Learn: Global Business and Culture

PSEG Analysis

Political, Socio-Cultural, Economic, and Geographic factors affecting global business.

Scarcity

When something is in demand and limited in supply.

Absolute Advantage

When a country has economic resources that allow it to produce at a lower unit cost than any other country.

Benefits of International Business

Market Expansion, Resource Access, and Cost Reduction & Economies of Scale.

Drawbacks of International Business

Cultural & Communication Barriers, Regulatory & Political Risks, and Increased Logistics Costs.

Domestic Business

Transactions, production, and sales occurring entirely within a single nation under one set of laws, currency, and culture.

International Business

Cross-border trade and transactions involving multiple nations requiring adaptation to different currencies, legal systems, and cultures.

Global Dependency

Essential needs from other countries that we must get from them.

Supply and Demand Laws

Supply is the seller/producer and demand is the buyer/consumer.

Levels of Economic Development

Less Developed, Developed, and Industrialized.

Balance of Trade

Exports minus Imports; a negative result is a deficit, and a positive result is a surplus.

Economic Systems

Market, Command, Traditional, and Mixed.

Culture

A system of learned, shared, unifying, and interrelated beliefs, values, and assumptions.

Subculture

A subset of a larger culture with beliefs, values, and assumptions that might differ from the larger culture.

Cultural Baggage

Carrying your beliefs, values, and assumptions with you at all times, influencing how you respond to others and conduct business.

Class System

Dividing the members of a cultural group into various levels.

High-Context vs. Low-Context Cultures

High-context involves communicating indirectly, while low-context involves communicating directly.

GDP vs. GNP

GDP measures goods and services produced within a country; GNP also includes production in other countries using the home country's resources.