International Business: Globalization Today

Vocabulary practice flashcards covering fundamental concepts, definitions, historical phases, drivers, and major debates of international business and globalization from Chapter 1.

International Business

Any commercial transaction that crosses the borders of two or more nations.

Imports

Goods and services purchased abroad and brought into a country.

Exports

Goods and services sold abroad and sent out of a country.

Multinational Corporation (MNC)

A business that has direct investments abroad in multiple countries.

Foreign Direct Investment (FDI)

The purchase of physical assets or a significant amount of ownership in another country to gain a measure of management control.

Born Global Firm

A company with a global perspective that engages in international business from inception and quickly achieves a competitive advantage.

Globalization

The trend toward greater economic, cultural, political, and technological interdependence among national institutions and economies.

Denationalization

The process by which national boundaries become progressively less relevant, characterizing the phenomenon of globalization.

Gross Domestic Product (GDP)

The value of all goods and services produced by a domestic economy during a one-year period.

Gross National Product (GNP)

The value of all goods and services produced by a country's domestic and international activities during a one-year period.

GDP or GNP Per Capita

A nation's gross domestic product (GDP) or gross national product (GNP) divided by its total population.

First Age of Globalization

The period from the mid-1800s to the 1920s characterized by mobile labor, free-flowing capital, transatlantic cables, and trade reaching approximately 10% of annual output, which ended with World War I.

Second Age of Globalization

The period from 1989 to the present initiated by the fall of the Berlin Wall, technological advancements, expansion of trade blocs, China joining the WTO, and global supply chains.

Globalization of Markets

The convergence in buyer preferences in markets around the world.

Globalization of Production

The dispersal of production activities worldwide to minimize costs or maximize quality.

General Agreement on Tariffs and Trade (GATT)

A treaty designed to promote free trade by reducing tariffs and nontariff barriers to international trade.

Tariffs

Taxes levied on traded goods.

Nontariff Barriers

Limits placed on the quantity of an imported product.

World Trade Organization (WTO)

The international organization that enforces the rules of international trade.

The World Bank

An international agency created to provide financing for national economic development efforts.

International Monetary Fund (IMF)

An agency created to regulate fixed exchange rates and to enforce the rules of the international monetary system.

Regional Trade Agreements

Agreements among groups of nations in a geographic area to reduce trade barriers, including arrangements like the USMCA, the European Union (EU), and APEC.

E-Commerce

The use of computer networks to purchase, sell, or exchange products; to service customers; and to collaborate with partners.

Internet of Things (IoT)

All devices and equipment that are readable, recognizable, locatable, addressable, and/or controllable via the internet.

Digitization

The process of changing information from analog to digital form for use by computers and other information technologies.

Digitalization

The use of digital data and technology to develop new business operations, strategies, or business models.

Digital Transformation

A fundamental organizational shift in which digital technologies penetrate all areas of operations, strategy, and culture to produce customer-focused competitive advantage.

Company Intranets and Extranets

Internal and extended corporate computer networks used to share proprietary information, coordinate internal operations, and collaborate with business partners.

Worker Dislocation

The displacement of employees from their occupations due to manufacturing relocation or foreign competition, which critics argue reduces domestic wages.

Inequality Within Nations

The widening income and wage disparity between white-collar and blue-collar occupations within advanced or wealthy economies.

Inequality Between Nations

The widening divergence in average incomes and standard of living between rich and poor nations across the globe.

Cultural Homogenization Debate

The debate over whether globalization allows nations to benefit from differing skills or destroys cultural diversity by standardizing consumer tastes worldwide.

National Sovereignty Debate

The controversy regarding whether globalization undermines national democracy by empowering supranational institutions or serves as a guardian that spreads democratic principles.

"Race to the Bottom"

An argument against globalization stating that multinational firms relocate manufacturing to nations with the weakest environmental and labor regulations to minimize operational costs.

Global Business Environment Model

A framework mapping international business across concentric contexts: the global environment, the international business environment, national environments, and firm-level business operations.