Chapter 1: The Rapid Change of International Business
Download
Report
Transcript Chapter 1: The Rapid Change of International Business
The Rapid Change of
International Business
Chapter 1
Terms to Know
International Business
Foreign Business
Multidomestic company
Global company
Transnational company?
International company
History of International Trade
BC
1500’s and 1600’s
Late 1800’s
Early 1900’s
Present Day
What is Globalization?
“The international integration of goods,
technology, labor, and capital.”
Forces for Globalization
Political
Technological
Information
Markets
Market
Trading agreements
Decreasing barriers
Privatization
“Pull” companies over with you
Cost
Competitive
Increasing
Counter maneuver
Explosive Growth
Foreign Direct Investment
US= 10%
Total assets in 2002: $26.5 trill. (grew 8.3%)
53.1 million jobs
Exporting
Importing
International Companies
63,800 companies in 2002, 866,000 affiliates
25% of global output, 2/3 of trade
The Debate over Globalization
For:
Raises standard of living
Creates jobs
Against:
Uneven results across nations
Deleterious effects in labor and labor
standards
Decline in environment and health standards
International Environment
Environment
Three environments
Domestic
Foreign
International
Two classifications
Uncontrollable
Controllable
Uncontrollable Factors
Competitive
Distributive
Economic
Socioeconomic
Financial
Legal
Physical
Political
Sociocultural
Labor
Technological
Controllable Factors
Factors of Production
Capital
Raw materials
People
Activities of the Organization
Personnel
Finance
Production
Marketing
Three Environments
Domestic
Foreign
Most familiar
Affect overseas operations
Different face values
Changes difficult to assess
Forces interrelated
International
More complex
Self-reference criteria