• Shuffle
    Toggle On
    Toggle Off
  • Alphabetize
    Toggle On
    Toggle Off
  • Front First
    Toggle On
    Toggle Off
  • Both Sides
    Toggle On
    Toggle Off
  • Read
    Toggle On
    Toggle Off
Reading...
Front

Card Range To Study

through

image

Play button

image

Play button

image

Progress

1/45

Click to flip

Use LEFT and RIGHT arrow keys to navigate between flashcards;

Use UP and DOWN arrow keys to flip the card;

H to show hint;

A reads text to speech;

45 Cards in this Set

  • Front
  • Back

What is Driving globalization

Declining trade barriers: average tariff is 4%, more favorable for FDI




Technological change: phones, planes, all can save money, low transportation costs, low cost for communication and networking




Low trade barriers and investment mean firms can: View the world as a singlemarket, firms may also find they’re under attack by foreign firms

GDP

Measures level of economic development (Gross domestic product)

PPP

Purchasing power parity-How much could your 10$ get you in other places

G7/E7

· G7-largest advanced economies


E7-Largest emerging market economies

Measures level of economic development

· Institutions-The state, rule of law, accountability, market economy

The state

has legitimate use of force or violence, power to defend itself internally and externally, ability to enforce laws. Modern state must effectively collect taxes. (government)

Rule of law

· Law applies to everyone equally (even state), Property rights

Accountability

Free, regular elections. Universal suffrage, free press, political competition, separate powers of state. (Basically our rights, no country can be too powerful).

Market economy

free market

are engines to long term economic growth. They need a free market

Innovation and entrepreneurship are engines to long term economic growth. They need a free market (what do they do and what do they need)

Higher economic freedom=

higher economic growth

Why is international trade good

· countries produce what they’re best at and trade for what they need therefore helping aworld economy

Mercantalist philosophy

Export more than they import so you can “win,” there’s always a country that loses intrade

Adam Smith-Absolute advantage

if a company has an absolute advantage in a product they should make that productand export it

Ricardo’s theory of comparative advantage

Countries should specialize in the production of the goods they produce most efficiently and buy goods in which they’re less effective at producing (Even if this means buying from countries that they could produce more efficiently at home).

Why is comparative advantage beneficial

because total output is higher and both countries mutually win in trade

Paul Samuleson

free trade may ultimately result in lower wages in the rich country due to outsourcing; domestic companies must lower wages to compete with foreign countries

Ohlin and Heckscher

factor endowments, countries export what they’re endowed with (oil, skilled labor)and import what is scarce

How does government intervene in markets?

Use of tariffs


Subsidies-


Importquotas-


Voluntary export restraints (VERs)-


Local content requirements


Anti dumping policies

Tariffs

(taxes on imports that raise cost of imported goods compared to domestic products)




they increase government revenue, force consumers to pay more for certain imports, therefore they’re pro producer and anti consumer.

Subsidies

· Government payments to domestic products (helps domestic producers compete against low cost foreign imports) could be cash grants, low-interest loans, or tax breaks.

Import quotas

· restrict content of some goods that may be imported into a country

Voluntary export restraints (VERs)-

Quotas on trade imposed by exporting country, typically at request of the importing country’s government (Benefit domestic producers, and raise price of imported goods)

Local content requirements

demand that some specific fraction of a good be produced domestically

Anti-dumping policies

· punish foreign forms for dumping (selling below market value) to protect domestic producers from unfair foreign competition

What Are The Political ArgumentsFor Government Intervention?

Protecting jobs


Protecting industries that are deemed important for national security


Protecting from dangerous products


Furthering goals of foreign policy


protecting human rights


protecting the environment



Furthering goals of foreign policy

preferential trade terms can be granted to countries that a government wants to build strong relations with

Economic reasons for government intervention

The infant industry argument


Strategic trade policy

The infant industry argument

an industry should be protected until it can develop and beviable and competitive internationally

Strategic trade policy

first-mover advantages can be important to success

GATT vs WTO

GATT is a set of guidelines and rules while The World Trade Organization is an actual organization

Elements of Culture

Values• Norms• Rituals• Symbols• Beliefs

Culture

the sum of the values, norms, rituals,symbols, beliefs, and thought processes that are learned, shared by a group of people, and transmitted from generation to generation

Values

are abstract ideas about what a group believes to be good, right, and desirable

What Are Norms?

folkways - the routine conventions of everyday life• Generally have little moral significance.• Examples would be dress, eating habits, and social graces. An outsider caneasily be forgiven for being ignorant of a folkway.




mores - norms that are central to the functioning of a society (standards of behavior)

What Determines Culture

The values and norms of a culture evolve over time•




Determinants include– religion– political and economic philosophies– education– language– social structure

How Are Individuals and Groups Different?

In Western societies, there is a focus on theindividual




individual achievement is common – high level of entrepreneurship

What Is The Role of Education in Culture?

Formal education is the medium through which individuals learn many of the language,conceptual, and mathematical skills that are indispensable in a modern society

How Does Culture Impact The Workplace?

Management processes and practices must be adapted to culturally determined work-related values

Power/Distance

Distance of power between manager and subordinate


(high-obvious power distance


Low-Managers and subordinates almost seen as equal)

Individualism

Individualism- taking care of yourself and immediate family, while collectivism is groups look after each other for loyalty


High-(Freedom/respect for privacy)


collectivism(Low)- (Team building, work for intrinsic rewards)

Masculinity

Tough vs tender society


(high-Achievement, heroism, and assertiveness)


(Low-cooperation, modesty and caring for the weak)

Uncertainty avoidance

How much a culture like to be uncertain


(High-Formal business conduct with rules, need structure, differences are avoided)


(Low-Informal business, accepting of change and risk)

Long term orentation

Whether a person looks for short term gratification or long term.


(high-High value placed on learning and education, strong work ethic)


(Low-Treat other how you wanna be treated, individualism, promotion of equality)

Hofstede's model

Individualism, Power distance, Masculinity, Long term orientation, Uncertainty avoidance