Blades, Inc., could obtain from DFI.
Companies such as Blades, Inc. often opt to engage in DFI out of a desire to take advantage of lower labor costs abroad. In the case of Thailand, the nation is less economically developed than Britain, where Blades, Inc. is based. Additionally, due to the depreciation of the baht, labor costs will be even cheaper in Thailand. The location of Thailand has additional financial incentives for Blades given the costs it could save on shipping raw material. Blades currently imports components from Thailand because of the relatively low price and high quality of rubber and plastic components.
Thailand consumers already enjoy Blades' product. Thus, having Blades within the country is a win-win situation, allowing it to save on both labor and shipping costs. Establishing the company within the nation's borders is likely to increase the company's profile and deepen its hold upon Thailand's burgeoning…… [Read More]
respect to macroeconomic variables, was India an attractive site for foreign direct investment in 2012?
India has become one of the most attractive prospects for long-term economic foreign investment. According to Ernst & Young, despite an overall softening economy during the 2011-2012 economic period: "India remained very attractive for FDI in 2011. FDI projects increased by 20% in India in 2011, attracting 932 projects, which created an estimated 255,416 jobs" (Ready for the transition, Ernst & Young: 4). In fact, the economic uncertainty may have actually worked in India's favor. India is widely regarded as a place which has a technologically astute, highly trained workforce. Labor costs are low, the government is open to foreign investment in terms of its legal infrastructure, and the workforce is culturally attenuated to the attitudes of the est. The fact that English is the language that unites India is another bonus factor. "Investors came…… [Read More]
One of the main benefits that Blades would get from foreign direct investment in Thailand is an operating hedge. The company is currently buying components from Thailand that are priced in baht, and selling to an importer in Thailand who is paying in baht. To an extent, this forms something of an operating hedge, but the components are going to the U.S. first, creating foreign exchange exposure. FDI would help to reduce this exposure. In addition, FDI could potential help reduce the company's political risk, at least if it retains a strong local partner. In many countries, a local partner is essential to reducing political risk and Thailand is no exception.
A third potential advantage is that FDI would give the company long-term exposure to Thailand at a relatively low price. Blades would also enjoy whatever first move advantages might accrue. Lastly, the company would gain a manufacturing foothold…… [Read More]
S. billion in 1998. eported as the dominant source of inward FDI in China is that of Hong Kong, followed by Japan, the U.S. And Taiwan.
Summary and Conclusion
This study set out to examine Foreign Direct Investment in China by the multinational enterprise. At present China is a primary source for foreign direct investment due to the favorable laws and regulations governing Foreign Direct Investment in China and the attempt to make location siting of the organization equitable and fair. China has been attempting to pull the company in line with their own expectations as have the multinational enterprises who desire to directly invest foreign funds into China.
Investment (2008) Multinational Corporations. Cush & Wakefield. etrieved from: http://www.cushwake.com/cwglobal/jsp/audienceDetail.jsp?audienceId=18&Country=900095&Language=EN&groupBy=audience
Kroll, CA and Bardhan, a. (2007) Globalization and the eal Estate Industry: Issues, Implications, Opportunities Haas School of Business, UC Berkeley, Paper Prepared for the Sloan Industry Studies Annual Conference.…… [Read More]
In addition, a series of joint ventures in which West German steel firms joined with East German firms and Krupp, Klockner, and Thyssen of Germany was pursuing other developmental initiatives in eastern Europe as well. Likewise, Arbed of Luxemburg was involved in steelmaking facilities in the former East Germany. According to Mangum et al., "The rising market for improved galvanizing for automobiles, appliances, canning, and other uses is producing a rash of joint ventures throughout the world. Some of these are internal to various countries and others involve international partners" (p. 74).
As a result, nearly 30% of the world's steel supply is now produced by plants belonging to companies that did not exist just 3 decades ago (Ahlberg, Pitkanen & Storsch 1999). As these authors point out, "Such upstarts have entered a global market that since 1980 has grown by less than 1% a year -- an average combining…… [Read More]
This would play a role in helping to bring the Czech Republic into the EU in 2004. The effect that this would have on the Prague Stock Exchange is that it would cause it to rise to 1,940. At which point, it would have a severe down trend economy during 2008 and into 2009. The only difference is: that the various reforms and economic policies that the government was using at the time, helped to contribute to mitigating the effects of the slowdown (as the economy would experience a less severe economic contraction of 3.4%). ("Czech Republic")
The price movements of the Slovak equity market in the last 10-15 years
The ratislava Stock Exchange was founded in 1991 and has been in operation since 1993. ("asic Information") Like what occurred in the Czech Republic the Slovak stock market went through two bear markets that would last until 1998 -- 1999.…… [Read More]
Foreign Corrupt Policies Act
Foreign Corrupt Practices Act and its Effects on U.S. Business
The Foreign Corrupt Practices Act (FCPA) of 1977 was a ground-breaking step that the U.S. government took in order to deal with the increasing awareness of the amount of inappropriate payments that were taking place overseas. If truth be told, it wasn't that the American companies were exclusively practicing such offensive acts. However, America was the first country that tried and outlined its international interest (Harris, 2011). The Foreign Corrupt Practices Act makes "any act done in furtherance of an offer, payment, promise to pay, or authorization of the payment of any money, or offer, gift, promise to give, or authorization of the giving of anything of value" illegal (Dorman & Martin, 2007).
