...DEPARTMENT OF ECONOMICS Course: International Business Module, 2004/2005 Course Lecturers: Sougand Golesorkhi (B10) Kwok Tong Soo (B47a) Tutors: Alina Petrescu Jasleen Sindhu Tatiana Boroditskaya Zoe Whang Tel: + 44 (0) 1524594418 (Soo) Email: s.golesorkhi@lancaster.ac.uk k.soo@lancaster.ac.uk Please note that the Departmental Office is open every weekday, 9-11am & 2-4pm. You should consult the Part 1 notice board at regular intervals throughout the term. This is located outside B34 in the Management School. Students should note that the principal method of communicating administrative matters will be via Lancaster e-mail accounts. Also note that there is a Part 1 Economics discussion space (for 101 and 102 students taking the International Business option) that students and staff can access via the following URL: http://domino.lancs.ac.uk/econ/intbus.nsf. If you have queries regarding your Economics studies you can attend one of the drop in sessions in which a member of staff is available to help you with any aspect of the course with which you are struggling. Details of the times and locations of the drop in sessions will be posted on the Part 1 notice board. Course Aims: The aims of the course are to: • introduce students to a variety of international business issues, including international trade, international investment, international labour flows, and the market for foreign exchange. • provide students with an...
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... ANDREAS JOHNSON Host Country Effects of Foreign Direct Investment The Case of Developing and Transition Economies This thesis consists of four individual essays and an introductory chapter. While independent from each other, these essays share some common properties. They are all empirical and focus on the interaction between inflows of foreign direct investment (FDI) and host country characteristics. The primary focus of the thesis lies in how inflows of FDI affect developing and transition economies. Macro-level data are used in all essays. The first essay analyses the FDI inflows that the transition economies of Eastern Europe have attracted and tries to find determinants of these inflows. The following two essays compare the effect of FDI between developing and developed economies. The second essay studies the relationship between corruption in the host country and the volume of FDI inflows. The third essay explores the effect of FDI inflows on host country economic growth. The fourth and final essay analyses the relationship between FDI and trade, focusing on the link between FDI flows and host country exports in eight East Asian economies. ISSN 1403-0470 ISBN 91-89164-64-4 ANDREAS JOHNSON Host Country Effects of Foreign Direct Investment The Case of Developing and Transition Economies Jönköping International Business School P.O. Box 1026 SE-551 11 Jönköping Tel.: +46 36 10 10 00 E-mail: info@jibs.hj.se www.jibs.se Host country effects of foreign direct investment:...
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...Alimatou TRAORE Concept Application essay #1 International Trade- IBS390 Summer 2015 International Trade and Foreign Direct Investment Introduction 1. International Trade, what is it? 2. FDI : Definition and different types 3. Impacts of FDI( Foreign Direct Investment) on International Trade 4. Costs and Benefits of FDI( Foreign Direct Investment) Conclusion Introduction The world economy has developed over the past few decades in a great manner, regarding investment in particular and the way multinationals enterprises are now investing in the developing world to increase their production, assets, and interconnected market networks. Individuals everywhere in the world turn out to be closer than ever before. Goods and services available in one nation A will be instantly promoted in another country B or C. Universal exchange and communication became more basic. This current situation is called Globalization. Globalization is at the same time the primary cause and effect of the incredible growth of International Trade over the past decades. Thanks to International Trade, consumers around the world enjoy a wider range of products than they would if they only had access to domestically made products. 1. International Trade, what is it? International trade simply refers to the movement of goods and services across borders. This activity gives rise to a greater competition and more competitive pricing in the market. However let’s not...
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...village. Not only the frequency of international travelling increased manifold but the possibilities of cross-border trading of goods and services have also increased exponentially. These impacts are collectively known as globalization. (Hill, 2009) defines globalisation as a process which enables individuals, organisations and governments from different natins to come across each other and interact in an intergative manner. The end result of such intergation would be an intergated globalised market system which can act as a melting pot of indivual economies of different nations. There are two ways in which globalisation can be envisaged, i.e. with the production perspective and thebmarket perspective. (Hill, 2009) defines the markets' globalisation as melting down and convergence of individually independent market places into an amalgamated market place. Sharing of the sources of production from different geographical locations for levaraging the quality and cost of the goods and services produces is the idea behind the products' globalisation. (Hill, 2009) Many institutions have been formulated to help manage, regulate and police the phenomena of globalization and to promote the establishment of transnational treaties for global trade. A few are as following:: * The World Trade Organization (WTO) * The International Monetary Fund (IMF) * The World Bank * The United Nations (UN) These institutions act on an international level to regulate and tackle any problems...
