most important exam1mkt320 (study guide)

What is globalization?

The process of increasing interconnectedness and interdependence among countries, typically through trade, investment, technology, and cultural exchange.

What is glocalization?

The practice of conducting business according to both local and global considerations; combining global strategies with local adaptation.

What is reverse innovation?

Innovations developed in emerging markets that are later introduced in developed markets.

What are the types of management orientations?

Ethnocentric: Home country is superior.

Polycentric: Each host country is unique.

Regiocentric: A region is treated as a unit.

Geocentric: Entire world is a potential market.

Standardization vs. Adaptation

Standardization: Same marketing mix across markets.

Adaptation: Tailoring the mix to local markets

What factors accelerate trade?

Technology, reduced barriers, globalization, logistics improvements.

What factors inhibit trade?

Tariffs, protectionism, cultural differences, political instability.

Resource ownership vs. resource allocation

Ownership: Who owns resources (public/private)

Allocation: How they're distributed (market/planned)

Centrally Planned Capitalism vs. Socialism

Capitalism: Private ownership + government control

Socialism: Government ownership + market control

Market Capitalism vs. Market Socialism

Capitalism: Market allocates + private ownership

Socialism: Market allocates + government ownership

What is GNI and how is it used?

Gross National Income; classifies countries by income level and market development.

Low-income country characteristics

Limited industrialization, high birth rates, low literacy, heavy agriculture.

Wrong assumptions about low-income countries

Not all are stagnant, poor, or closed to business—many are dynamic and growing.

High-income countries & G7

G7 = US, UK, Canada, France, Germany, Italy, Japan. High GDP, advanced infrastructure.

What are BRICS?

Brazil, Russia, India, China, South Africa - large emerging economies with rapid growth.

What is the US balance of trade?

The difference between exports and imports; a trade deficit means more imports than exports.

What is GATT?

General Agreement on Tariffs and Trade - reduced tariffs, promoted free trade post-WWII.

What is WTO?

World Trade Organization - successor to GATT; enforces trade rules globally.

NAFTA pros and cons

Pros: Increased trade, lower prices.Cons: Job losses, outsourcing concerns.

What is a Free Trade Area?

No internal tariffs; countries retain individual trade policies with non-members.

What is a Customs Union?

Free trade area + common external tariffs.

What is a Common Market?

Customs union + free movement of people, labor, and capital.

What is an Economic Union?

Common market + harmonized economic and monetary policy (e.g., EU).

What is the European Union?

A political and economic union of 27 countries in Europe with a common currency and regulations.

High-context vs. Low-context cultures

High: Implicit, relationship-based (e.g., Japan)

Low: Explicit, task-based (e.g., U.S.)

What is Hofstede's typology?

Cultural dimensions framework comparing countries on: power distance, uncertainty avoidance, masculinity, individualism, long-term orientation, indulgence.

Iceberg concept of culture

Surface behaviors (tip) vs. deep beliefs, values (below the surface).

Power distance

Acceptance of inequality in power and authority.

Uncertainty avoidance

Society's tolerance for ambiguity and risk.

Masculinity vs. Femininity

Masculine: Competition, achievement (e.g., Japan)

Feminine: Cooperation, care (e.g., Sweden)

Individualism vs. Collectivism

individualism: Personal goals > group (e.g., US)

Collectivism: Group goals > personal (e.g., China)

Indulgence vs. Restraint

Indulgence: Freedom of gratification

Restraint: Suppression of needs

Diffusion theory & adoption process

Explains how innovations spread across cultures: Awareness → Interest → Evaluation → Trial → Adoption.

What is sovereignty?

A country's authority over its own territory and laws.

What is political risk?

Risk of loss due to political instability or policy changes.

What are taxes in global marketing?

Government levies on income, property, or purchases affecting market entry.

What is asset seizure?

Government taking private assets through expropriation, confiscation, or nationalization.

Common law vs. Civil law

Common: Based on precedents (e.g., US, UK)

Civil: Based on written codes (e.g., France)

What is jurisdiction?

Legal authority to rule on a case.

What is a patent?

Exclusive rights to an invention.

What is a trademark?

legal protection of brand names and logos.

What is copyright?

Protection of creative works (books, music, etc.)

Counterfeiting vs. Piracy

Counterfeiting: Fake goods.

Piracy: Unauthorized copying of copyrighted material.

What is antitrust law?

Prevents monopolies and promotes fair competition.

What is licensing?

Granting rights to use intellectual property in exchange for fees or royalties.