lOMoAR cPSD| 42147428
2
D270 Comprehensive Midterm Review
Guide
, lOMoAR cPSD| 42147428
3
Chapter 1 - Globalization
• Globalization The widening and deepening of interdependent relationships among
people from different nations.
• International Business Any commercial transaction between 2 or more countries
• The Forces Behind the Current Extent of Globalization
1. Increase in and application of technology
▪ Improvements in transportation and communication networks
2. Liberalization of cross-border trade and resource movements
3. Development of services that support international business activities
▪ Banking, transportation, etc.
4. Growing consumer pressures
▪ Consumer demand for foreign products and on MNC behaviors
5. Increased global competition
▪ Born-global Companies companies that start out with a global focus
because of their founders’ international experience
6. Changing political situations and government policies
7. Expanded cross-national cooperation
▪ WTO, IMF, NAFTA, EU, treaties, and agreements
• Positive aspects of globalization (as decided by the class):
1. Specialization leads to lower costs and higher availability
2. Strengthening of political relationships
3. Spreading of culture
4. Lower costs/innovation
5. Sustainability
• Negative aspects of globalization (as decided by the class):
1. Higher income inequality
2. Poor labor standards/exploitation
3. Losing employment to outsourcing
4. Lower quality
5. Security issues
6. Environmental stress
• Three major negatives of globalization
1. Threats to national sovereignty
▪ Sovereignty a country’s freedom to “act locally” and without externally
imposed restrictions
▪ Small countries feel threatened and overly dependent
▪ Cultural homogeneity threatens uniqueness
2. Environmental Stress
▪ Depletion of resources/pollution/climate change
3. Growing income inequality and stress
▪ Greater division between rich and poor
▪ Threat of job loss leads to personal stress
• Factors affecting globalization
2
D270 Comprehensive Midterm Review
Guide
, lOMoAR cPSD| 42147428
3
Chapter 1 - Globalization
• Globalization The widening and deepening of interdependent relationships among
people from different nations.
• International Business Any commercial transaction between 2 or more countries
• The Forces Behind the Current Extent of Globalization
1. Increase in and application of technology
▪ Improvements in transportation and communication networks
2. Liberalization of cross-border trade and resource movements
3. Development of services that support international business activities
▪ Banking, transportation, etc.
4. Growing consumer pressures
▪ Consumer demand for foreign products and on MNC behaviors
5. Increased global competition
▪ Born-global Companies companies that start out with a global focus
because of their founders’ international experience
6. Changing political situations and government policies
7. Expanded cross-national cooperation
▪ WTO, IMF, NAFTA, EU, treaties, and agreements
• Positive aspects of globalization (as decided by the class):
1. Specialization leads to lower costs and higher availability
2. Strengthening of political relationships
3. Spreading of culture
4. Lower costs/innovation
5. Sustainability
• Negative aspects of globalization (as decided by the class):
1. Higher income inequality
2. Poor labor standards/exploitation
3. Losing employment to outsourcing
4. Lower quality
5. Security issues
6. Environmental stress
• Three major negatives of globalization
1. Threats to national sovereignty
▪ Sovereignty a country’s freedom to “act locally” and without externally
imposed restrictions
▪ Small countries feel threatened and overly dependent
▪ Cultural homogeneity threatens uniqueness
2. Environmental Stress
▪ Depletion of resources/pollution/climate change
3. Growing income inequality and stress
▪ Greater division between rich and poor
▪ Threat of job loss leads to personal stress
• Factors affecting globalization
