Chapter04 - InternationalManagement Globalization

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International Management
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Globalization The flow of goods and services, capital (money), and  knowledge across country borders. Thomas Friedman,  The Lexus and the Olive Tree 1999;  The World Is Flat , 2005,  2008 Three stages of globalization: Internationalization of countries Companies moving into international markets door neighbors and competitors” Thomas Friedman
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Thomas Friedman The increasing interdependence among  countries, companies, and even  individuals across country borders has  reduced the influence that national  governments can have on their  economies. Small firms look big Less developed economies have smart  entrepreneurs Outsourcing
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Outsourcing Outsourcing Institute Accenture Outsourcing.org Outsourcing Medical Tourism Medical Tourism
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Understanding a Country’s  Environment CIA.GOV Purchasing Power Parity (PPP) Economic Development OECD Political-Legal Transparency Rule of Law Sarbanes-Oxley Act, 2002, CEO & CFO
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Country Institutional Environment  Clusters Cluster 1:  Brazil, Russia, Nigeria Cluster 2:  Emerging market countries A little higher on political rights, low on monetary policy;  second highest on investment restrictions China, India, The Netherlands, Singapore Cluster 3:  Second highest regulatory controls & high in political rights;  strong physical infrastructure Western Europe: Finland, France, Germany, Portugal,  Sweden Cluster 4:  Most developed institutional infrastructure with balanced  regulatory controls & political rights; infrastructure Only the United States & Japan
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Understanding a Country’s  Environment, cont. Attractive institutional dimensions affect a  firm’s willingness to make direct  investments (FDI) Practical Impact: E.g., the greater the number of  multinationals in a country, the greater the  pressure on government to reduce  corruption
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Understanding a Country’s  Environment, cont. Cultural Power Distance Extent to which people  accept differences among people High in Mexico, Venezuela Low in Israel and Denmark Uncertainty Avoidance The need to be clear or ambiguous (preference for  rules) More comfortable with uncertainty in US, Sweden Need more rules in Japan, Indonesia
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This note was uploaded on 05/26/2011 for the course MGMT 3000 taught by Professor Roberthirschfeld during the Spring '08 term at University of Georgia Athens.

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Chapter04 - InternationalManagement Globalization

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