Many critics inspect the FCPA in an unorthodox manner by considering it an interruption to the performance of American businesses running abroad. On…… [Read More]
Wiles (2003) note ways in which Chinese practices of technical communication are affecting foreign businesses operating in China and some of the Western methods that China has to learn to be effective. Specifically, Wiley notes how Western companies have developed single-souring skills that the Chinese will have to adopt to be successful in technical communication. Chinese culture is a high-context culture in which information is more tacit and less explicit, and Chinese culture therefore places less focus on the user. The explicit nature of Western communication works in the Chinese context because it is based on making the user understand, and the Chinese will have to adopt this same approach in order to trade with the West, where the user wants to be the center of attention and wants to be informed directly.
A report by Anthony (2003) also suggests that China's business culture is being changed by foreign…… [Read More]
The banking industry in China is essentially run by the state. All of the major banks are state-owned enterprises, and all are heavily regulated by the central government There is a central bank, the People's Bank of China, and a regulator for merchant and retail banks. There are13 national-level banks along with over one hundred city-level banks. Most banks today compete with each other, even if they had niches when they were founded -- for example, the names Construction Bank, Agricultural Bank, etc. reflect the roots of those banks, but they have long since expanded out of those niches. But because they are all state-owned banks that are ultimately overseen by the central government, they do not compete intensely with each other.
The biggest factor that attracts foreign banks to China is the size of the market. Even though there are many restrictions for foreign banks in China,…… [Read More]
Foreign Policy of China (Beijing consensus)
Structure of Chinese Foreign Policy
The "Chinese Model" of Investment
The "Beijing Consensus" as a Competing Framework
The U.S.-China (Beijing consensus) Trade Agreement and Beijing Consensus
Trading with the Enemy Act
Export Control Act.
Mutual Defense Assistance Control Act
The 1974 Trade Act.
The Operational Consequences of Chinese Foreign Policy
The World Views and China (Beijing consensus)
The Managerial Practices
Self Sufficiency of China (Beijing consensus)
China and western world: A comparison
The China (Beijing consensus)'s Policy of Trading Specialized Goods
The versions of China (Beijing consensus)'s trade development
The China (Beijing consensus) Theory of Power Transition
Foreign Policy of China (Beijing consensus)
ACD arms control and disarmament
ACDA Arms Control and Disarmament Agency
ADB Asian Development Bank
ADF Asian Development Fund
APEC Asia-Pacific Economic Cooperation
AF ASEAN [Association of Southeast…… [Read More]
Foreign Monetary System
A monetary system is any structure initiated by the government and mandated to issue currency, acknowledged as the medium of exchange by its citizens and governments of other nations. The central bank manages the monetary system of a country; this same bank has the responsibility of printing money and controlling the economy. Since the colonial period, coins from the European colonies had circulated in all the colonies. The Spanish coins gained dominance due to the scarcity of coins, during this time; the main form of trade was barter trade. The trade-involved items such as rice, tobacco, or animal skins, which took the form of money paper and notes, had varying rates of discount in different colonies rendering them of very low value (onald & Wright, 2006).
The high population in the U.S. called for increased trade and commerce. This forced the United States government to look for…… [Read More]
41 in the next three years. The current price for al-Mart implies strong growth prospects. The company does have a sound strategy to retain its new customers and refocus growth efforts on less-saturated markets overseas.
In short, while there can be little doubt as to al-Mart's operational excellence, it is not necessarily a great investment. Growth has in recent years been of the slow and steady variety. The company's present valuation may be symptomatic of its status as a safe haven for investors during tough economic times. This means that the growth implied by its current share price may not be justified. Therefore, while al-Mart is a great company to own, it may not be the best investment at its current price and with the market beginning to show signs of recovery. The 0.20 beta and historic low volatility mean that al-Mart shareholders will not reap the benefits of market…… [Read More]
usinesses experience profit cycles implying that market fluctuations are inevitable in an economy. Market demand plays a crucial role in the profitability of an enterprise and consequently affects the investment trend. A profitable firm is more likely to invest money to improve production facilities or to extend its business into other domains. Investors will analyze the profitability of any undertaking and only if the expected revenue is greater than the cost of capital will they invest in the project. Keynesian theory also states that the Marginal efficiency of Capital is inversely related to investment. "[t]o induce new investment 'the rate of return over cost must exceed the rate of interest'. [Richard C.. Johnsson] For all businesses profit is the ultimate motivation and any new venture is undertaken only if the internal rate of return is above the cost of capital defined by the prevailing rate of interest. Hence…… [Read More]
GM's Chevy Volt and its all-electric design, as well as diesel-electric and conventional gas-electric hybrids could and must replace the image of the 'old' GM in the public's imagination. The company has shed the Hummer stigma, now it must create a new image for itself in the future, not just domestically, but internationally.
Gas-free cars future priority. (2009, April 20). China Daily. Retrieved August 6, 2009
General Motors. (2009). Company history. Updated August 4, 2009. The New York Times.
Retrieved August 6, 2009.
Hu, Lei. (2008). GM's joint venture is China's top-selling brand in 2007. Edmunds.
Retrieved August 6, 2009.
Jason. (2004). The global hybrid race: Is Europe catching the fever. GreenHybrid. Retrieved August 6, 2009 at http://www.greenhybrid.com/wiki/index.php/The_Global_Hybrid_Race:_Is_Europe_Catching_The_Fever%3F
ald, Matthew. (200, August 5) $2 million in grants to speed up electric car manufacturing.
The New York Times. Retrieved August 6, 2009.
