ch.2

These flashcards summarize key concepts from the lecture on national differences in political, economic, and legal systems, essential for understanding international business.

Political Economy

The interdependent political, economic, and legal systems of a country that influence each other.

Collectivism

An ideology emphasizing collective goals over individual goals, often associated with socialism.

Individualism

An ideology that prioritizes individual freedoms and self-interest over collective goals.

Democracy

A system of government by the people, either directly or through elected representatives, characterized by civil liberties.

Totalitarianism

A political system where absolute control is exercised by a single entity or party over all aspects of life.

Market Economy

An economic system where all productive activities are privately owned and determined by supply and demand.

Command Economy

An economic system where the government makes all production decisions for the good of society.

Mixed Economy

An economic system that combines private and government ownership of resources.

Common Law

A legal system based on tradition, precedent, and custom, characterized by flexibility.

Civil Law

A legal system based on codified laws and principles, which is less adversarial than common law.

Property Rights

Legal rights pertaining to the use and income generated from resources held by individuals or businesses.

Intellectual Property

Property that is the product of intellectual activity, including inventions, designs, and artistic works.

Foreign Corrupt Practices Act (FCPA)

A law making it illegal to bribe foreign government officials to obtain or retain business.

Contract Law

The body of law governing the enforcement of contracts, which varies significantly between common and civil law systems.

Product Liability

Legal responsibility held by a firm and its officers for harm caused by a product that does not meet safety standards.

Pseudo-democracy

A political system that is between a democracy and a totalitarian regime, with some authoritarian elements.

Privatization

The process of transferring ownership of a business, enterprise, or public service from the government to private individuals.

Corruption Perceptions Index

An index that ranks countries based on how corrupt their public sector is perceived to be, with 0 being highly corrupt and 100 being very clean.