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...Clinton in 2000 was the culmination of American efforts to normalize relations with the former enemy. In 1986 the Doi Moi resulted in Vietnams sucessful transition to a socialist orientated market economy. Elements of market forces and private enterprises were introduced soon after and a stock exchange opened in 2000. In 2007 Its successful economic reforms resulted in it joining the World Trade Organization which has promoted more competitive, export-driven industries, It also became an official negotiating partner in the Trans-Pacific Partnership trade agreement in 2010. These lifts in protectionism has meant that poverty has declined significantly however, Vietnam is still working to create jobs to meet the challenge of a labor force that is growing by more than one million people every year. It also still suffers from relatively high levels of income inequality, disparities in healthcare provision, and poor gender equality. This essay aims to firstly set out the role of the WTO and why Vietnam sought accession, it will then discuss both the positive and negative impacts that freer trade has had on the country. Vietnam joined ASEAN/AFTA in 1995, ASEM in 1996, and APEC in 1998. In January 1995, Vietnam applied for WTO...
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...Introduction This essay will explore the nature of NAFTA and its effect on regional integration as well as state economies from several perspectives. In 1993, the United States, Canada and Mexico signed the North American Free Trade Agreement to achieve the higher level of regional integration. This NAFTA not only concerns the removal of trade barriers, but also aims to promote the movement of capital. Firstly, this essay will explain the evolution of NAFTA and its successful influence on economic integration. Furthermore, this chapter will provide the criticism on the influence of NAFTA. Secondly, this study will discuss the impact of NAFTA on regional integration, particularly economic integration. Then, this essay will propose the understandings on the effect of NAFTA on members’ economies and businesses from four perspectives, including trade, economic growth, employment and FDI. Main body The Evolution of NAFTA The North American Free Trade Agreement (NAFTA) issued in 1993 aims to removal trade barriers and liberalise economics and business among the United States, Canada and Mexico. Compared with similar FTA economic relationship, such as EU, NAFTA is described as the most implemented FTA (Orme, 1996). Like most FTAs, NAFTA not only effectively coordinates resource and improves competitiveness of countries and corporates, but also promotes the movement of products, services and investment, even financial integration. For instance, Krugman & Hanson (1993) stress that...
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...Course Study Guide 2011–12 International Business Management BUSI 1493 [pic] Contents 1. Welcome 3 2. Introduction to the Course 4 2.1 Aims 4 2.2 Learning Outcomes 4 2.2.1 Knowledge and understanding of: 4 2.2.2 Intellectual Skills: 4 2.2.3 Subject practical skills: 5 2.2.4 Transferable skills: 5 2.3 Learning and teaching activities 5 3. Contact Details 5 4. Course Content 6 4.1 Session Reading 20 5. Assessment Details 21 5.1 Summary of assessment 21 5.2 Detailed description of assessment 21 6. Other Details 23 1. Welcome Welcome to the exciting world of International Business Management! In this era of globalization, there are very few companies that can say that they are not part of a global network. Every firm has to think of itself as a global company, if for no other reason than because it has to meet competition from global companies. This changes the entire strategy of the firm. In the future, we expect that all of you will be involved in managerial decision making that will take you beyond the realms of your geographical territory. This course on International Business Management will have the focus on helping you make better international decisions. Aside from the opportunities offered by globalisation, there are also many risks in entering into the global market. This course will attempt to address, in a structured format, the ways and possibilities of addressing...
