QUESTIONS

1) Summarize the globalization debate.

• Introduction
• Importance of globalisation
o Globalisation of markets
(1) EU, having a lot of countries under it, becomes a large market for a company to
venture into
o Globalisation of products
(1) Companies look for places of raw materials to produce
(2) They outsource supplies for cheaper areas
• Criticism
o Loss to national sovereignty
(1) Unskilled labour will suffer in the developed nation because labour is more
expensive there
(2) Negative influence from foreign presence in the country
(3) There is a saying “think globally and act nationally”
(4) Location of businesses in nations with less rules
(a) This leads to pollution in the local nations
o Negative economic growth
(1) Pollution, depletion of the environment,
o Argue the need to be careful of assuming that because there is one large market, the
conditions will be the same all round
o Unless the positive consequences of globalisation exceeds the negatives, critics will
ever speak against globalization
o High income inequality
(1) They leave their homelands for cheaper labour here. So, unemployment in the
homelands and also cheap labour when they move to the less developed nations
o Unemployment in home and foreign countries
2) What are the major interest groups in the world economy?
• People(consumers/human resource(workers))
• Company
• Socio political(government, political environment
• Multinational Enterprise
• Transanational Corporation
• Transnational Media Organisation (BBC, CNN)
• NGO’s
1. Or take them by
• Developed nations
• Emerging markets
• Developing nations

3) How are they affected by different elements of globalization?

• The elements are
o Expansion of markets
 o Challenges to the states and institutions
o Rise of new social movements
i. Or it may be tackled by
o Management – without the right managerial competencies, it ill not be easy to go
abroad(global)
o Transnational capital
o Labour – for as long as there is going to be production in another country

• the fact that the world is now a smaller place and that everything that happens in one part
of the world has some effect on another part of the world
• of resources
o Globalisation of markets is the merging of historically distinct and separate national
markets into one distinct market.
• Of product(ion)
o The sourcing of goods and services from location to minimise cost or maximise quality
o Cost and quality
4) Who benefits and who loses from a shift in jobs to low-wage economies? Consider this
question from the perspective of consumers, labour, technological change, firms, nation-
states. Are the net benefits likely to be positive?
• Introduction
• Net benefits
o High economies
(1) Jobs will suffer
(2) Low prices
o Low economies
(1) More jobs for the people
• Technological change may affect the high economies because they are giving off the
technology
• Firms
o Domestic firms will learn from the experience comeing in from
• Nation states
o Low wage states will benefit
o

5) Identify and evaluate the sources of conflict between pressures on companies to operate
globally and the desire of governments to regulate companies and activities within their
borders.
• Introduction
o The underlying reason for any company’s existence is profit
• Why companies go global
• Why governments may regulate companies
• Sources of Conflict
• Conclusion

• Every business man is looking for profit.. the underlying basic pressure on the business
to perform.
• There’s the need for the business to access the competition, environment and all that
 • Reasons why companies go global include
o Profit
o To be competitive
o For cheaper labour
o To explore the larger market offering
o Cost management, to reduce cost of production
o To access cheaper resources (labour/material)
o Very intense competition in one’s local market may cause a local firm to try to go
global

• 2 major reasons why companies will want to go global are

o Market Seeking – this may refer to either a expanding a market that is already
existing or venturing into new market/regions
(1) Profit driven
(2) Focus on the customer
o Resource Seeking
(1) Materials - cheaper and of higher quality
(2) Labour – cheaper labour,
(3) Technology
• Labour - The company is interested in its profits, the government is looking at its
people.. making sure that they are not disadvantaged or exploited. The company may
seriously compromise on the welfare of the people because they will put their profit
drive first. The government is also careful not to push too hard because that can drive
the companies away and end up increasing unemployment. Mainly, governments may
have conflicts with MNEs because of the under listed
o Job protection
o National security
o Protecting cultural values
o Protection of human rights

• Materials – the company in its search for cheaper materials may end up
destroying/harming the environment. This brings a conflict of interest because its
government’s duty to ensure that is guarded.

6) Account for the existence of counter trade in the world economy and explore the view
that its influence will continue as a solution to the problem developing countries face when
attempting to export to western markets?
• Introduction
o Talk about trade, international trade and gradually shift to counter trade
o Refined barter trade. This could be between a company and a government, a company
and another company or a government and another government.
• Countertrade
• Export problems of developing countries
o International standards must be met before we export but this is not enforced by
governments in developing countries
o “Perishability” of the goods sent out because no value is added to the raw materials
sent out
o Non-value added commodity
o The packaging of good from developing countries are usually unattractive
 o Most goods that go out are raw materials and may only receive low prices because of
low quality
o Quota on export size for developing countries
• The influence
o We need cash to facilitate economic activities. Getting the cash is difficult. If we
partake in “barter” we can use the cash we have available to focus on other areas that
require development
o Our raw abundant materials may be exchanged for the resources available in the
developed countries like technology.

7) Analyze the likely impact on domestic markets of import restrictions via tariffs and
quotas respectively. Discuss the dynamic side effects that can arise from import protection.

8) In the light of the strategic significance of price discrimination between cross-border markets
to firms, evaluate the merits of anti-dumping measures.

9) Outline the static and dynamic effects of a customs union and explain why regional
integration blocs composed of small economies are unlikely to be economically beneficial.

10) Evaluate the advantages and disadvantages of the joint venture over licensing as a foreign
market entry mode. Describe scenarios when licensing might be the preferable one of the two
entry modes.

11) International franchising is often regarded as a low-risk foreign market entry strategy. Does
this view fully reflect the attraction of international franchising as a market entry mode?

12) Under what circumstances would a BOT system make sense as an international marketing
strategy?