Attitude towards foreign firms it will increase entry

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attitude towards foreign firms, it will increase entry barriers, including taxes, or evenlimit the amount of goods that can be imported from that country.b)Political system in place – ideally, there are two forms of political systems, namelydemocracy and totalitarianism. These two forms are portrayed in Figure 2.1.Figure 2.1: Forms of political systemsForms of political systemsDemocracyTotalitarianismParliamentaryPresidentialSecularTheocraticDemocracydemocracytotalitarianismtotalitarianismSource: developed for this chapter.Dr Ben MuliliPrinciples of Marketing ManualPage 41
Democracy, in its purest form, refers to a government by the people, of the people and for thepeople. However, as countries or economies become bigger, it has been modified into theparliamentary and presidential democracy. The parliamentary democracy occurs when electedparliamentarians make most of the decisions, while presidential democracy manifests itself whenthe president, himself or herself selected/elected by the people, makes most of the decisions.Table 2.1 summarizes the characteristics of democracy.Table 2.1: Characteristics of democracyProminent rule of lawUniversal right to voteFreedom of expression, speech and associationLimited term for elected leadersPolitical decision making processIndependent and fair court systemSource: developed for this chapter.Totalitarianism, also called authoritarianism, occurs when power is centralized in the hands of afew powerful individuals, or even a single individual, who allows no opposition and whoseconstitution guarantees him or her right to rule for as long as he or she wants. Sometimes, thedictator leaves the office to one of his or her children, or to a close relative, thereby creating amonarch. This is the secular totalitarianism. Germany under Adolf Hitler was an authoritarianstate. In the theocratic totalitarianism, the leader is also a spiritual leader, meaning that he or shehas been ‘appointed by God’ to rule the people. Theocratic leaders frame and enforce laws thatare based on religious beliefs. Afghanistan, Tibet (Dalai Lama) and Pakistan are examples ofsuch countries.c)Political stability:Lack of political stability within acountry can significantly impact the operations of abusiness. This can especially be true for businesses thatare operating on the global scale. For instance, a hostiletakeover can take over a government. Eventually, such asituation will lead to looting, riots and general disorderwithin the environment. Such situations can disruptbusiness operations and activities which can have a majorimpact on its bottom line.It is generally assumed that if politicaltemperatures are down; businesses tend to flourish and the vice versa is also correct.

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Term
Summer
Professor
dr.okello
Tags
Marketing, The Road, Dr Ben Mulili

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