New User Special Price Expires in

Let's log you in.

Sign in with Facebook


Don't have a StudySoup account? Create one here!


Create a StudySoup account

Be part of our community, it's free to join!

Sign up with Facebook


Create your account
By creating an account you agree to StudySoup's terms and conditions and privacy policy

Already have a StudySoup account? Login here

International Business - Chapter 5

by: Anna Notetaker

International Business - Chapter 5 MGMT 4710

Marketplace > Middle Tennessee State University > Management > MGMT 4710 > International Business Chapter 5
Anna Notetaker
GPA 3.62

Preview These Notes for FREE

Get a free preview of these Notes, just enter your email below.

Unlock Preview
Unlock Preview

Preview these materials now for free

Why put in your email? Get access to more of this material and other relevant free materials for your school

View Preview

About this Document

Week 3
International Business
Cheryl Ward
Class Notes
25 ?




Popular in International Business

Popular in Management

This 3 page Class Notes was uploaded by Anna Notetaker on Thursday September 8, 2016. The Class Notes belongs to MGMT 4710 at Middle Tennessee State University taught by Cheryl Ward in Fall 2016. Since its upload, it has received 14 views. For similar materials see International Business in Management at Middle Tennessee State University.


Reviews for International Business - Chapter 5


Report this Material


What is Karma?


Karma is the currency of StudySoup.

You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!

Date Created: 09/08/16
International Business Week 3  Democracy is a political system in which citizens elect representatives to govern the country on their behalf. o President  Totalitarianism (dictatorship) is a political system in which one person or party exercises absolute political control. They entail higher political risks due to wars, riots, protest, etc. o Communist o Right-Wing (One political position) o Theocratic (One religion) o Tribal (African/Historical)  Civil Law – comprehensive statutes and codes as a primary means to form legal judgment.  Common Law – English origin, shaped by precedents and traditions from previous judicial decisions. (UNITED STATES)  Theocratic Law – based on religious teachings. ****80% of the world is a Civil Law, while the USA is Common Law****  Property Rights are the legal rights to use an economic property (resource) and to derive benefit from it. o Collateral for loans, Start-Ups, etc.  Intellectual Property Rights is known as IPR, which are the rights with the ownership of intellectual property, which are intangible products that result from intellectual activities like books, videos, etc. o TYPES of IPR: Patents, Copyrights, Trademarks  Market Economy is characterized by the “invisible hand” of market forces; government takes a hands-off, or laissez faire approach.  Command economy is when the government is taking the “commanding height” in the economy. All factors of production are government or state owned and controlled. All supply, demand, and pricing are planned by the government.  Mixed Economy is the elements of both market economy and command economy. o UNITED STATES  Ethnocentrism is a self-centered mentality held by a group of people who perceive their own culture, ethics, and norms as natural, rational, and morally right. o Poor attitude o My way is the best way  Context the underlying background upon which social interaction takes place. o Low context culture – communication is usually taken at face value without much reliance on unspoken context. o High context culture – communication relies a lot on the underlying unspoken contwxt, which is as important as the words used.  Dimension Approach: o Power Distance – extent to which less powerful members within a country expect and accept that power is distributed unequally (think social classes) o Individualism – idea that an individual’s identity is fundamentally his or her own. o Collectivism – idea that an individual’s identity is fundamentally tied to the identity of his or her collective group. o Masculinity/Femininity – dimension of sex role differentiation. o Uncertainty avoidance – extent to which members in a culture accept or avoid ambiguous situation and uncertainty. o Long-term orientation – how much emphasis is placed on perseverance and savings for future betterment.  Dimension Approach – focuses on multiple dimensions of cultural differences both within and across cultures.  Ethics is the principles, standards, and norms of conduct that govern individual and firm behavior.  Code of Conduct is a set of guidelines for making ethical decision.  Ethical Relativism follows the cliché – When in Rome, do as the Romans.  Three Core Principles – respect for human dignity and basic rights, respect for local traditions, and respect for institutional context.  Corruption – the abuse of public power for private benefits o Usually in the form of bribery, is cash or in kind.  Managers should enhance their cultural intelligence – an individual’s ability to understand and adjust to new cultures and managers should be aware of the prevailing norms and their transitions globally.  Exporting – selling abroad.  Importing – buying from abroad.  Merchandise – tangible products being traded.  Service – intangible services being traded.  Trade Deficit – when a nation imports more than it exports.  Trade Surplus – when a nation exports more than its imports.  Balance of Trade is whether a country has a trade surplus or deficit.  Mercantilism views international trade as a zero-sum game. o A nation that exported more than it imported would enjoy net inflow of money. o Intellectual ancestor of protectionism is the idea that governments should actively protect domestic industries from imports and promoted exports. o The main economic system used during the sixteenth to eighteenth centuries. The main goal was to increase a nation’s wealth by imposing government regulation concerning all of the nation’s commercial interests. It was believed the national strength could be maximized by limiting imports via tariffs and maximizing exports.  Absolute Advantage is with free trade, a nation gains by specializing in economic activities in which it has an absolute advantage (win-win game).  Free Trade is buying and selling of goods and services with little or no government intervention.  Opportunity Cost is what you have to give up in order to make a choice.  The theory of comparative advantage is when the nations should specialize in producing the good in which they have the lowest opportunity cost. In the end, people must also consider comparative advantage when deciding what goods to product and for whom to product them.  International Product Life Cycle Theory (IPLC) – dynamic theory that accounts for changes in the patterns of trade over time. o Introduction o Growth o Maturity o Decline  Tariff Barriers is the means of discouraging imports by placing a tariff (tax) on imported goods.  Non-tariff barriers (NTB) – discourages imports by means other than tariffs: o Subsidies o Import quotas – restriction on the quantity of a good that can be brought into a country o Voluntary export restraints – exporting countries voluntarily agree to restrict exports o Local content requirements – rules stipulating that a certain proportion of the value of the goods made in one country must originate from that country. o Administrative policies – bureaucratic rules that make it harder to import o Antidumping duties – cost levied on imports that have been sold below cost  Trade Embargo is when there is a politically motivated trade sanction against foreign countries to signal displeasure.


