Studied by 3 people
International
Global, nationwide, cross-countries, foreign, worldwide, etc
Business
Work, dealings, commerce, transactions, source of income, profits, etc
Trade
Exchange, barter system, swap, conversion, etc.
Globalization
refers to the shift toward a more integrated and interdependent world economy.
Facets of Globalization
Globalization of Business
Globalization of Health Care
Globalization of Education& Research
Globalization of Technology
Globalization of Religion
Globalization of Poverty
Globalization of Law
Globalization of Culture & Tradition
Globalization of Politics
Globalization of Economy
Globalization of Currency
Globalization of Organizations1
Globalization of Business
Globalization of Markets Globalization of Production
Globalization of Markets
refers to the merging of historically distinct and separate national markets into one huge global marketplace.
Globalization of Production
refers to the sourcing of goods and services from locations around the globe
Global Institutions:
GATT / WTO - General Agreement on Tariffs and Trade / World Trade Organization
IMF - International Monetary Fund
WB - World Bank
UN - United Nations
World Trade Organization (WTO)
is primarily responsible for policing the world trading system and making sure nation-states adhere to the rules laid down in trade treaties
International Monetary Fund (IMF)
was established to maintain order in the international monetary system
World Bank (WB)
was set up to promote economic development
World Bank (WB)
an international organization dedicated to providing financing, advice, and research to developing nations
United Nations (UN)
was established October 24, 1945, by 51 countries committed to preserving peace through international cooperation and collective security
United Nations has the important goal
of improving the well-being of people around the world.
Divers of Globalization
Declining trade and investment barriers.
Technological Advancement
International Business
is any firm that engages in international trade or investment
Political System
the system of government in a nation
Political systems can be assessed according to two dimensions.
The first is the degree to which they emphasize collectivism as opposed to individualism.
The second is the degree to which they are democratic or totalitarian.
Collectivism
refers to a political system that stresses the primacy of collective goals over individual goals
Individualism
refers to a philosophy that an individual should have freedom in his or her economic and political pursuits.
Democracy
refers to a political system in which government is by the people, exercised either directly or through elected representatives.
Representative Democracy
Citizens periodically elect individuals to represent them.
Totalitarianism
is a form of government in which one person or political party exercises absolute control over all spheres of human life
Types of Totalitarianism
Theocratic totalitarianism Tribal totalitarianism Right-wing totalitarianism Communist totalitarianism
Theocratic totalitarianism
is found in states where political power is monopolized by a party, group, or individual that governs according to religious principles.
Tribal totalitarianism
occurs when a political party that represents the interests of a particular tribe (and not always the majority tribe) monopolizes power.
Right-wing totalitarianism
generally permits some individual economic freedom but restricts individual political freedom
Communist totalitarianism
advocates achieving socialism through totalitarian dictatorship. The most famous among the four.
Economic System
A means by which societies or governments organize and distribute available resources, services, and goods across a geographic region or country
Public Action
Means disciplinary actions, disciplinary fines, reprimands, probation, conditions or restrictions on a licensee, suspensions, summary suspensions, cease and desist orders, revocations, denials of license, or any other type of action taken by a member Board that is public.
Economic systems regulate the factors of
production, including land, capital, labor, and physical resources
Types of Economic System
market economy, command economy, mixed economy
Market Economy
all productive activities are privately owned, as opposed to being owned by the state.
Command Economy
the government plans the goods and services that a country produces
Mixed Economy
certain sectors of the economy are left to private ownership and free market mechanisms
Legal Systems
Common Law System Civil law system Theocratic law system
Common Law System
is based on tradition, precedent, and custom.
Civil Law System
is based on a detailed set of laws organized into codes.
Theocratic Law System
is one in which the law is based on religious teachings.
Contract
A document that specifies the conditions under which an exchange is to occur and details the rights and obligations of the parties involved.
Contract Law
The body of law that governs contract enforcement.
Property Rights
Refers to the legal rights over the use to which a resource is put and over the use made of any income that may be derived from that resource.
Private Action
Refers to theft, piracy, blackmail, and the like by private individuals or groups.
Intellectual property
refers to property that is the product of intellectual activity, such as computer software, a screenplay, a music score, or the chemical formula for a new drug.
Patent
grants the inventor of a new product or process exclusive rights for a defined period to the manufacture, use, or sale of that invention.
Copyrights
are the exclusive legal rights of authors, composers, playwrights, artists, and publishers to publish and disperse their work as they see fit.
Trademarks
are designs and names, often officially registered, by which merchants or manufacturers designate and differentiate their products (e.g., Christian Dior clothes)
Product safety laws
set certain safety standards to which a product must adhere.