Ying, Tina &…… [Read More]
Foreign Corrupt Practices Act: What it Is and What it Does
The Foreign Corrupt Practices Act of 1977 as amended was passed in response to the discovery of numerous corporate misdeeds, including accounting irregularities, by Northrop, Lockheed, Gulf Oil by the Watergate special prosecutor and a subsequent investigation by the Securities and Exchange Commission that found these practices were prevalent in American business, including nearly a quarter of the Fortune 500 companies. This paper provides a review of the relevant literature to determine the rationale in support of the passage of the Foreign Corrupt Practices Act and what it prohibits. An analysis concerning the impact that the Act has had on American business at the national and international level is followed by a discussion concerning penalties for violations of the Act. An assessment of the impact on U.S. commerce is followed by a discussion concerning enforcement responsibility for the Act…… [Read More]
These types of investments are often illiquid, so the investor needs to view them as long-term investments. However, the lack of liquidity also means that for the most part they have low levels of correlation with the broad market.
Derivatives are another possibility, and their potential impact on the portfolio will be discussed in the next question. They can either increase risk or decrease risk, depending on the type of derivative and how it is used.
Overall, the impact of alternative investments is to reduce the degree to which the portfolio is subject to the equity and fixed income markets. Alternative investments are often used as an ancillary component of the portfolio, to reduce the portfolio's overall volatility but with the hopes that returns will not suffer as a result.
3. Derivatives can be used for a couple of different purposes in a portfolio. The first is to increase leverage…… [Read More]
In the future, this could result in some kind of major restructuring to deal with these issues. The problem is that these changes will occur when the company is facing greater challenges. This will hurt their competitive position, profit margins, stock performance and brand image. The above information will impact an investor's decision, by making them more cautious about purchasing the company over the long-term. ("The Coca Cola Company," 2012) ("Pepsi Co," 2012)
As far as Pepsi Co is concerned, the management has taken a continuing focus on expanding into new areas. This has resulted in the company owning different food, beverage and snack manufacturers. In these situations, the firm is concentrating on the impact that key acquisitions will have on Pepsi and its ability to enter new markets. ("The Coca Cola Company," 2012) ("Pepsi Co," 2012)
This strategy has proven to be highly successful. As the company is able…… [Read More]
One of the more popular analytical methods that is used with MT4 that is used to coordinate share trades is based on the Fibonnaci series (each number in this series except one is the product of the preceding two numbers; i.e., 1, 2, 3, 5, 8, 13 & #8230;). This Fibonacci series is used in quantitative trading systems such as MT4 to help traders modify their investments in real-time as the market changes as described further below.
The Fibonacci series can be found throughout nature in the way a pinecone grows when viewed from above or the patterns in a seashell such as the nautilus. Humans have a natural affinity for the Fibonacci series which is also known as the "Golden atio" because it provides an aesthetic that is pleasing to humans (Gelet, 2009). Also pleasing to humans is the power of the Fibonacci series to help manage…… [Read More]
Foreign business environment: Columbia
A. What events (political, economic, and technological) are the most important in recent years that might have impacted the business culture in Colombia?
Individuals who perceive Colombia as still being paralyzed by crime networks and drug cartels are skeptical and bewildered by the notion of a confederation of politicians, business leaders, and academicians visiting the nation. However, in reality, the situation in Colombia is far different from what it was a mere ten years ago.
Colombia’s infamous cruel and powerful drug cartels emerged during the latter part of the seventies era and developed in the subsequent two decades. Specifically, the Cali Cartel and Pablo Escobar’s Medellín Cartel were politically, socially and economically influential in the nation in this period. During the last two decades of the twentieth century, the world regarded the nation as being well on its way to becoming a failure as a state.…… [Read More]
There are numerous effects of corruption on MNCs. In case their competition engages in such practices, their activity is significantly influenced by this phenomenon. This is because their corrupt competitors can change rules and regulations that do not favor other companies. Therefore, they have to deal with the effects of such situations. This sometimes determines them to modify their activity.
In addition to this, there are situations where employees of certain MNCs are bribed by competitors in order to provide important information on these companies. This is extremely harmful to companies as it can lead to information leaks on strategies, price levels, and other types of investments that these companies intend to make. This means that these MNCs must increase investments in security issues.
In addition to this, MNCs are sometimes forced to become corruptors because some of their competitors do so. In other words, if certain companies provide incentives…… [Read More]
This also implies inadequacies in fiscal sustainability, which influences investments in private sectors.
The second channel happens through the level, composition and quality involved within the public investment, which shows the level at which the public investment replaces the private investments (Schmidt- Hebbel, Serven, & Solimano, 1996).
The final channel regards the level of taxation on the corporate earnings and the rules applicable in depreciations.
There have been arguments that fiscal policy and public expenditure reduces the private investments in two different manners. These include increasing the interest rates or lowering the private funds involved in financing the investments.
According to the neoclassical theory, the interest rate is also an imperative variable in finding the level of investment. Consequently, it results into a negative effect because it upsurges the interest payable in investments. Concurrently, McKinnon and Shaw, contends that this is likely to cause a positive relationship between the investment…… [Read More]
When this happens, the standard of living and income levels will remain stagnant. (Bhargava, 2006, pp. 341 -- 362) (Cazurra, 2008, pp. 12 -- 27)
Moreover, corruption will increase the costs of doing business inside a particular area. This is troubling, as it will lead to less employers relocating to the region. Instead, they will seek out locations where there are lower amounts of corruption. This is a part of an effort to keep their costs as low as possible so that they can increase their overall returns and remain competitive in the global marketplace. For the region, this will result in less high paying jobs (which helps contribute to an increase in the unemployment rate). (Bhargava, 2006, pp. 341 -- 362) (Cazurra, 2008, pp. 12 -- 27) (Heineman, 2006, pp. 75 -- 86)
How can MNCs deal effectively with these problems?
