mgtstudyguide - Globalization shift toward a more...

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Globalization – shift toward a more integrated and interdependent world economy. Components of Globalization: Globalization of Markets – merging of distinctly separated national markets into a global market place Globalization of Production – Sourcing of goods and services from locations around the world to exploit national differences in the cost and quality of factors of production. Drivers of Globalization: Declining Trade - Investment Barriers – tariffs were imposed to protect domestic goods Technological Change – microprocessors and telecommunication, internet and world wide web, transportation technology. Limits to Globalization of Markets – significant difference still exist among national markets, the most global of markets are for industrial goods and materials that have universal applicability Limits to Globalization of Production – managing a global web of suppliers and production facilities is complex, the cost of using a nation’s factors of production can change, ex. Gov’t policies and trade , transportation cost, exchange rate fluctuates, resources availability. Global Web of Production Facilities Containerization (see page 15)- it made it easier to use different modes of transportation easier and made it cheaper. truck containers The Globalization Debate: The Positives of and Concerns with Globalization Risks in International Business: Commercial – loss due to poorly developed or executed strategy, tactics or procedures –international expansion cost more money Political – changes in gov’t policies that adversely impact the profitability or value of firms – gov’t increases min wage or restricts input/output Economic – loss due to adverse impact of fluctions in exchange rates. Legal – loss due to contract violations, inadequate protection of property rights, violation of intellectual property rights – international trade contracts Cultural – loss due to culturally-based differences in customs, attitudes, values, etc. . Intellectual Property – property that is the product of intellectual activity Intellectual Property Rights –establish ownership rights over intellectual property Patents – grant the inventor of a new product or process exclusive rights for a period to manufacture, use or sale of the invention Copyrights – exclusive legal rights of authors, composers, playwrights, to publish and disperse their work as they see fit Trademarks – designts and names by which firms designate and differentiate their products. Tariffs – duties imposed by gov’t on imported or exported goods Nontariff Barriers – any gov’t regulation, policy, or procedure other than a tariff that has the effect of impeding international trade.
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Factors of Production – resources used in the production of goods and services. -
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This note was uploaded on 11/16/2010 for the course MGT 302 taught by Professor West during the Spring '10 term at University of Arizona- Tucson.

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mgtstudyguide - Globalization shift toward a more...

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