1.
International Business
Part One
Background For International
Business
Chapter One
Globalization and International
Business

2.
Chapter Objectives
• To define globalization and international business
and show how they affect each other
• To understand why companies engage in
international business and why international
business growth has accelerated
• To discuss the major criticisms of globalization
• To become familiar with different ways in which a
company can accomplish its global objectives
• To apply social science disciplines to understanding
the differences between international and domestic
business
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Inc. publishing as Prentice Hall
1-2

3.
Definition of Globalization
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The broadening set of
interdependent relationships
among people from different
parts of a world that happens to
be divided into nations

4.
Definition of International Business
All commercial transactions—
including sales, investments, and
transportation—that take place
between two or more countries
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Inc. publishing as Prentice Hall
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5.
Factors in Increased Globalization
• Increase in and expansion of technology
• Liberalization of cross-border trade and resource
movements
• Development of services that support international
business
• Growing consumer pressures
• Increased global competition
• Changing political situations
• Expanded cross-national cooperation
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Inc. publishing as Prentice Hall
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6.
The Criticisms of Globalization
• Threats to national sovereignty
• Growth and environmental stress
• Growing income inequality
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Inc. publishing as Prentice Hall
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7.
Reasons That Firms Engage in
International Business
• Expanding sales
• Acquiring resources
• Minimizing risk
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Inc. publishing as Prentice Hall
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8.
Modes of Operation in International
Business
• Merchandise exports and imports
• Service exports and imports
• Tourism and Transportation
• Service Performance
• Asset Use
• Investments
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Inc. publishing as Prentice Hall
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9.
Types of International Organizations
• Collaborative arrangements
• Strategic Alliance
• Multinational Enterprise (MNE)
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10.
Views on future of international business and
globalization
• Further globalization is inevitable.
• International business will grow primarily
along regional rather than global lines.
• Forces working against further globalization
and international business will slow down
both trends.
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Inc. publishing as Prentice Hall
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