The ways that MNCs are able to deal…… [Read More]
Ethics: Foreign Corrupt Practices Act
The main thrust of the readings
The readings focus on the U.S. statutes prohibiting U.S. companies, citizens, and employees from issuing any valuable thing to foreign government executives for securing business benefits. The underlying thrust of the readings is twofold: first, that corruption must be deterred and second that government officials must promote economic relationships between their companies and foreign firms through the promotion of ethical foreign investment.
The rigid enactment of the FCPA has placed these two thrusts in a state of tension. Law enforcers and courts could interpret the readings broadly. For instance, any valuable thing includes not just payments in cash but also meals, gifts, entertainment and drinks. This element is not associated with any de minimis value and makes companies uncertain when they are expected to comply with the FCPA. From the readings, the FCPA has been enforced and institutes criminal…… [Read More]
Investment and Trade Over the Next 30 Years
Perhaps the most notable trend in recent economic history has been the falling-away of the influence of the G7 nations of United States, Japan, Germany, ritain, France, Canada and Italy and the explosion of economic clout in the developing world (What is the G7, 2012, Wise Geek). All eyes are looking to China, in terms of the trending of trade and investment patterns. China is the world's largest potential market, and still has untapped growth in terms of its vast consumer marketplace. That is why the Chinese economy is often seen as a barometer of the health of global demand. For example, in the last quarter, "trade was a net drag on growth last year as the world's second biggest economy turned in its slowest rate of expansion since 2009, at 9.2 per cent, with each quarter's growth in 2011 successively weaker…… [Read More]
The State is just taking back its rightful property under the contractual obligations of the agreement signed between the host State and the foreign investor who' assets are being seized in the expropriation. Another cause for direct expropriation is the concept that the State will in some way gain financially, socially, or economically from the expropriate assets beyond their value of compensation. If a particular investment can generate more positive results in the hands of the State, it is legal to file expropriation proceedings if the full value of compensation is covered as determine by an international tribunal.
In the European Union, direct expropriations are most common. Based on a common peace and favorable diplomatic relations between the countries within the European Union, there is little need for many investors to worry about unlawful and forceful expropriation, as seen in developing or communist nations. Some investors may invest within a…… [Read More]
Yet, what is important to accomplish at this stage is the presentation of the direct effects of the foreign direct investments. If these impacts materialize in growths of the Panamanian economy, it will be safe to conclude that the country reveals an efficient bi-direction foreign direct investment system. In this order of ideas, the following lines reveal some of the most notable impacts of FDIs onto Panama's socio-economic status (they are written in bulleted form to increase readability and clarity):
The first and foremost important impact was given by the massive investments made in the enlargement of the Panama Canal; the effects of such an endeavor were tremendous. On the one hand, the enlarged canal offered greater opportunities for traffic, which in turn materialized in greater revenues from offering services in the canal. Then, this enlargement translated into an increased demand for workforce, which in turn created new jobs, reduced…… [Read More]
For instance, McDonald's has a solid partnership with Starbucks that came as a natural solution to the increased consumption of coffee in its restaurants. Starbucks happens to be the world's leading specialty coffee retailer with a worldwide presence that matches that of the fast food producer.
Other factors affecting decision
Vietnam is an Asian country with strong oriental cooking habits, which might not be very compatible with McDonald's typical menu of cheeseburgers and fries with a Coke on the side. Furthermore, the local food seems to be relatively healthy, which again is not something that cam be said by McDonald's food.
In 1990s, the company tried to enter this market, but didn't due to the lack of suitable business partners. A few years later, KFC and Lotteria entered the market and consolidated their position. Therefore, at this point the restaurant chain would need a couple of strong breakthrough strategies…… [Read More]
Again, the press is not aware of all that goes on in the White House behind closed doors. Just because the matter was not publicly mentioned again in a direct fashion, does not mean that it was dropped. My team and I have continually discussed the best course of action for fostering trade with Tunisia and setting a much stronger precedent in the Middle East. The WSJ has actually zeroed in on the connection between this injection of fiscal support to Tunisia and our intentions to foster free trade with the entire Middle East.
The WSJ thinks that we should strike a trade deal with Tunisia and to also designate as a strategic economic nation. I and the entire White House is flattered that the Wall Street Journal would give us such obvious and prosaic advice on plans that we've already come up with ourselves. Of course the U.S. is…… [Read More]
Though this research will not provide all necessary data for such a project to be undertaken, it will explore the issue form a side and perspective not often utilized, shedding light on an essential yet often-overlooked aspect of the foreign trade relationship.
Qualitative research is perhaps not the first thing thought of when conducting a trade analysis, but its importance to a proper understanding of the trade relationship cannot be overstated. Such research and analysis requires that the situation be examined in its human terms in addition to the numeric values and inferences drawn from quantitative research and analysis. In determining the perceived motivations and barriers to direct investment, this research will essentially be attempting to analyze and predict responses to changing business situations, and such research almost necessarily takes on a qualitative form (Bavdaz 2009). The predictive value of the proposed qualitative research is, in this instance,…… [Read More]
185). Components for these products may be manufactured and put together in branches in various countries throughout the world. Thailand, Malaysia, Singapore, and Hong Kong were involved in the earliest types of production sharing, which included assembling electronic components manufactured in other countries. Production sharing, one World Bank study determined, currently contributes to approximately 30% of manufacturers' total global trade. Foreign affiliates' international exports approach over 7% of global GDP, approximately $2 trillion.
