MKTG 467 Study Guide - Midterm Guide: Oligopoly, Foreign Exchange Controls, Comparative Advantage
17 Oct 2016
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Ethnocentric: home country is superior to others - assumes products and practices that succeed at home will succeed everywhere; leads to standardized or extension approach. Polycentric: each country is unique - each subsidiary develops its own unique business and marketing strategies; aka multinational; leads to localized or adaptation approach. Regiocentric: companies serve markets throughout the world but on a regional basis. To benefit from trade, country should specialize and trade the goods which it is the best at producing (lower marginal cost and opportunity cost) Examines the stages that involve location of production and market penetration. Postulates a four-phase international trade cycle for most international products. 3rd + 4th stages = standardization (as the 3rd stage) Weakness time-dependant and deterministic evolutionary path does not include cooperative entry modes. Rooted in ra theory and ownership-advantage of the eclectic paradigm. Implies that the existence of imperfect markets and a firm"s unique advantages are catalysts for fdi.
