IBUS1101 Lecture Notes - Lecture 2: Liberal Democracy, Offshoring, World Trade Organization
5 Jun 2018
School
Department
Course
Professor
Learning Objectives:
2.1 understand market globalization as an organizing framework
2.2 know the drivers of globalization
2.3 understand technological advances and globalization
2.4 comprehend the dimensions of globalization
2.5 appreciate firm level consequences of market globalization
2.6 Understand the societal consequences of globalization
Globalization of markets = the gradual integration and growing interdependence of national economies.
•
Declining trade barriers and rapid changes in communications, manufacturing, and transportation
technologies are enabling firms to internationalize much more rapidly and easily than ever before.
•
Globalization allows companies to outsource value-chain activities to the most favourable locations
worldwide.
•
Firms source raw materials, parts, components, and service inputs from suppliers around the globe.
•
Globalization has also made it easier for companies to sell their offerings worldwide.
•
Meaning of globalisation of markets:
Phases of globalization:
e.g. BREXIT
•
New phase of de-globalisation:
Assumption 1
•
Globalisation assumptions under threat from anti - globalisation movement:
Chapter 2 Globalization of Markets and the
Internationalization of the Firm
Saturday, 10 March 2018
8:11 PM
Textbook Page 1
Global consensus that globalisation is good
○
Inequality issues are becoming more important
○
Assumption 1
•
As countries become richer they become more like liberal democracies
○
Assumption 2:
•
Regional integration will continue and strengthen
○
But Brexit, DE regionalisation and de nationalism?
○
Assumption 3:
•
Technocratic elites are capable of managing the global economy
○
But GFC?
○
Assumption 4:
•
LO 2.1: Understand market globalization as an organizing framework
drivers or causes of globalization
•
dimensions or manifestations of globalization
•
firm-level consequences of globalization.
•
societal consequences of globalization.
•
Organization framework to examine market globalization:
LO 2.2: Know the drivers of globalisation
Over time, national governments have greatly reduced trade and investment barriers
○
The trend is partly facilitated by WTO, an organisation of some 150 members nations
○
Worldwide reduction of barriers to trade and investment
•
The launch of market reforms in China and former Soviet Union since 19802 (berlin wall and break
of soviet union) to freer trade
○
Market liberalisation and adoption of free markets:
•
Industrialisation, economic development and modernisation
•
Drivers of Globalization:
Textbook Page 2
Document Summary
2. 1 understand market globalization as an organizing framework. 2. 5 appreciate firm level consequences of market globalization. Globalization of markets = the gradual integration and growing interdependence of national economies. Declining trade barriers and rapid changes in communications, manufacturing, and transportation technologies are enabling firms to internationalize much more rapidly and easily than ever before. Globalization allows companies to outsource value-chain activities to the most favourable locations worldwide. Firms source raw materials, parts, components, and service inputs from suppliers around the globe. Globalization has also made it easier for companies to sell their offerings worldwide. Globalisation assumptions under threat from anti - globalisation movement: As countries become richer they become more like liberal democracies. Technocratic elites are capable of managing the global economy. Lo 2. 1: understand market globalization as an organizing framework. Organization framework to examine market globalization: drivers or causes of globalization dimensions or manifestations of globalization firm-level consequences of globalization. societal consequences of globalization.
