國際商務(wù)第三章

InternationalBusiness

9eByCharlesW.L.HillMcGraw-Hill/IrwinCopyright?2013byTheMcGraw-HillCompanies,Inc.Allrightsreserved.Chapter3PoliticalEconomyandEconomicDevelopmentWhatDeterminesACountry’sLevel

OfEconomicDevelopment?Grossnationalincome(GNI)perpersonmeasuresthetotalannualincomereceivedbyresidentsofanationJapan,Sweden,Switzerland,andtheU.S.havehighGNIChinaandIndiahavelowGNI

GNIcanbemisleadingbecauseitdoesnotconsiderdifferencesinthecostoflivingneedtoadjustGNIfiguresusingpurchasingpowerparity(PPP)HowDoCountries

CompareOnGNI?

EconomicDataforSelectCountriesWhatDeterminesACountry’sLevel

OfEconomicDevelopment?OfficialfigurescanalsobemisleadingbecausetheydonotaccountforblackeconomytransactionsInaddition,GNIandPPPdataarestaticanddonotconsidereconomicgrowthratesSo,whileChinaandIndiaarecurrentlycategorizedasbeingpoortheyaregrowingmorerapidlythanmanydevelopednationsandareexpectedtobecomeamongthelargesteconomiesintheworldHowDoCountries

CompareOnGrowthRates?

EconomicDataforSelectCountriesWhatDeterminesACountry’sLevel

OfEconomicDevelopment?Nobel-prizewinnerAmartyaSenargueseconomicdevelopmentshouldbeseenasaprocessofexpandingtherealfreedomsthatpeopleexperiencetheremovalofmajorimpedimentstofreedomlikepoverty,tyranny,andneglectofpublicfacilitiesthepresenceofbasichealthcareandbasiceducationAmartyaSenalsoclaimsthateconomicprogressrequiresthedemocratizationofpoliticalcommunitiestogivecitizensavoiceWhatDeterminesACountry’sLevel

OfEconomicDevelopment?TheUnitedNationsusedSen’sideastodeveloptheHumanDevelopmentIndex(HDI)whichisbasedonlifeexpectancyatbirtheducationalattainmentwhetheraverageincomesaresufficienttomeetthebasicneedsoflifeinacountryHowDoCountriesCompareonEconomicDevelopment?

EconomicDataforSelectCountriesHowDoesPoliticalEconomyInfluenceEconomicProgress?Innovationandentrepreneurshiparetheenginesoflong-runeconomicgrowthinnovationincludesnewproducts,newprocesses,neworganizations,newmanagementpractices,andnewstrategiesentrepreneurscommercializeinnovativenewproductsandprocessesInnovationandentrepreneurshiphelpincreaseeconomicactivitybycreatingnewmarketsandproductsthatdidnotpreviouslyexistinnovationinproductionandbusinessprocessesresultinmoreproductivelaborandcapitalfurtherboostingeconomicgrowthratesHowDoesPoliticalEconomyInfluenceEconomicProgress?Innovationandentrepreneurshiprequireamarketeconomythereislittleincentivetodevelopnewinnovationsinplannedeconomiesbecausethestateownsallmeansproductionandtherefore,thegainsThereisastrongrelationshipbetweeneconomicfreedomandeconomicgrowththesixcountrieswiththehighestratingsofeconomicfreedomfrom1975to1995werealsoamongthehighestforeconomicgrowthHongKong,Switzerland,Singapore,theUnitedStates,Canada,andGermanyHowDoesPoliticalEconomyInfluenceEconomicProgress?Innovationandentrepreneurshiprequirestrongpropertyrights withoutstrongpropertyrights,individualsandbusinessesriskhavingtheirinnovationsandpotentialprofitsstolenEconomistHernandodeSotoclaimsthatinadequatepropertyprotectioninmanydevelopingnationslimitseconomicgrowthHowDoesPoliticalEconomyInfluenceEconomicProgress?Democraticregimesareprobablymoreconducivetolong-termeconomicgrowththandictatorships,eventhebenevolentkindpropertyrightsareonlysecureinwell-functioning,maturedemocraciesSubsequenteconomicgrowthleadstotheestablishmentofdemocraticregimesSouthKoreaTaiwanHowDoesGeographyInfluenceEconomicDevelopment?Countrieswithfavorablegeographyaremorelikelytoengageintrade,andso,bemoreopentomarket-basedeconomicsystems,andtheeconomicgrowththeypromoteJeffreySachsstudiedeconomicgrowthratesbetween1965and1990andfoundthatlandlockedcountriesgrewmoreslowlythancoastaleconomiesbeingtotallylandlockedreducedacountry’sgrowthrateby0.7%peryeartropicalcountriesgrewmoreslowlythancountriesintemperatezonesHowDoesEducationInfluenceEconomicDevelopment?CountriesthatinvestineducationhavehighergrowthratesbecausetheworkforceismoreproductivecountriesinSoutheastAsiahaveoffsettheirgeographicaldisadvantagesbyinvestingineducationIndonesia,Malaysia,andSingaporeHowIsThePolitical