Product liability
involves holding a firm and its officers responsible when a product causes injury, death, or damage.
Gross National Income (GNI)
is the total amount of money earned by a nation's people and businesses.
Gross Domestic Product (GDP)
is the total monetary or market value of all the finished goods and services produced within a country's borders in a specific time period.
Purchasing Power Parity (PPP)
the measurement of prices in different countries that uses the prices of specific goods to compare the absolute purchasing power of the countries' currencies, and, to some extent, their people's living standards.
HDI
Used to measure the quality of human life in different nations.
3 measures of HDI:
Life expectancy at birth, educational attainment & Income sufficiency
Deregulation
involves removing legal restrictions to the free play of the markets, the establishment of private enterprises, and the manner in which private enterprises operate.
Privatization
transfer of ownership from state property to private individuals.
Political Risk
the likelihood that political forces will cause drastic changes in a country's business environment.
Economic Risk
the likelihood that economic mismanagement will cause drastic changes in a country's business environment.
Legal Risk
the likelihood that a trading partner will break a contract or expropriate property rights.
Cross-cultural Literacy
an understanding how cultural differences across and within nations can affect the way business is practiced.
Culture
a system of value and norms that are shared among people & that when taken together constitute a design for living.
Culture
a system of value and norms that are shared among people & that when taken together constitute a design for living.
Values
abstract ideas about what a group believes to be good, right, and desirable.
Norms
social rules and guidelines that prescribe appropriate behavior in particular situations.
Society
a group of people who share a common set of values and norms.
Folkways
routine conventions of daily life.
Mores
norms that are seen as central to the functioning of a society to its social life.
Social Structure
a basic social organization.
Group
an association of 2 or more individuals w/ shared sense of identity or goals.
Social Strata
society's categorization of its people.
Social Mobility
the extent to w/c individuals can move out of the strata into which they are born.
Caste System
closed system of stratification in w/c social position is determined by the family into which a person is born and change in that position is not possible.
Class System
an open stratification in w/c the position a person has by birth can be changed through his or her achievements or luck
Class Consciousness
a condition where people tend to perceive themselves in terms of their class background
Religion
a system of shared beliefs and rituals that are concerned with the realm of the sacred.
Language
spoken and unspoken means of communication
Spoken language
defines the characteristics of a culture.
Unspoken language
nonverbal communication.
Formal education
the medium thru w/c individuals learn.
ethics
refers to accepted principles of right or wrong that govern the conduct of a person, the members of a profession, or the actions of an organization.
Business ethics
are the accepted principles of right or wrong governing the conduct of businesspeople, and an ethical strategy is one that does not violate these accepted principles.
Ethical dilemmas
are situations in which none of the available alternatives seems ethically acceptable.
Unethical behavior
is rooted in poor personal ethics, societal culture, the psychological and geographical distances of a foreign subsidiary from the home office
approaches to business ethics
the Friedman doctrine, cultural relativism, the righteous moralist, and the naive immoralist are unsatisfactory in important ways.
Friedman doctrine
states that the only social responsibility of business is to increase profits, as long as the company stays within the rules of law
Cultural relativism
contends that one should adopt the ethics of the culture in which one is doing business.
righteous moralist
monolithically applies home-country ethics to a foreign situation
naive immoralist
believes that if a manager of a multinational sees that firms from other nations are not following ethical norms in a host nation, that manager should not either.
Utilitarian approaches to ethics
hold that the moral worth of actions or practices is determined by their consequences
Kantian ethics
state that people should be treated as ends and never purely as means to the ends of others
John Rawls
developed concept of justice
concept of justice
suggests that a decision is just and ethical if people would allow for it when designing a social system under a veil of ignorance.
To make sure that ethical issues are considered in international business decisions, managers should
(a) favor hiring and promoting people with a well-grounded sense of personal ethics; (b) build an organization culture that places a high value on ethical behavior; ( c ) make sure that leaders within the business not only articulate the rhetoric of ethical behavior, but also act in a manner that is consistent with that rhetoric; (d) put decision-making processes in place that require people to consider the ethical dimension of business decisions; (e) be morally courageous and encourage others to do the same.
Ethical strategy
is a strategy, or course of action, that does not violate these accepted principles
Garrett Hardin
Tragedy of the common
tragedy of the common
occurs when a resource held in common by all, but owned by no one, is overused by individuals, resulting in its degradation.
Foreign Corrupt Practices Act
in the United States. The act outlawed the paying of bribes to foreign government officials to gain business.
social responsibility
refers to the idea that businesspeople should consider the social consequences of economic actions when making business decisions
Noblesse oblige
is a French term that refers to honorable and benevolent behavior considered the responsibility of people of high (noble) birth.
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