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    Chapter One - Introduction - International - Trade

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    Ma'am Carla Kristina Cruz
    Globalization is increasing economic, cultural, political, and technological interdependence among countries. It involves both the globalization of markets, where companies produce and sell similar goods worldwide to reduce costs, and the globalization of production, where companies disperse operations globally. Forces driving globalization include falling trade barriers and advances in technology. However, critics argue it may eliminate jobs, lower wages, and increase inequality both within and between countries. Supporters counter that it increases wealth and efficiency. Managing international business also differs from domestic business due to differing national environments.

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    Chapter One - Introduction - International - Trade

    Uploaded by

    Ma'am Carla Kristina Cruz
    10 views28 pages
    Globalization is increasing economic, cultural, political, and technological interdependence among countries. It involves both the globalization of markets, where companies produce and sell similar goods worldwide to reduce costs, and the globalization of production, where companies disperse operations globally. Forces driving globalization include falling trade barriers and advances in technology. However, critics argue it may eliminate jobs, lower wages, and increase inequality both within and between countries. Supporters counter that it increases wealth and efficiency. Managing international business also differs from domestic business due to differing national environments.

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    Globalization is increasing economic, cultural, political, and technological interdependence among countries. It involves both the globalization of markets, where companies produce and sell similar goods worldwide to reduce costs, and the globalization of production, where companies disperse operations globally. Forces driving globalization include falling trade barriers and advances in technology. However, critics argue it may eliminate jobs, lower wages, and increase inequality both within and between countries. Supporters counter that it increases wealth and efficiency. Managing international business also differs from domestic business due to differing national environments.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    10 views28 pages

    Chapter One - Introduction - International - Trade

    Uploaded by

    Ma'am Carla Kristina Cruz
    Globalization is increasing economic, cultural, political, and technological interdependence among countries. It involves both the globalization of markets, where companies produce and sell similar goods worldwide to reduce costs, and the globalization of production, where companies disperse operations globally. Forces driving globalization include falling trade barriers and advances in technology. However, critics argue it may eliminate jobs, lower wages, and increase inequality both within and between countries. Supporters counter that it increases wealth and efficiency. Managing international business also differs from domestic business due to differing national environments.

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    © All Rights Reserved
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    Download as pptx, pdf, or txt
    of 28

    1

    CHAPTER ONE
    GLOBALIZATION
    Learning Objectives

    1. Identify the types of companies active in international business.


    2. Explain globalization and how it affects markets and production.
    3. Detail the forces that are driving globalization.
    4. Outline the debate over globalization’s impact on jobs and wages.
    5. Summarize the debate over income inequality.
    6. Outline the debate over culture, sovereignty, and the environment.
    7. Describe the global business environment and its main elements.
    Apple’s Global iMPACT

    “User-Centered Design”
    Globalization
    Produce and sell worldwide with little or
    no modification
    Reduces Apple’s production and
    marketing costs
    Supports Apple’s global brand strategy
    Challenges
    Higher price
    International Business

    International • Commercial transaction that crosses the


    Business borders of two or more nations
    • Goods and services purchased abroad and
    Imports
    brought into a country
    • Goods and services sold abroad and sent
    Exports
    out of a country
    Key Players in International Business

    Large companies from the wealthiest nations

    Firms from emerging markets

    Small and medium-sized companies

    Multinational corporation (MNC)

    Born global firm


    Quick Study 1

    1. What is the value of goods and services that all nations of the
    world export every year?
    2. A business that has direct investments in marketing or
    manufacturing subsidiaries in multiple countries is called a what?
    3. A born global firm engages in international business from or near
    its inception and does what else?
    What Is Globalization?

    Globalization: Trend toward greater economic, cultural, political,


    and technological interdependence among national institutions and
    economies
    Globalization is characterized by denationalization
    Globalization is different from internationalization
    What Is Globalization?

