Political and Legal Environment

Domestic, international and political environment impacts MNC.

When we make the above statement what do we mean? What is being impacted? Where are the areas that we see change or differences?

US government supports companies by providing information.

Is that a good use of government them?

Company Trade Reports

Ideologies and Political systems

What do you think a country’s ideology tell us about the political system they adopt? ..about how that system is supported?

The text talks about the complexity of dealing with the EU because of the individualistic and collectivist ideals. Why does this increase complexity?

What is the difference between nationalization of businesses and nationalism?

What are the positive and negatives of nationalism? Do the benefits outweigh the costs?

Do you think there are different consequences for nationalism in the US and China?

Principles of International Law

Sovereignty and Sovereign Immunity

Countries have the right to rule

International Jurisdiction

Nationality Principle

Retain jurisdiction over own citizens

Territoriality Principle

Retains jurisdiction within territory

Protective Principle

Retain jurisdiction over behavior threatens security

Doctrine of Comity

Respect for laws, institutions, and governments in reference to own citizens

Act of State Doctrine

Accepts acts of other countries even when in conflict with US

Treatment and Rights of Aliens

Forum for Hearing and Settling Disputes

Legal and Regulatory Issues

Foreign Corrupt Practices Act

1977 – address bribes in international business

How did the critics think this act would impact business? Did that turn out to be the case? Why do you think these results happened?

Foreign Corrupt Practices Act

Law.com Law Blog with examples of FCTPA

Bureaucratization

Privatization

National Center for Policy Analysis

MNC and Economies

MNC – Multinational Corporations

Characteristics that classify a company as a MNC?
1.
2.
3.

What MNC's did you find operating in your countries?
Surprises in your research.

Discuss Quiz in the text pg. 19


Global Economies and Main Systems

Market Economy

Command Economy

Mixed Economy

What worries would a company having entering a mixed economy that may not be as promient in the other 2 types?


World Regions

Discuss impact of NAFTA on MNC’s.

Why do MNC’s want to expand into Asia? What are some of the risks? Is it worth it? What are the assumptions behind this expansion?


Outshoring by India

India and China

Das talks about the response of the world to the rising power of India and China and the contrasting ways in which they have grown. Does the information in this article change you responses to the questions in the case?

Do you think the present economic uncertainties will increase the pressure to choose between India and China?

What information would you want to know before you decided in which country to invest?

The text was revised when oil was at an all time high. What impact does the change in the price of oil have on the assumptions about the future of emerging and developing regions?

What interesting observations or questions did you come up with based on the readings?

Homework for 1/28

Read: Luthans and Doh pgs 36 -46

Find a current article (2007 – present) in the press that discusses the Foreign Corrupt Practices Act.



Homework for 1/30

Read: Luthans and Doh pgs. 46 – 54

Quiz over Chpt 2

Read: A Chinese Venture pg. 57.

Globalization

Every morning in Africa, a gazelle wakes up.

It knows it must run faster than the fastest lion or it will be killed.

Every morning a lion wakes up.

It knows it must outrun the slowest gazelle or it will starve to death.

It doesn't matter whether you are a lion or a gazelle.

When the sun comes up, you better start running.

(African proverb - from Friedman, 2007)

Luthans and Doh define globalization as "the process of social, political, economic, cultural, and technological integration of countries around the world (8)."

Examples of these include:

mig33 ; Chinese milk Scandal; Satyam scandal; Sony losses


What are the benefits and costs of globalization for different sectors of the society? (companies, workers, communities)

For years we have seen the benefits of globalization, what risks did we overlook?

What ramifications will the economic downturn have on the pace of globalization?

Historical foundations of globalization.

Silk Road

Trans-Saharan Crosss-Continental trade

Agreements

Trade agreements - link to information about trade agreements.

Why do countires form trade agreements?

NAFTA
FTAA
ASEAN
CAFTA
EU


Changing World

BRIC - what countries compose this group? What is the importance of the group?

B Brazil
R Russia
I India
C China

International management requires a working knowledge of the forces involved in global business operations.

MNC

What constitutes classifying a company as a MNC?

What MNC's did you find operating in your countries?

Fortune Global List

The World is Flat

In Chapter 1, Luthans and Doh mention Thomas Friedman's book The World is Flat. In the book Friedman identifies 10 "flatteners" he believes are contributing to the current stage of globalization. This slideshow presents a good overview of those points.

The World is Flat

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