business in canada (chapter 9)

is a process involving the integration of world markets
• e.g., global brands and global products
Globalization can be considered a process that is expanding the degree and forms of
cross-border transactions among people, assets, products, and services
Globalization reflects the shift toward increasing economic interdependence—the
process of generating one world economic system or a global economy.

association:
(dynamic interconnectedness associated with the shifts taking place, across a range of environments including technological, political, economic and cultural spheres, that allows for multiple forms of collaborating without regard to distance, time and in many cases even language.)

pull:
- potential for sales growth
- obtaining needed resources

going global

push:
- force of competition
- shift towards democracy
- reduction in trade barriers
- improvement in technology

- Mergers and acquisitions
- joint ventures and strategic alliances
- direct investment in foreign operations
- establishing of subsidiaries
- licensing and franchising
- outsourcing
- exporting and importing

a company that has its facilities, plants and other assets in a country other than its home country or the country that it is incorporated in

benefits:
Encourage economic development
Offer management expertise
Introduce new technologies
Provide financial support to underdeveloped regions of the world
Create employment

threats:
MCs do not have any particular allegiance or commitment to their host country.
Profits made by an MNC do not necessarily remain within the host country but may be transferred out to other locations, depending on where the MNC feels the funds are most needed

trade protectionism: is about protecting a country's domestic economy and business through restrictions on imports.
1. Low-priced foreign goods that enter the country could compete with goods already produced here and, in effect, take business away from domestic producers. The ultimate consequence may be loss of sales and loss of jobs for domestic industries that are unable to compete with these lower-priced imports.
2. A country that imports more than it exports will have a negative balance of trade, or a trade deficit, which often results in more money flowing out of the country (to buy the imported goods) than flowing in (for our exports).

Among the best-known government responses to address these potential risks are the imposition of tariffs and import quotas.

means bringing different countries closer together by reducing or eliminating obstacles to the international movement of capital, labour, and products or services. A collection of countries within such an integrated region is typically referred to as a regional trading bloc.
1. free trade area
2. customs union
3. common market
4. economic unions

Free trade and protectionism represent two opposing approaches to international trade. Free trade emphasizes the removal of trade barriers, promoting economic efficiency and market access.
vs
Protectionism aims to protect domestic industries but can lead to higher prices and reduced consumer choice.

- international trade
- global supply chains
- outsourcing