IBE Lecture 1

7/23/2019 IBE Lecture 1

http://slidepdf.com/reader/full/ibe-lecture-1 1/17

International Business

Environmentassociate professor Radu

Mușetescu, PhD

[email protected]

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o! !ill "ou get "our mar# atthis discipline$

E%am & oral & ' open ans!er(uestions & )*+

eminar & -*+

In addition, up to 1 point due to "ourpresence at the lectures - % *./0

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2h" do !e stud" 3internationalbusiness environment 4$ 5ns!er6 7ohn

loman /**8• 3the core economics that you will need as a business

student + business related topics not typically covered inan introductory economics textbook 4

• 3thinking like an economist 4

•

3a toolkit of concepts that can be used in a whole host ofdierent contexts4

• 3In this book we will be looking at the economicenvironment in which rms operate and at how economicscan help in the process of business decision taking4

& a 9od" of #no!ledge from economics that decision ma#ersin 9usiness ma" use

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:uestions6

Does a 9usinessman need to learneconomic theor"$

Does he need a PhD Philosophiae Doctorin economics$

;an someone 9e a successfull9usinessman !ithout pa"ing attention toeconomic theor"$

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<=> <=> ?E>

• Bill ates from Microsoft

• teve 7o9s from 5pple

•

Aarr" Ellison from =racle

• undreds$ Ma"9e>

• housands$ <ot sure>

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• theoretical statement & esta9lishes an universall"

valid relationship of causalit" 9et!een concepts e%.3 price increase for a product will lead, ceteris paribus, to a decrease in demand4 & a9stract,universal, etc.C

• historical proposition & presents an event from

the past !hich occured in a particular setting of timeand space e%. 3in 202, !pple Inc" #aunched Iphone$ on the international market 4 & does not pretend toe%plain !h", it ust transmits a piece of informationC

•

entrepreneurial judgment & an opinion regardinga possi9le future development e%. 3next year,compact car sales will grow4 & a9out future,speculative, implies ris#

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uccesful entrepreneurship

& the a9ilit" of entrepreneurs to 9est serve certainconsumption desires

& entrepreneurs al!a"s allocate resources in the present inorder to get a future prot & the" ta#e over the 3economics

ris#4F there is no sure receipt for getting a prot & there is no3theor"4 of successful entrepreneurship a theor" of 3ho!to ma#e mone"4

F there are ho!ever some 3la!s4 of the economic s"stem

that the 9usiness decision ma#ers have to pa" attention &if the" choose to ignore them, the conse(uences can 9emassive leading to 9usiness failure & e%. inGation,9usiness c"cle, nationaliHation e%propriation, so on.

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Denitions of3international 9usiness

environment4

& 3all the forces that in%uence any aspect ofthe activity of an organi&ation4 KIan Broo#s,/**-L

F including too man" dimensions !ill 9eimpossi9le & ho!ever, it is an iimage of the

comple%it" of an" 9usiness environment

F the need for more focus

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Aimited num9er of dimensionsof the stud" of 39usiness

environment4• PE & political, economic, social and

technologic

• PEAE EEPAE & political,

economic, sociocultural, technologic,legal and ethical also the naturalenvironment

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Initiall", the concept of environment !asused in the legal dimensions 3legalenvironment4 & the core 9od" of la!s!ith an impact on doing 9usiness.

Aater, the a!arenes that the formal nominal la!s are not enough forencompassing aspects !ith a 9ig impact

on 9usiness6 national culture, 9usinesspractices, customs, organiHationalculture, etc.

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ome clarications639usiness environment4

an objective reality, independent, thatcan 9e measured F a signicant num9er of

(uantitative anal"sis and hierarchies compariHons at the international level 3'orld(conomic )orum4, *eritage )oundation , soon

a subiective opinion, diOerent frompersons organiHations

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ase o o ng us nessran#ing 9" 2orld Ban#,

/*1'1. ingaporeC

/. ong QongC

'. <e! eelandC

-. Snited tatesC0. Denmar#C

). Mala"siaC

J. QoreaC

8. eorgiaC

N. <or!a"C

1*.Snited Qingdom

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e ! ave e%p oret!o fundamental

approaches6• 9usiness perspective F theor" of the rm and the

theor" of the international rm & ho! rms perceivethe 9usiness environment

• government perspective F the theor" of pu9licregulation F there is a competition not onl" 9et!eenrms 9ut also 9et!een governments in attracting

economic activit" such as Toreign Direct InvestmentsF governments attempt to 3create4 a 9usinessenvironment !hich is friendl" to!ards rms andcompanies in order to reach some pu9lic o9ectives

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h i ll l i



here is a common parallel comparison9et!een

the 39usiness environment4 and the 3natural

environmentecos"stem4• comple% relationships 9et!een an entit" and its3environment 46 suppl" chain in 9usiness versus foodchain in nature

• the paradigm of 3competition4 & the 9est t to its

environment !ill survive• the theor" of 3evolution4 & the challenge of 3change4and 3adaptation4 & onl" those !ho adapt !ill 9e a9leto survive

• no single entit" can 3un9alance4 the s"stem undernormal circumstances 3the la! of large num9ers4

•the 3alien4 & either dissappears or 9ecomes hugel"successful 3invasive species4

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ra99its & an invasive specie in5ustralia

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5n" metaphor has its limits6

• social actors rms, nongovernmentalorganiHations, so on have the a9ilit" tota#e the initiative to change the

environment F social actors are not onl"3reactive4 9ut also 3constructive4 &activities such as 3-ublic .elations4,3lobby 4 and 3advocacy 4

• human 9eings al!a"s surprise themselvesand the others 9" the a9ilit" to 3ar9itrate4the rules

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Du9ai & 1NN* versus /**' versus/**J http6!e9ur9anist.com

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IBE Lecture 1

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