The World Trade Organization (WTO), which came into being in 1995, the only worldwide international organization that deals with rules of trade between countries, maintains their goal to be to assist producers and manufacturers of services; goods; exporters; importers in carry out business. ("What..., 2006, para. 1) "One of the youngest of the international organizations, the WTO is the successor to the General Agreement on Tariffs and Trade (GATT) established in the wake of the Second…… [Read More]
The nation also has an estimated budget surplus of over one-hundred billion dollars, making a continued expansion of infrastructure spending as well as stimulus money -- if needed -- and the provision of incentives to future domestic and foreign business development in the country highly likely (Siddiqi 2008). Oil money, though not the sole source of Saudi Arabia's significant wealth and stability, has played a major part in the country's ability to ride out this economic storm largely unscathed, with hardly a misstep in their march of progress (Siddiqi 2008).
A repetition of a similar analysis at the end of 2009 shows that the country has in fact taken a hit form the global economic downturn, which could hardly be avoided, but the picture is far from dire for Saudi Arabia (Siddiqi 2009). Infrastructure investment is still taking place, and a more in-depth analysis of Saudi Arabia's long-term spending and…… [Read More]
MNE Foreign Pricing, Profits
One of the most challenging areas of a multinational firm's business is setting target pricing and revenue for foreign markets, given the complications arising from currency denominations and exchange rates.
That is because exchange rates demonstrate the linkage between one nation and its partners in the global marketplace. They affect the relative price of goods being traded (exports and imports), the valuation of assets, and of course the final economic yield on those very assets.
In the period of fixed or constant exchange rates these prices, values, and yields were predictable over time. However, since 1973 we have been living in a world of flexible rates where foreign exchange markets determine these rates based on trade flows, interest rate differentials, differing rates of inflation, and speculation about future events.
Exchange rates can be expressed as the foreign price of a domestic currency (i.e., the Euro price…… [Read More]
Optimal Foreign Entry Strategy for Jaypee Brothers
Established in 1969, Jaypee Brothers is the largest health sciences publisher in India with offices in the United Kingdom, the United States and Panama. Jaypee Brothers currently publishes more than 350 health science books and journals each year (About Us 2015). The company is currently seeking to develop its presence in other markets including the Middle East and Africa. This paper reviews the relevant literature to provide a brief overview of Jaypee Brothers and to identify a professional entry strategy for the company to enter these new markets. Finally, a summary of the research and important findings concerning an optimal professional entry strategy for Jaypee Brothers are provided in the conclusion.
eview and Discussion
With its headquarters in New Delhi, India, Jaypee Brothers (hereinafter alternatively "Jaypee" or "the company") is a global publishing company with collection centers in the United Kingdom,…… [Read More]
China's Economy And Foreign Policy
There have been radical changes in the internal political and economic scenario of China during the last two decades. (Lampton, 2001) The growing economic stability and control has increased the status of china to a great extent among its trading counterparts. Further, it has become obligatory on the part of the Chinese Government to make it certain that the economic development to restructure the political discipline whose ideology had a severe jolt with the fall of Soviet Union. (Part Two - Chinese Foreign Policy) Ever since the inception of economic reforms in China during 1978 there is a considerable enhancement in the Gross Domestic Product to the tune of 9.5% per annum on average. It is pertinent to probe on the factors responsible for such a great success. The success is attributed to the adoption of institutions and policies by the Chinese Government that could…… [Read More]
Myth of Asian Miracle
Critical Analysis of a Paper by Paul Krugman
The phenomenal growth in the East Asian countries and China during the 1980s-1990s startled the western world. Were they going to overtake the developed economies of the western countries was the question asked in the economic circles. Stanford economist Paul Krugman  wrote a controversial article, 'The Myth of Asian Miracle' in November / December 1994 issue of 'Foreign Affairs'.
In this article he compared the rapid growth of the 'Asian Tigers' to the economic development of the former USS during the 1950s and 60s. He argued that consistent economic development requires increased input of resources as well as increase in output per unit of input, which comes from increase in efficiency and technological advancement.
Krugman argued that rapid development of the U.S.S.. was due to increased input of resources, controlled economy and a rise in education level…… [Read More]
"Pension reform in several emerging market countries has been associated with rapid growth in assets under management and a positive impact on the development of local securities markets." (Roldos, 2004) Finally, the stability of many international securities, located in Britain, Switzerland, or Germany, to take only a few examples, means that using the diverse potential of international investment opportunities does not necessarily entail a high risk.
However, many international sources of revenue tend to be more unpredictable in their returns. A pension fund's security, especially for an older man or woman with retirement on the horizon must be of primary importance. Secondly, international developments can be difficult to predict in the long-term. And finally, international securities may be less tightly regulated in terms of their ethical scrutiny by the local governments, leading to "price distortions, bubbles," and hence greater investment risks. (Roldos, 2004)
China's Pension Fund to Invest…… [Read More]
For this reason, ANC needs to develop a plan of communication. This communication campaign would be both internal and external. When internal, it will work on gaining support of employees by explaining why Kava is an important place for investment and how what happens in Kava affects their lives. This would help in getting the much-needed commitment of ANC employees to the cause.
The external plan would focus on the people of Kava. It will communicate the need to have quality healthcare services available in Kava by showing how diseases and disasters have left people without good healthcare and a proper healthcare infrastructure. The people can then begin to see why foreign presence is needed and they can respond with greater enthusiasm. This will translate into more support and will make implementation process easier.
The primary stakeholders in this case are the people and government of Kava. The reason we…… [Read More]
investment management in the financial sector. The paper highlights the world's present macroeconomic situation. It further details the macro economic situation and the way it affects investment decisions in several investors. In addition, the paper describes a sample investment programme and provides critical decisions to investors as well as investment vehicles used by the investment moguls. The paper summarises practical exercises in compound investment management growth and the use of capital investment.