EconomyChanging?Sincethelate1980s,twotrendshaveemergedDemocraticrevolution(late1980sandearly1990s)democraticallyelectedgovernmentsreplacedtotalitarianregimesmorecommittedtofreemarketcapitalismAmoveawayfromcentrallyplannedandmixedeconomiesmorecountrieshaveshiftedtowardthemarket-basedmodelHowIsThePolitical

EconomyChanging?Trend1:Democracyhasspreadoverthelasttwodecadesmanytotalitarianregimesfailedtodelivereconomicprogresstothevastbulkoftheirpopulationsnewinformationandcommunicationtechnologieshavebrokendowntheabilityofthestatetocontrolaccesstouncensoredinformationeconomicadvancesofthelast25yearshaveledtoincreasinglyprosperousmiddleandworkingclasseswhohavepushedfordemocraticreformsHowFreeAre

CountriesPolitically?PoliticalFreedomin2010HowIsThePolitical

EconomyChanging?AuthorFrancisFukuyamaarguesthatthenewworldorderwillbecharacterizedbydemocraticregimesandfreemarketcapitalismBut,politicalscientistSamuelHuntingtonarguesthatwhilemanysocietiesaremodernizingtheyarenotbecomingmoreWesternpredictsaworldsplitintodifferentcivilizationsthesecivilizationswillbeinconflictwitheachother

HowIsThePolitical

EconomyChanging?Trend2:Thespreadofmarket-basedsystemsmorecountrieshavemovedawayfromcentrallyplannedandmixedeconomiestowardthemarket-basedmodelCommandandmixedeconomiesfailedtodeliverthesustainedeconomicgrowthachievedinmarket-basedcountriesHowFreeAre

CountriesEconomically?EconomicFreedomin2010WhatIsTheNatureOf

EconomicTransformation?

Theshifttowardamarket-basedsysteminvolvesderegulation–removinglegalrestrictionstothefreeplayofmarkets,theestablishmentofprivateenterprises,andthemannerinwhichprivateenterprisesoperateprivatization-

transferstheownershipofstatepropertyintothehandsofprivateinvestorsthecreationofalegalsystemtosafeguardpropertyrightsWhatDoesTheChanging

EconomyMeanForManagers?Marketsthatwereformerlyoff-limitstoWesternbusinessarenowopenfirmsneedtoexploreopportunitiesinthesemarketsDespitebeingunderdevelopedandpoor,somemarketshavehugepotentialChina-1.2billionpeopleIndia–1.1billionpeopleLatinAmerica–400millionpotentialconsumersWhatDoesTheChanging

EconomyMeanForManagers?However,thepotentialrisksarelargewilldemocracythriveespeciallyindifficulteconomictimes?willtotalitarianregimesreturn?willamulti-polarworldofdifferentcivilizationsemerge?willChina’sfinancialsystembestable?WhatAreTheImplicationsOfPoliticalEconomyDifferencesForManagers?Countrieswithdemocraticregimes,marketbasedeconomicpolicies,andstrongpropertyrightsprotectionaremorelikelytohavehighersustainedratesofeconomicgrowththesemarketsaremoreattractivetointernationalbusinessesthebenefits,costs,andrisksofdoingbusinessinacountryareafunctionofthecountry’spolitical,economic,andlegalsystemsWhatAreTheImplicationsOfPoliticalEconomyDifferencesForManagers?Thebenefitsofdoingbusinessinacountryareafunctionofthemarket’ssizethepurchasingpowerofitsconsumerstheirlikelyfuturewealthByidentifyingandinvestingearlyinpotentialfutureeconomicstars,firmsmaybeabletogainfirstmoveradvantages(advantagesthataccruetoearlyentrantsintoamarket)andestablishloyaltyandexperienceinacountryChinaWhatAreTheImplicationsOfPoliticalEconomyDifferencesForManagers?Thecostsofdoingbusinessinacountryareafunctionofitspoliticalsystemisitnecessarytopaybribestogetmarketaccess?economiclevelarethenecessarysupportingbusinessandinfrastructureinplace?legalsystemitcanbemorecostlytodobusinessincountrieswithdramaticallydifferentproduct,workplace,andpollutionstandards,orwherethereispoorlegalprotectionforpropertyrightsWhatAreTheImplicationsOfPoliticalEconomyDifferencesForManagers?TherisksofdoingbusinessinacountryareafunctionofPoliticalrisk-thelikelihoodthatpoliticalforceswillcausedrasticchangesinacountry'sbusinessenvironmentthatadve