Flashcards
IBUS 321 MIDTERM
Cards in this deck (48)
- 1foreign direct investment (FDI)direct investment in business operations in a foreign country.
The acquisition or construction of a physical capital by a firm from one (source) country to another (host) country - 2General agreement on Tariffs and Trade (GATT)int. treaty that committed signatories to lowering barriers to the free flow of goods across national borders and led to the WTO
- 3globalizationtrend away from distinct national economic units and toward one huge global market
- 4types of globalizationmarkets
production
consumers - 5int. businessany firm that engages in int. trade or investment
- 6International Monetary Fund (IMF)int. institution set up to maintain order in the int. monetary system
- 7moore's lawthe power of microprocessor tech. doubles and its cost of prod. fall by half every 18mos
- 8multinational enterprise (MNE)a firm that owns business operations in more than one country
- 9united nationsformed in 1945 to promote peace, security, and co-operation
- 10world bankint. institution set up to promote general econ. development in the worlds poorer nations
- 11world trade org. (WTO)succeeded the GATT
- 12main drivers of globalization1) decline in barriers
2) tech. change - 13two trends of demographics1) non US multinationals
2) growth of multinationals - 14Bill S-21Corruption of Foreign Officials Act
(makes bribing foreign officials a criminal offence) - 15types of legal systemscivil = judge applies law
common = judge interprets law
theocratic = religious teachings - 16political economyrefers to the political, economic and legal systems of a country
(individualism, collectivism, totalitarianism, democracy) - 17individualismemphasis on the importance of guaranteeing individual freedom & self expression
- 18collectivismemphasizes collective goals
(communism & social democrats) - 19democracygov. is by the people, either directly or through elected representatives
- 20totalitarianismone person or party exercises absolute control
(communism, theocratic, tribal, right wing) - 21characteristics that make a country democratic1) freedom of expression
2) freely elect leaders
3) free media
4) non political police force - 22Economic Systems1) Mixed
2) Market
3) Command - 23ethicsaccepted principles on right or wrong that govern conduct
- 24Friedman doctrinedoesnt think business should improve conditions beyond required, reduces profits
- 25cultural relativismfirms should adopt the ethics of the culture in which its operating
- 26righteous moralistmultinationals home country standard of ethics are the ones companies should follow in foreign countries
- 27naive immoralistif a manager sees firms in other nations not following ethical norms in a host nation, they shouldnt either
- 28CSRbusiness should consider social consequences of their actions
- 29stances1) obstructionist - deny any fault
2) defensive - wasnt out fault
3) accommodative - go further than expected
4) proactive - reach out to customers - 30rights theories20th century theory that human beings have fundamental rights and privileges that transcend national boundaries and cultures
- 31free tradeabsence of barriers to the free flow of goods and serv. between countries
- 32mercantilismeconomic philosophy advocating that countries should simultaneously encourage exports and discourage imports
- 33absolute & comparative advantageabsolute - ability to produce a good more efficiently than any other country
comparative - countries should specialize in most efficient production - 34positive & zero sum gamepositive = all countries benefit, even if some benefit more than others
zero = economic gain in one country results in loss for another - 35Porters Diamond model1) Factor Endowments
2) Demand conditions
3) Relating and supporting industries
4) Firm strategy, structure and rivalry - 36ad valorem tarifftariff levied as a proportion of the value of an imported good
- 37administrative trade policiesbureaucratic rules adopted by gov. to restrict imports or boost exports
- 38antidumping policies (aka countervailing duties)designed to punish foreign firms that engage in dumping and thus protect domestic producers from unfair foreign comp.
- 39dumpingselling goods in a foreign market for less than their cost of prod. or below their fair market value
- 40import quotadirect restriction on the quantity of good that can be imported into a country
- 41local content requirementdemand that some specific fraction of a good be produced domestically
- 42specific tarifftariff levied as a fixed charge for each unit of good imported
- 43subsidygov. financial assistance to a domestic producer
- 44tarifftax levied on imports
- 45voluntary export restraint (VER)quota on trade imposed from the exporting country's side, instead of the importers, usually imposed at the request of the importing country's gov.
- 46instruments of trade policy1) tariffs
2) subsidies
3) import quota
4) voluntary export restraint
5) local content
6) administrative trade policies
7) antidumping policies - 47political arguments for gov. intervention1) Protect jobs from unfair foreign comp.
2) national security
3) retaliation - 48economic arguments for gov. intervention1) infant industry argument
2) strategic trade policy
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- Flashcards on IBUS 321 MIDTERM, created by Lauren Wilson on 19/10/2019.
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- Lauren Wilson
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