Today 6e by Charles W. M. Hill Chapter 1 The positive effect Introduction On the globe economy today, we see • fewer self-contained national economies with excessive barriers to cross-border trade and expenditure • a more integrated global economic system with lower boundaries to trade and expense • about $4 trillion in foreign exchange transactions taking place everyday • (in 2012) over $18. 2 trillion of goods plus some $3. five trillion of services offered across countrywide borders • the business of international institutions ttp: //www. ge. com/ http://www. ikea. com/ Chapter one particular: Globalization Effects of globalization is seen everywhere: • the cars persons drive • the food people eat • the jobs where people function • the clothes people wear • Chapter you: Globalization PRECISELY WHAT IS GLOBALIZATION? • Globalization refers to the move towards a much more integrated and interdependent community economy.
Two key aspects: • the globalization of markets • the globalization of production Chapter 1: Globalization The Globalization of Markets /14/2013 1 several 8 on the lookout for Globalization of markets: the truth that in several industries historically distinct and separate nationwide markets are merging as one huge global marketplace where the tastes and preferences of consumers in different nations are beginning to converge after some global norm.
Examples: – Smart Phones (iPhone, Android, etc . ) & Apps – Coca-Cola/ Starbucks- McDonald’s hamburgers – Apple iPad/ The samsung company Tablet- IKEA furniture Part 1: The positive effect The Globalization of Creation
Globalization of production: is a tendency among various firms to source services and goods from different locations around the world to take advantage of countrywide differences in the price and quality of factors of production (such as property, labor, capital, and energy), thereby allowing them to compete more effectively against their very own rivals. Good examples: http://www. vizio. com/ BoeingLenovoVizio (B787: 65% outsourced) (design: US; circumstance, keyboard, HIGH-DEFINITION: Thailand; http://www. oeing. com/newairplane/display, memory: H. Korea; Wi-Fi: Malaysia; ass’y: Mex. ) http://www. lenovo. com/planetwide/select/selector. code Chapter 1: Globalization THE EMERGENCE OF WORLDWIDE INSTITUTIONS Global institutions: • help control, regulate, and police the global market place • promote the establishment of multinational treaties to control the global business system Standard Agreement on Tariffs and Trade (GATT) after WORLD WAR II Chapter you: Globalization 2/14/2013 2