国际商务_International Business _chapter_4.pptVIP

The Economic Background of IB Course Structure Introduction to IB Globalisation Economic Background of IB Cultural, Political Legal Issues in IB Emerging Markets Global Strategy in IB Key Functions in IB Economic Background Trade and Investment Currency Markets the International Financial System Government Intervention Regional Economic Integration Foundation Concepts II Comparative advantage (use definition on p.94, NOT p.90)Country A is said to have a comparative advantage in the production of a good X compared to Country B if the opportunity cost of producing X in terms of another good Y is less in Country A than Country B Economic Models Useful simplifications of reality Economies of ScaleThe production of a good X is said to show economies of scale if unit cost falls as output increases. (Often due to high fixed costs) Product Life Cycle II Motives for FDI: Ch.14, 397-401 Market-seeking motives Gain access to new markets; follow key customers; compete with rival in their own markets Resource or asset-seeking motives Access raw materials; gain access to knowledge; access technological or managerial know-how Efficiency-seeking motives Reduce sourcing/production costs; produce near customers; government incentives; trade barriers Always the aim is to increase profits Key Features of FDI: Ch.14, 397-401 Greater resource commitment Local presence and operations May help obtain global scale efficiency Involves substantial risk and uncertainty Must deal more intensively with local social and cultural variables Address issues of social responsibility, especially re local environmental and labor laws International Business: Strategy, Management, and the New Realities * FDI BASED EXPLANATIONS: Dunning’s Eclectic Paradigm Three conditions determine whether or not a company will internationalize via FDI: Ownership-specific advantages – knowledge, skills, capabilities, relationships, or physical assets that form the basis for the firm’s competitive advantage