國際商務(wù)第三章

1、International Business 9eBy Charles W.L. HillMcGraw-Hill/Irwin Copyright 2013 by The McGraw-Hill Companies, Inc. All rights reserved.Chapter 3Political Economy and Economic Development3-3What Determines A Countrys Level Of Economic Development? Gross national income (GNI) per person measures the tot

2、al annual income received by residents of a nation Japan, Sweden, Switzerland, and the U.S. have high GNI China and India have low GNI GNI can be misleading because it does not consider differences in the cost of living need to adjust GNI figures using purchasing power parity (PPP) 3-4How Do Countri

3、es Compare On GNI? Economic Data for Select Countries3-5What Determines A Countrys Level Of Economic Development? Official figures can also be misleading because they do not account for black economy transactions In addition, GNI and PPP data are static and do not consider economic growth rates So,

4、while China and India are currently categorized as being poor they are growing more rapidly than many developed nations and are expected to become among the largest economies in the world 3-6How Do Countries Compare On Growth Rates? Economic Data for Select Countries3-7What Determines A Countrys Lev

5、el Of Economic Development?Nobel-prize winner Amartya Sen argues economic development should be seen as a process of expanding the real freedoms that people experience the removal of major impediments to freedom like poverty, tyranny, and neglect of public facilitiesthe presence of basic health care

6、 and basic educationAmartya Sen also claims that economic progress requires the democratization of political communities to give citizens a voice3-8What Determines A Countrys Level Of Economic Development? The United Nations used Sens ideas to develop the Human Development Index (HDI) which is based

7、 on life expectancy at birth educational attainment whether average incomes are sufficient to meet the basic needs of life in a country 3-9How Do Countries Compare on Economic Development? Economic Data for Select Countries3-10How Does Political Economy Influence Economic Progress?Innovation and ent

8、repreneurship are the engines of long-run economic growthinnovation includes new products, new processes, new organizations, new management practices, and new strategiesentrepreneurs commercialize innovative new products and processes Innovation and entrepreneurship help increase economic activity b

9、y creating new markets and products that did not previously exist innovation in production and business processes result in more productive labor and capital further boosting economic growth rates 3-11How Does Political Economy Influence Economic Progress?Innovation and entrepreneurship require a ma

10、rket economythere is little incentive to develop new innovations in planned economies because the state owns all means production and therefore, the gainsThere is a strong relationship between economic freedom and economic growththe six countries with the highest ratings of economic freedom from 197

11、5 to 1995 were also among the highest for economic growthHong Kong, Switzerland, Singapore, the United States, Canada, and Germany 3-12How Does Political Economy Influence Economic Progress?Innovation and entrepreneurship require strong property rights without strong property rights, individuals and

12、 businesses risk having their innovations and potential profits stolenEconomist Hernando de Soto claims that inadequate property protection in many developing nations limits economic growth3-13How Does Political Economy Influence Economic Progress?Democratic regimes are probably more conducive to lo

13、ng-term economic growth than dictatorships, even the benevolent kindproperty rights are only secure in well-functioning, mature democracies Subsequent economic growth leads to the establishment of democratic regimesSouth KoreaTaiwan 3-14How Does Geography Influence Economic Development?Countries wit

14、h favorable geography are more likely to engage in trade, and so, be more open to market-based economic systems, and the economic growth they promoteJeffrey Sachs studied economic growth rates between 1965 and 1990 and found that landlocked countries grew more slowly than coastal economiesbeing tota

15、lly landlocked reduced a countrys growth rate by 0.7% per year tropical countries grew more slowly than countries in temperate zones 3-15How Does Education Influence Economic Development?Countries that invest in education have higher growth rates because the workforce is more productivecountries in

16、Southeast Asia have offset their geographical disadvantages by investing in educationIndonesia, Malaysia, and Singapore3-16How Is The Political Economy Changing?Since the late 1980s, two trends have emergedvDemocratic revolution (late 1980s and early 1990s)democratically elected governments replaced

17、 totalitarian regimes more committed to free market capitalismvA move away from centrally planned and mixed economiesmore countries have shifted toward the market-based model3-17How Is The Political Economy Changing?Trend 1: Democracy has spread over the last two decadesmany totalitarian regimes fai

18、led to deliver economic progress to the vast bulk of their populationsnew information and communication technologies have broken down the ability of the state to control access to uncensored informationeconomic advances of the last 25 years have led to increasingly prosperous middle and working clas

19、ses who have pushed for democratic reforms 3-18How Free Are Countries Politically?Political Freedom in 20103-19How Is The Political Economy Changing?Author Francis Fukuyama argues that the new world order will be characterized by democratic regimes and free market capitalismBut, political scientist

20、Samuel Huntington argues that while many societies are modernizing they are not becoming more Western predicts a world split into different civilizations these civilizations will be in conflict with each other 3-20How Is The Political Economy Changing? Trend 2: The spread of market-based systems mor

21、e countries have moved away from centrally planned and mixed economies toward the market-based model Command and mixed economies failed to deliver the sustained economic growth achieved in market-based countries3-21How Free Are Countries Economically?Economic Freedom in 2010 3-22What Is The Nature O

22、f Economic Transformation?The shift toward a market-based system involvesderegulation removing legal restrictions to the free play of markets, the establishment of private enterprises, and the manner in which private enterprises operate privatization - transfers the ownership of state property into

23、the hands of private investorsthe creation of a legal system to safeguard property rights3-23What Does The Changing Economy Mean For Managers?Markets that were formerly off-limits to Western business are now openfirms need to explore opportunities in these marketsDespite being underdeveloped and poo

24、r, some markets have huge potential China -1.2 billion people India 1.1 billion peopleLatin America 400 million potential consumers3-24What Does The Changing Economy Mean For Managers?However, the potential risks are largewill democracy thrive especially in difficult economic times?will totalitarian

25、 regimes return?will a multi-polar world of different civilizations emerge?will Chinas financial system be stable? 3-25What Are The Implications Of Political Economy Differences For Managers? Countries with democratic regimes, market based economic policies, and strong property rights protection are

26、 more likely to have higher sustained rates of economic growth these markets are more attractive to international businesses the benefits, costs, and risks of doing business in a country are a function of the countrys political, economic, and legal systems 3-26What Are The Implications Of Political

27、Economy Differences For Managers?The benefits of doing business in a country are a function of the markets sizethe purchasing power of its consumerstheir likely future wealth By identifying and investing early in potential future economic stars, firms may be able to gain first mover advantages (adva

28、ntages that accrue to early entrants into a market) and establish loyalty and experience in a countryChina3-27What Are The Implications Of Political Economy Differences For Managers?The costs of doing business in a country are a function of itspolitical systemis it necessary to pay bribes to get mar

29、ket access?economic levelare the necessary supporting business and infrastructure in place?legal systemit can be more costly to do business in countries with dramatically different product, workplace, and pollution standards, or where there is poor legal protection for property rights 3-28What Are The Implications Of Political Economy Differences For Managers? The risks of doing business in a country are a function of Political risk - the likelihood that political forces will cause drastic changes in a countrys business environment that adv