International Management Classes Summary
Class 1: Learning objectives course:
1.Evaluate global competitive landscape (economic, political, technological and institutional dimensions)
2. Assess the sources of advantage for firms (from resource profile and geographic location)
3. Evaluate strategies multinational enterprises employ to leverage resource and location characteristics
4. Evaluate the different ways in which MNEs can organize their expansion into global markets
5. Evaluate how MNE's take advantage of opportunities and deal with challenges in doing business in
emerging economies
International business strategy: effectively and efficiently match a MNE’s internal strengths (relative to
competitors) with the opportunities and challenges found in geographically dispersed environments
that cross international borders. Create and capture value (satisfy stakeholder goals, domestic &
international)
Global integration (trends):
- Economic integration of world is increasing:
o Expanding division of international production (increasing value added in foreign
countries), enhanced specialization of high-skilled labor (decline of percentage value
added in high-income countries, but increase in share of capital and high-skilled labor)
o Trend drivers: decrease of transportation and communication (leads to transparency of
value chain) costs
The argument: increase integration across globe, distance matters less, country borders matter less
- But, the integration process of economies has many frictions:
o Home country biases > invest in home country. Concentration of investments in
domestic market of investor.
o Restrictions international mobility of labor
o National borders significantly affect commerce
o Slow international price arbitrage in commodities (raw materials)
- So, national borders matter in important ways:
o Low level of internationalization in some sectors (<10%)
o Even when culture, language, institutions are similar trade across border is less than
within national border
Firms and global markets
Concentration of share of export value lies with multi-products exporters, which export to a variety of
countries (92,9% of total export value, 11,9% of exporters). Concentrated export activity in terms of
value in very few firms. Moreover, exporters are more productive than non-exporters, and experience
greater productivity improvements.
Global competition, challenges – greater economic integration of markets has the following effects:
- Increase demand for variety of products
- Increase size of market
- Increase intensity of competition
- Increase need of innovation
Class 1: Learning objectives course:
1.Evaluate global competitive landscape (economic, political, technological and institutional dimensions)
2. Assess the sources of advantage for firms (from resource profile and geographic location)
3. Evaluate strategies multinational enterprises employ to leverage resource and location characteristics
4. Evaluate the different ways in which MNEs can organize their expansion into global markets
5. Evaluate how MNE's take advantage of opportunities and deal with challenges in doing business in
emerging economies
International business strategy: effectively and efficiently match a MNE’s internal strengths (relative to
competitors) with the opportunities and challenges found in geographically dispersed environments
that cross international borders. Create and capture value (satisfy stakeholder goals, domestic &
international)
Global integration (trends):
- Economic integration of world is increasing:
o Expanding division of international production (increasing value added in foreign
countries), enhanced specialization of high-skilled labor (decline of percentage value
added in high-income countries, but increase in share of capital and high-skilled labor)
o Trend drivers: decrease of transportation and communication (leads to transparency of
value chain) costs
The argument: increase integration across globe, distance matters less, country borders matter less
- But, the integration process of economies has many frictions:
o Home country biases > invest in home country. Concentration of investments in
domestic market of investor.
o Restrictions international mobility of labor
o National borders significantly affect commerce
o Slow international price arbitrage in commodities (raw materials)
- So, national borders matter in important ways:
o Low level of internationalization in some sectors (<10%)
o Even when culture, language, institutions are similar trade across border is less than
within national border
Firms and global markets
Concentration of share of export value lies with multi-products exporters, which export to a variety of
countries (92,9% of total export value, 11,9% of exporters). Concentrated export activity in terms of
value in very few firms. Moreover, exporters are more productive than non-exporters, and experience
greater productivity improvements.
Global competition, challenges – greater economic integration of markets has the following effects:
- Increase demand for variety of products
- Increase size of market
- Increase intensity of competition
- Increase need of innovation
