International Business Midterm

The shift towards a more integrated and interdependent world economy
-ex: global financial crisis

-Globalization of markets: opening markets
-the merging of distinctly separate national markets into a global marketplace
=tastes and preferences converge onto a global norm (ex: McDonalds)
=firms offer standardized products worldwide creating a world market
-signficant differences still exist between national markets on many relevant dimensions
-these differences require that marketing and operating strategies and product features be customized to best match
conditions in a country
-There are still significant differences:
=range of problems are wider and more complex
=government intervention in trade and investment creates problems
=international investment is impacted by different currencies

-Globalization of production:
-refers to sourcing of goods and services from locations around the world to take advantage of the differences in cost or quality of the factors of production (labor, land, capital)

-created need for global institutions to help manage, regulate, and police the global marketplace (GATT, WTO, IMF, World Bank, United Nations)

-decline in trade barriers
-technological change