Buy Material

Are you sure you want to buy this material for

25 Karma

Buy Material

BOOM! Enjoy Your Free Notes!

We've added these Notes to your profile, click here to view them now.


You're already Subscribed!

Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'

Why people love StudySoup

Jim McGreen Ohio University

"Knowing I can count on the Elite Notetaker in my class allows me to focus on what the professor is saying instead of just scribbling notes the whole time and falling behind."

Allison Fischer University of Alabama

"I signed up to be an Elite Notetaker with 2 of my sorority sisters this semester. We just posted our notes weekly and were each making over $600 per month. I LOVE StudySoup!"

Jim McGreen Ohio University

"Knowing I can count on the Elite Notetaker in my class allows me to focus on what the professor is saying instead of just scribbling notes the whole time and falling behind."


"Their 'Elite Notetakers' are making over $1,200/month in sales by creating high quality content that helps their classmates in a time of need."

Become an Elite Notetaker and start selling your notes online!

Refund Policy


All subscriptions to StudySoup are paid in full at the time of subscribing. To change your credit card information or to cancel your subscription, go to "Edit Settings". All credit card information will be available there. If you should decide to cancel your subscription, it will continue to be valid until the next payment period, as all payments for the current period were made in advance. For special circumstances, please email


StudySoup has more than 1 million course-specific study resources to help students study smarter. If you’re having trouble finding what you’re looking for, our customer support team can help you find what you need! Feel free to contact them here:

Recurring Subscriptions: If you have canceled your recurring subscription on the day of renewal and have not downloaded any documents, you may request a refund by submitting an email to

Satisfaction Guarantee: If you’re not satisfied with your subscription, you can contact us for further help. Contact must be made within 3 business days of your subscription purchase and your refund request will be subject for review.

Please Note: Refunds can never be provided more than 30 days after the initial purchase date regardless of your activity on the site.