Investment management is an important part of the global financial sector, which is key in financing vast business empires. Investment management is incorporated under state laws employing several individuals and creating revenue to key players in the financial market. It is the management of several securities and assets to meet specific objectives for the benefit of the investors. The products used known as investment vehicles can be of minimal risks such as government bonds; carry high risks such…… [Read More]
Determine which institutional and risk factors must be considered and whether they support entry or not.
The company needs to evaluate critically the risks and institutional factors before deciding on entering the foreign market. The institutional and risk factors must be relevant to the ambitions and expectations of the company. Institutional factors constitute three principal aspects. The first aspect of institutional factors is the political institutions for instance the nature of policymaking, regulations, and adjudications in the foreign market. The company intending to enter the foreign market must ensure that the political institutions support its mission and vision in the process of exploiting the scarce resources within the economy (Baek, 2011). The second institutional factor is the economic situation of the foreign country. Economic nature of the nation would be in the form of structure of the national factor markets and accessibility of the international factors of production.…… [Read More]
foreign market. Use Powerpoint presentations I attached.
Strategies of entering a foreign market
Corporations are said to have become one of the most important forces in the world economy, not only by the volume of business they conduct at a transnational level but also through the influence they can exercise at the level of the national governments and regional economies. The examples are numerous and include some of the most important multinational companies in the software, car making, oil producing industries, or retailers. However, corporations developed from small businesses, with impressive initiatives, and great potential that they developed and then "exported" abroad. In this sense, some of the most complex marketing and business plans were initiated and strategies to enter foreign markets emerged.
There are several aspects to be taken into account when dealing with a successful strategy for entering a foreign market: the way in which a company decides…… [Read More]
Private Sector Investment and Economic Development
Investment and economic development
The ole of Private Sector investment in Economic Development
In the past few decades there has been overwhelming support for growth and development rooted in private investments and market-oriented strategies. A move from public sector driven growth has come as result of the need to reduce the widening gap in the balance of payment account, increasing public debt, rising inflation rate, growing foreign debt fundamentally falling living standards. There has been a shift from the need for large public corporations undertaking productive activities in an economy owing to the realized inefficiency in resource allocation. Corruption and misappropriation of public funds is observable owing to the lacking need to optimally reap benefit from the investment. Unlike in the public sector, private sector investment guarantees optimal productive activities, efficient allocation of productive resource, technological advancements to reduce cost and increase productivity (Dao,…… [Read More]
In general, Product Development at Ford involves three major stages, all leading up to the manufacture of the vehicle: Plan, Design, and Verify -- then manufacture. To do this, though, functional areas need to manage costs, plan marketing programs, ensure that needed parts are available, plan manufacturing schedules, hiring (if needed), shift changes, and numerous other data (a/p, a/r, payroll, etc.). The model for Ford is:
(ource: Murthy and Desai)
Thus, on a daily, or ongoing basis, employees in numerous functional areas are able to pull up historical data on models, features, issues; find out stages of development for new models or new programs; chart advertising effectiveness using detailed database parameters, preplan tooling, resource, and supplier needs; access accounting and invoice functions, and, system wide, use the available information for appropriate levels of knowledge management (Maynard 2004).
By department, a needs analysis shows that each individual department has both similar…… [Read More]
Corona Beer (Modelo)
Identify and discuss the trends in the global beer markets.
Driven by the rapid consolidation of breweries and channel-based selling organizations the global beer markets continue to experience flat or slow growth. With the cost of entry into this industry high from a capital investment standpoint, accentuated by high interest rates, the overall industry growth rates continue to be flat with differentiation at the product level contributing little to overall market growth. The key to gaining market share in the global beer industry today are distribution and selling alliances. Alliances and partnerships on the sell-side of breweries are very high priority, as are continued investment in information systems and technologies to streamline the supply chain operations (Sahin, obinson, 2002). Gaining greater supply chain efficiencies can significantly increase overall profitability by reducing stock-outs by minimizing pricing and delivery inaccuracies and increasing product quality. The brewery industry has as…… [Read More]
Globalization and Education
Globalization involves a number of different elements, including economic integration, freedom of capital movements, and the increasing "transfer of knowledge, cultural stability" and an increase in cultural interactions (Al-odhan, 2006). The process of globalization has been fostered by industrial-age improvements in transportation, communication and through political and economic liberalization. One of the antecedents of the era of globalization was the creation of the European Common Market. When this was extended to not only allow for goods and capital to move more easily across borders but labor as well, this ushered in a new era of mass migration. Today, many of the world's leading cities have incredibly diverse populations, as people from all over the world are drawn by the economic promise of major urban hubs. One of the areas where this trend can be seen is with education. For decades, education has been trumpeted as a pathway…… [Read More]
Foreign markets Strategic Entry Options
Most large companies with their distributorship or licensing agreements in other countries often consider having their own subsidiaries or having licensing agreements that are long term in nature in foreign nations to enable them carry out their businesses. These business arrangements have their costs as well as their benefits and these may vary from one country to the other depending on the economic standards, the political situation and the human recourses available in the given country.
In the case study given herein, the acquisition of the Tokyo Tee subsidiary by the USA based clothing manufacturer will have related costs such as the lengthy and expensive process of doing the legal paper work involved in the acquisition of the subsidiary. The US firm will also have to meet hefty costs of the professional fees, the accountants, the solicitors and the surveyors. The US firm will also…… [Read More]
8 billion. The Occupation authorities also helped the Japanese government overcome postwar economic chaos, especially rampant inflation, by balancing the government budget, raising taxes and imposing price and wage freezes, and resuming limited foreign trade" (Kesselman et al., 203). The U.S. aid not only helped to rebuild the country, but also ensured that Japan was stable enough so that renegade seedlings of Communism or comparable institutions didn't suddenly flourish. The United States should sue this wise historical strategy that it deftly employed to help the economies of poorer nations in the Middle East. hen people are living in poverty, this makes them ripe breeding grounds for terrorism to build and people to be brainwashed by doctrines which vilify the est. Furthermore the United States should invest money in developing educational programs in the Middle East, so that the citizens there can actually envision a real future for themselves, without having…… [Read More]
American foreign policy change from 1940 to the present?