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...the globalization of international trade, however it is also expansion of foreign direct investment (FDI), multinational corporations, integration of the world capital markets and much more. Thus, globalization can be defined as the interdependence of national economies through trade, finance, production and a growing web of treaties and institutions. The evidence of globalization is clear. Nowadays, over $4 trillion in foreign exchange transactions are made every day, where more than $15 trillion of goods and $3.7 trillion of services are sold across national borders. A more intuitive example can be a British person driving the German car with a Dutch engine that was assembled in Mexico from made in US components, which in turn, were fabricated from Korean steel. But what influenced the trend for globalization? This essay will outline two main macro factors that helped globalization to evolve. It will then pass on to describing four major features of globalization. To begin with, the globalization was driven by the decline in barriers of the free flow of goods, services and capital that has occurred since the end of the Second World War due to the GATT arrangements. This resulted in significant fall in average tariff rates since 1950 that are now at a 4% level leading to steady growth of international trade over the last half of the century, when by 1998 it was three times more than it was in 1950. In addition, many countries removed restrictions to FDI. Therefore, these trends...
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...Xiamen University Title The Impact of Capital Account on Economic Grow Author : Yagoub Ali Elryah School of Southeast Asian Studies Faculty of International Relations Student number: 25520120254069 January, 2013 Correspondence Yagoub Ali Elryah, Xiamen University, Xiamen, Tel: 15860796370, E-mail: yagoubelryah@hotmail.com 1- Background: In the era of economic integration, most of the developing and developed countries not only open their borders for trade of goods and services, ideas, technology, information, etc. but also open capital accounts that have virtually made the world a global village1. During the 1980s and 1990s, a large amount of capital moved internationally from private investors in the whole world. It took place primarily through sale of bonds and equities and international investment by multinational corporations. Thus, globalization of finance and efficient allocation of capital stimulated growth in developing countries significantly. It is the nature of capital to move from places where it is plentiful to where it is scarce, provided there is no barrier to cross the border. Return on new investment is higher where capital is scarce. This is an incentive for people to save more (leading to enhanced capital formation) in developing countries as these countries are in general capital poor. For the same reason, foreign individuals and companies seek to invest their surplus capital in developing countries. Thus, this channel in turn, can help...
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...Kaydeon Burnett Professor Jim McCarty December 14, 2015 Final Paper “International Business is any commercial transaction that crosses the border of two or more nations.” This class of international business has truly been a great deal of help to me in pursuing my degree in Business Management. When I first enrolled in this class I was a bit skeptical about how I would learn such a potentially difficult subject without being in a classroom, however I truly learned a lot. With an international business it has various key learning concepts including entry to new markets, trade and foreign direct investments, politics, economics and environmental variables of culture. Each of these concepts carries a different definition as well as the same intent. Globalization by definition means a “trend toward greater economic, cultural, political, and technological independence among national institutions and economies.” (p 7) Within globalization it is very important that the particular company that plans to expand beyond the borders of their home office must understand that going global is not just looking at the global aspext and not taking the time to properly invest money, time, and strategy. For example when Apple began to go global they took the time that was necessary to properly strategize on how to get their product from beyond the four walls of the Apple brand. Globalization has good parts as well as bad parts. The good part about globalization is that the particular...
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...states that “economic globalization constitutes integration of national economies into the international economy through trade, direct foreign investment (by corporations and multinationals), short-term capital flows, international flows of workers and humanity generally, and flows of technology.” (Bhagwati, 2004) In the past few years this increasing integration within the world economies has promoted economic growth and been aligned with the substantial growth in world trade. On the one hand, globalization has been associated with the improvement of living standards within a society. As well as, simplifying the production process. However, this phenomenon could potentially act as a constrain to the societies well being, in addition to aiding the in the restrain of economic emergence. (Daniels, 2001) In this essay, the factors contributing to globalization will be illustrated in regards to the trade barriers and the emergence of MNCs. The benefits and costs of globalization will be demonstrated by evaluating the affects on employment and the impact on the business operations. The emergence of globalization has been due to several factors; one of the main drivers of a more integrated world economy is the liberalization of trade. The reduction in trade barriers: due to agreements arrived at first through the GATT (General Agreements on Tariffs and Trade) and then through the WTO trade barriers have been reduced. This has opened up markets in Asia, Africa and Latin America to...
