GLOBAL ORGANIZATION MANAGEMENT
Free of charge trade: authorities not try to influence through quotas or duties what can be bought from/sold to other country Benefits: -Smith, Ricardo and heckscher Ohlin forecast that the effects of fee trade incorporate both static economics gain (because free trade supports a higher level of domestic usage and more useful utilization of resources) and powerful economic gains (because totally free trade stimulates economic development and the creation of wealth) * Totally free trade gain even when it might produce on its own (promote unhindered free trade) Theories:
1 . Mercantilism: country's ideal is to preserve a operate surplus and trade is usually zero-sum => gov should intervene installment payments on your Adam Smith's absolute benefits: a country features when it's more effective producing a single product than any other region => focus on advantage items 3. David Ricardo's comparison adv: (ass. Resources push freely in a country, frequent returns to scale, share of methods or effectiveness unchanged) One country features absolute adv. in all items => will need to specialize in goods they produce most proficiently and buy less efficiently possibly they could produce more proficiently But not constantly benefit carry out in fact fige resources, decreasing returns, active effects and growth * Paul Samuelson: free trade result in reduce wages in rich region + just offshore service job cause immigration 4. Heckscher-Ohlin theory: (ass. tech is the same)comparative adv. arise from dif. in factor endowment (not only labor efficiency like Ricardo) => export goods that use what is considerable, import products use what is scarce Yet Leontief paradox: U. S i9000 exports less capital intense than imports du they are relatively capital abundant five. Vernon's Support life cycle theory(good before yet less today do the theory is ethnocentric, production is usually dispersed internationally, and merchandise can go to multiple markets cug luc): because product adult, location of sales and optimal development location will alter: make & sell in US-> sell in overseas -> sx in international & ALL OF US in overseas price conflict -> go to lower cost location => firm should spread out its actions to exactly where most efficient 6. New transact theory: capability of firms to gain economies of level (unit cost reduce perform mass production) is important to aid for control, 2 details: -trade can increase variety of goods take advantage to consumers and giam cost do trade can lam industry large enough, can where economies of range are important, - some companies that achieve economies of scale already a large proportaion of total world require thi market can only support small number of organizations -> initially mover benefit -> trade is benefitial even when countries do not vary in source endowment or tech (chi do 1st mover) => gove needs to have strategic trade policy nurture and safeguard first ocasionar adv and econ weighing machines adv. 7. Porter's competitive adv: so why a nation succeed in several industries by 4 attributes: (+gov coverage +chance) - factor endowments: a place's position in factors of production to compete (natural resources, site, skill, infras) -demand conditions: nature of home require
-relating and promoting industries: presence or lack of suppliers and related that are competitive -firm strategy, framework, rivalry: conditions governing just how companies are made, organized, managed and beaten -> gov can affect demand by product standard, competition by regulation, highly well-informed workers and advanced infras Balance of payment accounts: keep track of payment and receipt from other countries (double entry bookkeeping) -> saving account (records deals pertain to goods, providers, income, receive& pay) & capital account(records changes in inventory of assets) + economic account(record transaction of trade asset)=0 Section 6
Free trade: gov do not restrict what resident can buy promote to another country Just how gov get involved:
* Charges: + particular tariff:...