    Globalization
    Globalization
    of
    of markets
    production
    Dispersal of
    Convergence in
    production activities
    buyer preferences in
    worldwide to
    markets around the
    minimize costs or
    world
    maximize quality
    What Is Globalization?
    Globalization of Markets

    Benefits of Globalization of
    Markets
    • Reduces marketing costs
    • Creates new market opportunities
    • Levels uneven income streams
    • Local buyers’ needs
    • Global sustainability
    What Is Globalization?
    Globalization of Production

    Benefits of Globalization of
    Production
    • Access lower-cost workers
    • Access technical expertise
    • Access production inputs
    Quick Study 2

    1. Globalization causes the institutions and economies of nations to


    become what?
    2. What benefits might companies obtain from the globalization of
    markets?
    3. Sustainability is development that meets present needs without
    compromising what?
    Forces Driving Globalization
    Falling Barriers to Trade and Investment

    General Agreement on Tariffs and


    Trade (GATT)
    World Trade Organization (WTO)
    Other international organizations
    The World Bank
    The International Monetary Fund
    (IMF)
    Regional trade agreements
    Trade and national output
    Forces Driving Globalization
    Technological innovation

    E-business (E-commerce)

    E-mail and Videoconferencing.

    Internet

    Company Intranets and Extranets

    Advancements in Transportation Technologies


    Forces Driving Globalization
    Measuring Globalization
    Quick Study 3

    1. What global organizations have helped expand globalization?


    2. What technological innovations are helping to propel
    globalization?
    3. What nations rank high in terms of globalization?
    Debate Over Jobs and Wages
    Against Globalization

    Eliminates jobs in
    developed nations
    Lowers wages in
    developed nations
    Exploits workers in
    developing nations
    Debate Over Jobs and Wages
    For Globalization

    Increases wealth and efficiency in all nations


    Generates labor market flexibility in developed nations
    Advances the economies of developing nations
    Quick Study 4

    1. In the debate over jobs and wages, opponents of globalization say


    that it does what?
    2. In the debate over jobs and wages, supporters of globalization say
    that it does what?
    Debate Over Income Inequality

    Inequality Within • Wage gap between white-collar and


    Nations blue-collar occupations in rich nations

    Inequality • Widening the gap in average incomes


    Between Nations between rich and poor nations

    Global Inequality • Widening income inequality between


    all people of the world

    Copyright © 2016 Pearson Education Limited Chapter 1-20


    Quick Study 5

    1. Evidence suggests that globalization can help developing nations


    boost incomes for their poorest citizens in what part of the debate
    over inequality?
    2. In the debate over inequality between nations, evidence suggests
    that developing nations that are open to trade and investment do
    what?
    3. Regarding the debate over global inequality, experts tend to agree
    on what?
    Debate Over Culture, Sovereignty, and the Environment
    Globalization and Culture

    Allows us to Homogenizes
    profit from our world
    our differing and destroys
    circumstances our rich
    and skills diversity of
    cultures
    Debate Over Culture, Sovereignty, and the Environment
    Globalization and National Sovereignty

    Guardian of Menace to
    Democracy? democracy?
    Globalization Empowers
    spreads democracy supranational
    worldwide institutions at the
    expense of national
    governments
    Debate Over Culture, Sovereignty, and the Environment
    Globalization and the Environment

    Most international “Race to the


    firms today Bottom”
    support
    reasonable
    environmental
    laws
    Quick Study 6

    1. People opposed to globalization say that it does what to national


    cultures?
    2. Regarding national sovereignty, opponents of globalization say
    that it does what?
    3. With regard to the physical environment, what do globalization
    supporters argue?
    The Global Business Environment

    Forces of Globalization
    International Business Environment
    National Business Environments
    International Firm Management
    The Global Business Environment

    Copyright © 2016 Pearson Education Limited Chapter 1-27


    Quick Study 7

    1. It helps to think about international business as four elements that


    occur within a what?
    2. How does managing an international firm differ from managing a
    purely domestic business?

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