INB 3300 Alexey Semenov Test 1

Globalization

process of social, economic, political, cultural, and technological integration

Two types of globalization

production and markets

International Business

commercial transaction that crosses 2 or more borders

FDI

foreign direct investment

E-Business

use of computer networks to do business

International Trade

when firms export goods internationally

What does globalization increase in firms?

performance and efficiency

types of international businesses

multinational corporation, small businesses, born global firms

multinational corporation

Has direct investment in 2 or more countries

Small Business

Small business that eventually became global

Born Global Firm

Created in order to be international from the beginning

types of markets

Developed, emerging, traditional

developed market

middle class can buy most things

emerging markets

markets that are trying to catch up to developed markets

Traditional Markets

little to no globalization, high level of corruption

2 main drivers of globalization

advance in technology and decrease in entry barriers

culture

set of values, beliefs, rules, and institutions held by a group of people

subculture

people who share a unique way of life within a larger, more dominant culture

Ethnocentricity

the idea that your culture is superior to other cultures

values

ideas, beliefs, and customs to which people are emotionally attached

attitudes

positive, negative evaluations, feelings, and tendencies people hold towards objects and situations

what determines attitudes

values

manners

appropriate behavior, speech, and dressing in general

customs

traditional habits

Hofstede's Cultural Dimensions

power distance, individualism, masculinity, uncertainty avoidance, long-term orientation, indulgence

power distance

Degree to which societies accept the idea that inequalities exist

Individualism

giving priority to one's own goals over group

uncertainty avoidance

Identifies the extent to which a culture avoids uncertainty. Higher scores have more security, lower scores take more economic and personal risks

masculine culture

materialistic, personally assertive, values achievement

Feminine culture

relaxed lifestyles, nonmaterial importance

indulgent culture

more basic needs are met, instant gratification prevalent ideology

political economy

combination of politics, legal systems, and economy

political system

structures, processes, and activities by which a nation governs themselves

collectivism

values goals of whole society

What is the main difference between political systems?

ownership of institutions

Totalitatianism

government control over the political, economic, social, intellectual, and cultural lives of its citizen

kinds of property seizure

confiscation, expropriation, nationalization

confiscation

forced transfer of assets from company to govt- no compensation

expropriation

Forced transfer of assets from a company to the government with compensation

nationalization

forced transfer of an entire industry to gov't

types of economic systems

centrally planned, mixed, market

centrally planned economy

everything is owned by government

mixed economy

both government and people own property and industry

market economy

mostly individuals own institutions

legal systems

rules, laws that regulate the country

Common Law

most flexible, based on situational precedent

civil law

law based on human rights that defines obligations, responsibilities, and privileges, less flexible than common law

theocratic law

law based on religion, least flexible

property rights

legal rights an owner has to make income from a resource

Foreign Corrupt Practices Act

a law that prohibits U.S. corporations from making illegal payments to public officials of foreign governments to obtain business rights or to enhance their business dealings in those countries

private action

theft, piracy, etc. by private groups or individuals

Public Action

public officials extort income from property holders

global legal issues

no standardization, product safety and liability, taxation, antitrust laws