: the hierarchically controlled programme and the participative programme.
For a period of one year a different method of 4………… was used in each programme.
Throughout this time 5……………. was calculated on a weekly basis. During the course of
the experiment the following changes were made in an attempt to improve performance.

In the participative programme:

• supervision of all workers was 6 ………..
• supervisory staff were given training in 7……………

In the hierarchically controlled programme:

• supervision of all workers was increased.
• work groups were found to be 8…………. by 30%.
• the work force was 9………… by 25%.
Questions 10-13
Look at Figures 1, 2, 3 and 4 in Reading Passage.
Choose the most appropriate label, A-I, for each Figure from the box below.
Write your answers in boxes 10-13 on your answer sheet.

A Employees’ interest in the company

B Cost increases for the company

C Changes in productivity

D Employees’ feelings of responsibility towards completion of work

E Changes in productivity when supervisor was absent

F Employees’ opinion as to extent of personal support from management

G Employees feel closer to their supervisors

H Employees’ feelings towards increased supervision

I Supervisors’ opinion as to closeness of work group

10 Fig 1
11 Fig 2
12 Fig 3
13 Fig 4