Before the 20th century, the U.S. had a strong tradition of isolationism and non-interventionism. Beginning with American participation in World War I and continuing with its involvement in World War II after the invasion of Pearl Harbor, the U.S. increasingly began to conceive of itself as not only a player on the international stage, but also the ideological promoter and protector of democracy. When World War II ended with the U.S. bombings of Hiroshima and Nagasaki, it was clear that America had taken a position of power in the world, both militarily and politically.
In the decade that followed World War II, American foreign policy pitted itself against Soviet Communism through the pursuit of "containment:" limiting the expansion of Soviet power and Communist ideology to other nations. This policy of containment was the primary driving force behind the "Cold War" and…… [Read More]
VON Calls on Foreign Markets
von believed that having regionalized new product development centers, supply chain operations, marketing and sales divisions would make them more competitive in foreign markets. Ironically the exact opposite happened, as the case illustrates. von's performance was drastically reduced and the duplication of effort crippled the organization. Unfortunately the highly decentralized, market-driven organizational structure that von had such high expectations for failure to deliver the results needed to keep the company growing. The net outcome of the highly decentralized organizational structure was a massive duplication of effort and cost overruns; the organizational structure turned into more of a liability than strategic asset. The goal of this case analysis is to explain and recommend how von can regain profitability while also attaining a higher level of internal new product development, production and selling efficiency. nother objective of this analysis is to evaluate how von can attain a…… [Read More]
Foreign Direct Investment
Why has foreign direct investment (FDI) increased in recent decades?
According to the OECD, (Organization for Economic Co-operation and Development), one of the major trends in the global economy during the recent decades is the increase in the foreign direct Investment (2001, p.101). Foreign direct Investment is the process of establishing, owing and controlling the production of goods and services in the foreign country or in simple words, it can be defined as the real assets which are abroad. It is associated with the transitional corporations which expand their global activities.
If we go back 50 decades, we find out that foreign direct Investment was considered as an unhelpful, unconstructive, negative and a method of introducing improper technology for the developing countries. However, a completely different view of FDI has emerged in the last two-three decades and today it is considered as very beneficial for the economic…… [Read More]
" (Grabel, 2004) Good institutions serve as the basis for economic growth due to right market-based and market-guided incentives being created which include those stated in this study and specifically: (1) rule of law; (2) competitive markets; (3) low taxation (4) noninflationary monetary policies; and (5) free trade. (2002) Good institutions serve to "Foster other cultural patterns of conduct, hard work, savings and industriousness, honesty and trustworthiness, creativity, and self-responsibility. These are the bases of the wealth of nations." (Easterly, 2002; as cited in: Ebeling, 2002) These tools are helpful in avoiding and mitigating economic risks in development.
Easterly, W (2002) the Elusive Quest for Growth: An Economists Adventures and Misadventures in the Tropics (Cambridge, MIT Press) Chapter 2
Krueger, a.O (1998) Why Trade Liberalization Is good for Growth, Economic Journal 108
Demetriades, P. And Hussein, K.A (1996) Does Financial Development Cause Economic Growth? Time-Series Evidence From 16 Countries,…… [Read More]
popularity of foreign restaurant: consumer attitude and behavior toward foreign cuisines in Bangkok
Thailand as a tourist destination
Thailand has become a tourist destination hotspot for its scenic beauty, the humble nature of their people, and the relative value of foreign currencies relative to the baht. According to EIU ViewsWire (2003), "Growth in the tourism industry in recent years was the result of the depreciation of the baht against non-Asian currencies (which improved competitiveness relative to destinations outside the region), aggressive marketing campaigns and an increase in the number of airlines offering flights to Thailand." (EIU ViewsWire, 2003)
Additionally, according to EIU ViewsWire (2003), "Tourist arrivals rose by 5.8% to just over 10m in 2001, despote the global economic downturn and the September 11 terrorist attacks in the U.S., bringing in Bt 295bn (U.S. $6.6 bn) in revenue. Thailand benefited from its reputation as a safe and stable society and…… [Read More]
Dell, HP, Microsoft, Exxon Mobil and Wal-Mart has emerged as the strong candidates in the international market, which has been possible only because the companies have avoided and curtailed the possible security risk either through strategy in which the focus has been to aver the security concerns either through provisions for the social welfare of the people in the region, or through relocation (Erik, 2004). The United States has therefore maintained its lead in the war of trade in the field of globalization with the weapons of research, technological advancement and services fully active and supportive.