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...Effect of FDI on Bilateral Trade Abstract Contemporary literature refers to trade and Foreign Direct Investment (FDI) as alternative strategies. The debate is mainly between two notions: (1) that FDI displaces trade, and (2) that FDI and trade complement each other. Literature on FDI talks about the effect of foreign investments on trade. Lipsey (2002) mentions that outward FDI may decrease or increase (or have no effect on) exports of home country. These effects depend largely on the competitiveness of the host country and the motives behind investment by the home country in the host country. This paper is aimed at studying the effect of FDI on bilateral trade as well as effect at the aggregate level especially in the developed-developing nation paradigm. Introduction Literature suggests that there are a number of motives on which FDI takes place across nations. Most of the firms in the developed countries will go for foreign investment once they fulfill their domestic market and they in order to grow will go to foreign market. In this case the main motive of a firm is to tap new markets. This entry of one firm in to a foreign market will create a bandwagon effect thorough which their competitors will also enter that market. Again, when the competition sets in the foreign market, companies will be forced to take cost reduction measures to achieve higher profits will look for other destinations which have lower cost of production and thus the motive will become efficiency...
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...Foreign direct investment (FDI) is an international investment whereby a firm in one economy has control or major influence over the management of another firm in another economy (Xu, 2014). For many years, China has grown to be one of the most attractive countries for foreign direct investments of almost every present organization in the world.. Despite the rise in labour costs and shortages of skilled labour along with greater competition faced by foreign firms in the China market since 2008, China has still succeeded in continuously attracting more FDI as compared to other developing countries. This essay while relating to certain FDI theories (Eclectic theory) will further discuss the general factors that has led to the increase of FDI in China despite many challenges over the years as well as using a firm such as Gap Inc. as a case example to show the main specific factors which influenced the company to undergo FDI in China. As China's population nears 1.4 billion people (Xinhua, 2010), there are many general 'pull' factors contributing towards the increase of FDI in China. One of the factors would be country's market size as accordance to Cheng & Kwan (2000) whom agreed that market size does attract FDI in China. China's large market size potentially creates huge domestic demand that provides greater opportunity for foreign firms to undergo FDI as firms access into a larger customer base would be made easier, allowing them to increase their productivity and profit...
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...INTERNATIONAL ECONOMICS THEMES AND ISSUES MMN222154-13- AB THE IMPACT OF FOREIGN DIRECT INVESTMENT ON ECONOMIC GROWTH IN NIGERIA BY AZUMONYE M. CHUKWUEMEKE S1344407 INTRODUCTION Over the years, the debate on the role of foreign direct investment (FDI) as a factor that induces economic growth has received the attention of policy makers, researchers and international organizations (Tumala et al, 2011). There is no denying that most countries strive to attract foreign direct investment (FD1) because of its putative advantages as a tool of economic development. Therefore, this essay seeks to ascertain the extent at which growth in foreign direct investments (FDIs) influences economic growth in Nigeria in the long-run and investigated the empirical relationship between FDI and privatization. Nigeria, after independence began with an economy that was mostly driven by the public sector. According to Tumala et al (2007), Nigerian Enterprises Promotion Decree (NEPD) of 1972 imposed several restrictions on FDI entry, thereby earning the tag „the indigenization policy‟. It reserved 22 business activities exclusively for Nigerians, including advertising, gaming, electronics manufacturing, basic manufacturing, road transport, bus and taxi services, the media and retailing and personal services. Foreign investment was permitted up to 60 per cent ownership and provided that the proposed enterprise had, based on 1972 data, share capital of N200, 000 ($300,000) or turnover...
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...November Exam 2013 Compulsory Essay Question 50 Marks Question: How do you think South Africa could grow faster, create more jobs and reduce inequality? In your answer explain how your policy objectives would achieve their intended objective. CORRECTING SOUTH AFRICA’S STRUCTURAL FAULTS FOR INCREASED ECONOMIC GROWTH (Mentionsomething about GEAR and RDP) Introduction Economic growth has been handicapped by high levels of unemployment, poverty and inequality, which continue to plague society today. Since 1994 South Africa has achieved an average growth rate of 3 %, a level that is mediocre by international standards and is still below what is deemed necessary for supporting a lasting transition to democracy and correcting the historical injustices of apartheid. Numerous policies have been implemented to correct these faults and increase growth but have seen little success. A combination of poor economic reasoning and implementation may account for this. But a recurring problem with historical and current policies is that they are contradictory and at times conflicting. The 2008 OECD report highlighted this in AsgiSA, which focuses on employee training but offers little to improve basic education. Therefore, correcting these faults and achieving increased growth calls for complementary policies to create a virtuous cycle for success. The following essay looks at the labour market, industry, trade and public-private partnerships as areas of focus for constructing...
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