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43 Cards in this Set
- Front
- Back
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environmental sectors
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-political-borders
-culture-language barriers -education -physical-distance -legal-trade barriers -economic-instability |
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global environments
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the crucial difference b/t domestic and international management, in any field is the diff in the operating environment
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trends in global environments
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-globalization of business & markets
-growth of market driven economies -formation of regional economic blocks -global logistics |
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reasons for economic cooperation
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-economies of scale and specialization
-access to mass markets -access to supplies -increased competition -lower prices and greater consumer choice -"expanding the market base" |
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economies of scale
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trying to extract the most of what you've got to lower unit costs
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access to mass markets
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marketing economies
improved segmentation abilities |
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NAFTA
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USA, Canada, and Mexico
went into effect on Jan 1, 1994 accounts for 37% of all US trade,155 billion in American investment, 800 mill people and 13 trillion economy |
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Association of Southeast Asian Nations (ASEAN)
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Indonesia, Malaysia, Philippines, Singapore, Thailand, Brunei, Daraussalam, Vietnam, Laos, Myanmar, and Cambodia
-total pop 500 mill. |
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Mercado Comun del sur
(MERCOSUR) |
Argentina, Brazil, Paraguay, and Uruguay
-nearly 200 mill people latin americas largest industrial base |
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European Union (EU)
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15 countries currently members
-market area of 320 mill people -historically know as the Common Market -Created after WWII -to join, countries must fulfill conditions known as the 'Copenhagen Criteria' |
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EU con't
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was established in 1987 thru the Single European Act
-EU has eliminated: -physical barriers like customs -technical barriers like health and safety -fiscal barriers like value-added tax and excise taxes |
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cabotage
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reserving the right to transport domestic products on domestic freight
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RANDOM FACT ABOUT TURKEY
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it isn't a member of the EU bc its a fully muslim country.
the skyline on the asia side is mosques and on the europe side more churches |
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problems with regionalism
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-dislocation of resources-labor etc
-increase in gov bureaucracy -loss of national autonomy -too diverse economies/cultures -too poor |
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national sovereignty
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the absolute right and power of the sovereign to rule over and govern it's population and various activities that occur within it's territory. criteria:
-independence -an effective government -a permanent population -an economy -capacity to conduct foreign relations ex. somalia is not a SV, el salvador was called "banana republic" |
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territory
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the geographic/physical boundaries of a nation
-land and internal waters -law of the sea (UNCLOS 1983) -Air space |
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UNCLOS 1983
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territorial waters is 12 miles
exclusive economic zone is 200 miles and high seas is fair game for any one |
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Transit privilege Air
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the right granted to a carrier by a nation to cross the territory of that nation in the pursuit of it's business activity, but not necessarily stop in that country
ex. refueling, or flying over on route. air rights are negotiated by countries and they have very strict rules |
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service privilege
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the right granted to a carrier by a nation to enter the territory of that nation in order to provide transport service to, from, or within the country.
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transit privilege ocean
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the right of free passage through non-territorial waters
-special cases are straights, canals & archipelagoes |
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Mare Liberum- Freedom of the Seas
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dictates that high seas are open to anyone
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interference with shipping in international waters
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slave trading & piracy
to verify the flag of registration in self defense or threat to peace time of war drug and immigration |
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Service rights- Ocean
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open port policy
open market policy cross trades |
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open port policy
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ports of each nation are open to the vessels of the other nation
-may limit specific ports for national defense reasons |
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open market policy
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shipping markets of each country are open to the vessels of the other country regardless of the origin or destination of the cargo
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cross trades
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access of third party nations to the trade route
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service rights-Air
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typical negotiated terms
-limits on locations for landings -limits on equipment used -limits on the number of flights Air commercial freedoms -right to originate traffic at home and deliver it to the foreign country -right to pick up traffic in the foreign country destined for the home nation -right to serve third countries not a part of the bi-lateral agreement |
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company interest in flag requirements
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-protection of assets against seizure, without due cause
-low cost operating conditions -subsidies and financial advantages -market entry restrictions |
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national flag interest
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diplomacy
jobs balance of payments taxes |
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Anti-trust: restrictive trade practices
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US: more vigorous in enforcement
US: price fixing or cartels are illegal US: restrains US firms from participating in Foreign cartels |
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US Foreign Corrupt Practices Act
(FCPA) |
1997: prevent bribery and alot of countries do not have this law or ones similar
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other legal issues
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-product liability
-wage and price controls -labor regulations -currency exchange controls -FCPA -US anti-boycott law |
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culture
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sum total of beliefs, values, institutions, rules, techniques, and artifacts that characterize the human population.
-it is learned,and shared, and elements of culture and inter-related |
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Socio-culture components
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aesthetics
education attitudes and beliefs language religion societal organization material culture legal characteristics political structures |
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Tempo-centrism
"time frame" |
one's perception of time is distorted by his/her own existence and experiences
-tendency to consider events predating their own existence as "less than real" -inabilitiy to see a future independent of their present and past experiences |
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Ethno-centrism
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belief that the values and characteristics of one's own group constitute the desirable norm. when other groups deviate from this norm they are considered to be incorrect.
ex. belief that ones culture is better than another culture |
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Geo-centrism
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one's center of perspective is based on his/her geographic location.
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High context
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-establish social trust first
-value personal relations and goodwill -agreement by general trust -negotiations slow and ritualistic ex. chinese, japanese, arab |
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Low context
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-get down to business first
-value expertise and performance -agreement by specific, legalistic contract -negotiations as efficient as possible ex. US, germany, swiss |
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Power distance
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communication style: audience selection
High: philippines, mexico low: israel, denmark |
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individualism/collectivism
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communication style: audience selection
Most individ: US, australia most collect: colombia, peru |
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uncertainty avoidance
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comm style: audience motivation
high: japan, portugal, greece low: hong kong, singapore |
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masculinity/femininity
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comm style: audience motivation
Masculine: japan, austria, italy Feminine: sweden, norway |
