1. Globalization

2. Objectives Describe the process of globalization
Explain how globalization affects markets and production
Identify two drivers of globalization
Summarize the globalization debate
List types of firms in international business
Describe the global business environment

3. Globalization Involves Us All
We experience international
transactions daily
Imports and exports reach
even remote areas
Technology and e-biz
promote trade
Consumers and companies
pull markets closer

4. International Business

5. Globalization of production
Trend toward greater economic, cultural, political and technological interdependence among national institutions and economies
Globalization of markets
Convergence in buyer preferences in markets around the world
Globalization of production
Dispersal of production activities worldwide to minimize costs or maximize quality

6. Benefits of Globalization
of markets
Globalization
of production
Reduces marketing costs
New market opportunities
Levels income stream
Access lower-cost labor
Access technical expertise
Access production inputs

7. Globalization Drivers I
Regional trade
agreements
GATT
WTO
Remove barriers to trade
and investment

8. Globalization Drivers II Technological Innovation
and videoconferencing
Internet, intranets,
and extranets
Transportation
advancements
Better coordination and control
Improved communications and management
More efficient, dependable shipping

9. Jobs and Wages Opponents Supporters Eliminates jobs in
developed nations
Lowers wages in
Exploits workers in
developing nations
Increases wealth and
efficiency everywhere
Generates labor market
flexibility in developed
countries
Advances economies
of developing nations

10. Labor, Environment, & Markets
Opponents
Supporters
Globalization lowers
labor standards
Weakens protection of
the environment
Exploits workers in
poor nations
Investment raises
labor standards
Open economies most
environment friendly
Companies concerned
for future markets

11. Income Inequality debate1
Inequality within nations
Poor people in developing nations benefit most from
an open economy 2 3
Inequality between nations
Nations open to world trade and investment grow faster than rich nations
Global inequality
Inequality has fallen, but experts disagree on the extent of the decline

12. National Sovereignty Opponents Supporters
Supranational institutions reduce autonomy of national, regional, and local governments
Supporters
Globalization has benefited societies by helping to spread democracy worldwide

13. Impact on Culture Opponents Supporters Destroys cultural diversity
Homogenizes our world
Bankrupts local small businesses
Supporters
Specialize and trade to obtain other goods
Import cultural goods from other nations
Protects deeper moral and cultural norms

14. International Business Players
Business that has direct investments abroad in multiple countries
Small companies and individuals becoming increasingly active in international trade and investment
Adopts a global perspective and engages in international business from or near its inception
Multinational
Corporation
Small Businesses
and Entrepreneurs
Born Global Firm

15. How They Stack Up
Comparing revenue of the world's 10 most global firms to the gross domestic product of nations