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14 Cards in this Set
- Front
- Back
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Superior features of a country that provide it with unique benefitis in global competition typically derived from either natural endowments or deliberate national policies
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Comparative advantage
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Disticntive assets or competiencies of a firm - typically derived from cost, size, or innovation strenghts that are difficult for cometitors to replicate or imitate
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Competitive advantage
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The belief that national prosperity is the result of a postive balance of trade achieved by maximizing exports and minimzing imports
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Mercantillism
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Relative absence of restrictions to the flow of goods and services between nations
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Free trade
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a contry benefts by producing only those products in which it has absolute advantage, or can produce using fewer resources than another country
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Absolute advantage prinicple
(Adam Smith) |
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It can be benefical for two countries to trade without barriers as long as one is more efficient at producing goods or services needed by the other. What matters is not the aboslute cost of production, but rather the relative efficiency with which a country can prduce the product.
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Comparative Advantage
(David Ricardo) |
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This theory states that first, products differ in the types and quantities of factors (that is, labor, natural resources, and captial) that are requried for their production, and second countries differ in the type and quantity of production factors that they possess. According to this theory, each country should export products that intensively use relatively abundant factors of production, and import goods that intensively use relatively scarce factors of production.
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Factors Proportions Theory
(note the Leontief Paradox contradicited the Factors proportion theory stating that United States though they have abundant captial, they're exports were labor intensive, and their imports were capital-intensive. much because of the intellectual labor force in america). |
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This theory states that each product and its associated manufacturing technologies go through three stages of evolution: introduction, growth, and maturity.
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International product lifecycle
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MICHAEL PORTERS DIAMOND MODEL
1)Firm Strategy, Structure, and Rivalry (refers to the nature of domestic rivalry, and conditions in a nation that determine how firms are created, organized and managed) 2)Factor Conditions (describes the Nation's position in factors of production, such as labor, nautal resources, capital, technology, entrepreneurship, and know-how 3)Demand Conditions (refers to the nature of home-market demand for specific products and services 4)Related and Supporting Industries (refers to the presence of clusters of suppliers, competitors, and complementary firms that excel in particular industries). |
MICHAEL PORTERS DIAMOND MODEL
1)Firm Strategy, Structure, and Rivalry (refers to the nature of domestic rivalry, and conditions in a nation that determine how firms are created, organized and managed) 2)Factor Conditions (describes the Nation's position in factors of production, such as labor, nautal resources, capital, technology, entrepreneurship, and know-how 3)Demand Conditions (refers to the nature of home-market demand for specific products and services 4)Related and Supporting Industries (refers to the presence of clusters of suppliers, competitors, and complementary firms that excel in particular industries). |
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A concentration of businesses suppliers and supporting firms in the same industy at a particular location, characterized by a critical mass of human talent, capital or other factor endowments
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Industrial cluster
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A proactive economic development plan initiated by the public sector, often in collaboration with the private sector, that aims to develop or support particular industries within the nation
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National industrial policy
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The firm controls one or more relatively unique products and servides that provide it a degree of monopoly power relative to foreign markets and competitors
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Monopoloistic Advantage Theory
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The firm aquires and retains one or more value-chain activities within the firm
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Internationalization Theory
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-Ownership-spefic advantages: the firm owns knowledge, skills, capabilities, processes, or physical assets
- Location-specific advantages: Factors in individual countries provide specific benefits, such as natural resources, skilled labor, low-cost labor, and inexpensive captial - Internationalization advantages: The firm benefits from internalizing foreign manufacturing, distribution, or other value-chain activities |
Dunning's Electric Paradigm
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