It is proposed that the country should devise a strong security monitoring system which should be compatible to the economic and trade system and linkages of other countries, the government of the United States should not design its economic policies as per the security concerns prevalent in the certain regions, rather areas of…… [Read More]
The Risk of Trade ith India
Over the course of the last decade, the once stagnant Indian economy had become among the fastest growing in the global community. The opening doors of free trade have made India a top destination for high-tech companies, a major service industry provider and host to countless foreign trade and production endeavors. However, just as its fortunes have improved with the proliferation of globalization, so too have its recent fortunes felt the decline of the global recession. As reported in an article from Businessline, Chennai, "due to the difficult financing conditions prevailing in the international credit markets and increased risk aversion by the lending counterparties, gross inflows of short-term trade credit to India declined in 2008-09 and this trend continued in 2009-10." (Anonymous, p. 1)
Still, India remains an economy rife with growth potential for foreign investors. An important factor in…… [Read More]
This strategy of investing face-time has continued to scale extremely well in the U.S., yet has faced many challenges in other nations that value data, hard numbers and strong methodologies to validate the claims of products. One nations' buyers of cosmetics in particular, the Japanese, are more focused on the specifics of the how a product is produced and want to know in great detail what the ingredients are in specific measures. The level of data analysis presented by cosmetics providers in Japan is often taken as a measure of the elegancy and exclusivity of a given cosmetic product over another (Grammenou, 2009). Due to these wide variations in how cosmetics are sold, Avon continues to excel in westernized cultures with the U.S. being their flagship market. In Asian cultures were the depth and sophistication of data is an indicator of exclusory and elegance, Avon continues to struggle in other…… [Read More]
However, the Thai government's guidance on growth has been conservative; if we take the orld Bank's pre-crisis estimate of 6.2% (Thailand Business News) and factor in Chatikavanij's warning, Thailand's near-term growth potential comes in at a healthy 4.2%.
From a pure value perspective, Thai stocks are already trading at relatively cheap levels (Reuters). The SET is valued at roughly 12 times estimated 2010 earnings, which makes it the second-cheapest market in Asia (behind Pakistan) and significantly undervalued compared to Indonesia (14 times 2010 earnings) or Malaysia (15.7 times 2010 earnings). hile it may be time to reconsider our sector weightings in order to take advantage of bargains in Bangkok (and dump stocks that are looking rich or in danger of deteriorating further as the political crisis continues), it would probably not be prudent to move money away from the market entirely.
The idea of reallocating some or all of the…… [Read More]
These climatic changes in turn impact negatively on the economy and the people within the region. There is need hence for the environmental protection for sustainable development. Though there have been significant measures like the formulation of the Arctic Waters Pollution Prevention Act (AWPPA) which was geared towards protection of the marine environment especially tackling pollution and shipping safety laws to be in place (Justice Laws Website, 2013), there is still more that Canada can do to ensure a sustainable economic growth of this region.
Canada must therefore resort to ecosystem-based management system within the Artic region. There is need to ensure an approach that will take into account the co-management of the species in the Artic region that may cross the international borders like the polar bear and the Arctic birds. The collaborative approach to the ecosystem should also include the Arctic research and science ventures conducted in collaborative…… [Read More]
S. has unilaterally imposed sanctions to punish ran for its support of these activities. To address the shortages from this embargo, the ranian government has been working on developing nuclear power. They claim that this will help to tackle the nation's current and future energy needs. (Khan, 2010, pp. 77 -- 110)
This has led to the UN imposing another embargo against the slamic Republic for their continuing incompliance with international law. At the heart of the issue, are concerns that ran is using their nuclear energy program as a cover for developing an atomic bomb. The fear is that the ranians will pass on nuclear related materials to terrorist groups or they will use these weapons to attack the U.S. To prevent this from happening, America is leading an international effort to further isolate ran. n response, ran has been defiantly working on their program. This has caused the…… [Read More]
The company's foundes and senio manages howeve feaed this would make the company less agile and able to espond to maket equiements (Gammenou, 2009).
Thee have been many socioeconomic and demogaphic changes that have affected Avon's business model in the last two decades. The geatest socioeconomic foce affecting them today is the need fo many women to wok full-time jobs to contibute to thei household's income. This has dastically changed the company's distibution model as thee ae fewe women to wok as pat of thei sales foce. The shift in socioeconomic status is also one that has made competition with stoes even moe focused and aggessive, as etailes have the advantage of being moe of a poduct aggegato than poduct develope. Thei distibution model is shifting significantly as a esult.
Inceasing the ugency of the decision was the fact that demogaphic makets wee changing apidly, as wee the…… [Read More]
28). The directions that this new "great and powerful" friend takes in the next 20 years will have a pronounced effects on what type of foreign policy is needed to maintain the middle road aspired to by Australian foreign policymakers. In the Australia's Defence Department's White Paper, "Defending Australia in the Asia Pacific century: Force 2030," published in 2009, a number of eventualities are examined in terms of the appropriateness of an independent, dependent, interdependent or coindependent foreign policy in the future, depending on how the world changes. In the chapter, "Australia's Defence Policy," the White Paper makes the following points:
1. A nation's 'strategic posture' is the expression of how it seeks to secure its strategic interests, including by reducing the risk of conflict in the first place, and how it would potentially use force in relation to its strategic interests. In terms of strategic posture, an Australian government…… [Read More]
India / Theoretical / Foreign Policy Shyness (Pant, 2009, p. 251). Pant's latest scholarship on India's foreign policies (2009, p. 253) is far more forceful and impactful than the narrative in his 2008 book. He chides India for not letting go of its Cold ar foreign policy strategy. "The Cold ar officially ended almost two decades ago,"
Pant writes (p. 253), and yet India continues to debate "the relevance of the Non-Aligned Movement (NAM)." That attitude among India's elite foreign policy experts "…is merely the clearest sign of the intellectual sloth that has infected the foreign policy discourse," Pant states. "Intellectual sloth?" Nowhere in Pant's 2008 book are there phrases so vigorous and persuasive. He stresses that it is "irresponsible and dangerous" for India to "cling to ideas that served a different strategic context" (p. 253).
Theoretical Approach / India Foreign Policy (Robert Gilpin / John J. Mearsheimer):
Professors…… [Read More]