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“The study of international business is fine if you are going to work in a large multinational
enterprise, but it has no relevance for individuals who are going to work in small firms.”
Evaluate this statement.

This topic can be one of two arguments. Technology has had a huge impact on the way companies
operate for business. An organization with a website can connect with people around the world.
Understanding this, the company should take the opportunity to learn and advise on technology.
This is not only the advantage of competition; they will be left behind. Paperback phone book days
are over. Without information technology, most companies would not even exist.

Information technologies penetrate all aspects of business, both large and small. Without this, the
company will not be able to keep up with the competition. On the other side of this theory,
everyone has access to it. This in turn allows all competitors to have the same advantage. This may
work for a smaller company that has a good marketing campaign. Larger companies have not been
able to succeed on the market. The possibility of advertising allows these smaller organizations to
become more lucrative simply by recognizing them. A retail company that wants to ship its
products worldwide is able to rapidly increase sales.

These smaller companies can also grow when they are recognized as a company that is able to
maintain a good service or product nationwide or globally. Instead of sending their products, they
can decide to employ people from the country that buys goods or services to their heirs, thereby
increasing their availability and enabling participants from the host country. Some countries, such
as India, can provide services at a much lower cost than in the United States, which gives the
company more profit. Starbucks is a great example of this type of business. Twenty-five years ago
Starbucks was unknown. They had a small number of stores in the United States. They are now
one of the most popular brands in the world, with almost 17,000 stores in 50 countries (Hill, 2012).

Vizio is also a small business success story. They are a company that produces flat-screen TVs,
known all over the world and employing less than 100 employees. They outsource most of their
engineering, all production and large logistics. Because it is able to outsource so much at reduced
rates, the company can sell at discount stores. They are also able to sell quantitatively. This gives
the company a competitive advantage over other retailers who have higher overheads (Hill, 2012).
Considering all these issues, it seems that small businesses could benefit from globalization if they
were properly managed.

2. If current trends continue, China may be the world's largest economy by 2030. Discuss.

China will be the world's largest economy in 2030, overtaking the United States, while India -
currently the seventh largest - will be third, pushing Germany and Japan down. We looked at 75
economies in emerging, emerging and border markets to make long-term forecasts of their growth
potential and changes in global rankings. Emerging economies turn out to account for around 50
percent of global GDP by 2030, which means a seismic shift from half that in 2000. China will
continue to be the largest contributor to global growth, but another five Asian economies will be
among the world's six fastest-growing economies - Bangladesh, India, Philippines, Pakistan and
Vietnam. The working-age population will increase by more than 2.5 percent per year over the
next decade, while in Europe it will decrease by 0.5 percent per year.

Growth in both emerging and developing markets by 2030. Will be slowed down. Emerging
economies are projected to grow by 4.4 percent annually, compared to 4.7 percent in 2010, while
developed countries will grow by 1.5 percent, compared with 1.7 percent from 2010. But because
emerging countries make up an increasing percentage of the world's average global growth rate
from 2013 - just below 3 percent - could hold on to 2030. This would increase global GDP by
around 40 percent compared to today's level. Emerging countries have accounted for about half of
global growth over the past decade, but according to our estimates, about 70 percent of future
global growth will come from economies currently considered emerging. But even if GDP per
capita in emerging countries doubles between 2007 and 2030, it will still be less than 15% of the
average for developed countries, and even China will be less than 30%. While poorer countries
with younger populations will generally occupy the highest positions in the ranking, better
education, health care, rule of law and technology may still maintain the position of countries with
declining employment, which should be noted in Thailand and some Central and Eastern European
Countries. That is why the United States, with a large economy and relatively strong
demographics, remains close to the top of the rankings, while the sheer size of the German and
Japanese economies keeps them in the top five, despite the rapidly aging population. However, the
small population, rich European economies in a difficult demographic situation are falling in the
ranking: Austria and Norway will be outside the top 30 to 2030, and Denmark below 40. In India
and China by 2030 will account for 35 percent of the world's population and almost 25 the
percentage of the working age population will be elsewhere in Asia. However, the largest regional
applicant will be Africa, where young, rapidly growing populations will mean that there will be
more people between 16 and 64 years old on the continent than in China.
1. Outline why the culture of a country might influence the costs of doing business in that
country. Illustrate your answer with examples.

Sometimes cultural differences between countries can have a negative impact on conducting free
market activity. Take, for example, Walmart, who wants to expand his business in India. He tried
to do it but by buying local farms and small shops. As a result, he was able to reduce the price of
simple vegetables such as tomatoes and potatoes. Thinking that Indians would buy this strategy,
Walmart opened a store. Indians may be as price conscious as Americans, but for them loyalty and
honesty meant more. As soon as the Indians discovered that local jobs for the average citizen were
reduced, they immediately stopped buying from Walmart. Sometimes morality and ethics and
caring for neighbors is more important than buying things at the lowest price. American culture is
rooted in how best to save costs when shopping. People always try to find the best deal. But they
don't care about the ethics and morality of this process. Many cultures; Germany and India care
more about what happens at later stages.

Japanese culture is another example. They take their own corporations to run their own country
very seriously. It is very difficult for external people to enter the market there. Japan has a very
large IT distribution sector, and the largest IT distribution corporation, which generates revenues
of $ 40 billion based in America, is not able to set up a store in this country. Japanese culture
simply thinks it's best for their corporation, their employees and shareholders to benefit from doing
business internally. This is very interesting because Japan does an amazing job selling its products
and technologies outside. In fact, they have already successfully started robotics for the elderly.
Something that the rest of the world will slowly catch up.

2. What are the implications for international business of differences in the dominant religion
or ethical system of a country?

Currently, many companies produce and sell worldwide and employ employees from various
countries. How do differences in a country's religion or ethical system affect their global business?
How does culture affect them? Is outsourcing of production to developing countries ethically
justified? The purpose of this article is to answer these questions.

Religion involves shared beliefs, values and rituals (Aswathappa, 2008; Deresky, 2014; Hill,
2007). Values are assumptions about what is good, right or important. Ethical systems include
codes of conduct and values that externally form a group of people's behaviors (Hill, 2007). Ethical
systems are often based on religion, and religion expresses ethical principles (Mead and Andrews,
2009).In terms of percentage of the world's population in 2010 (Pew Research Center, 2015),
Christianity (31.4%) is the largest religion followed by Islam (23.2%). By 2050, however, the
Islamic population will be approximately equal to the number of Christians. The following section
describes the impact of these two religions and their ethics on international business.

Christian religion dates back over 2,000 years ago. It is a monotheistic religion focused on the life
and death of God's son, Jesus Christ (Deresky, 2014). Christianity consists of four main
denominations, of which Protestantism has the greatest impact on business (Hill, 2007).
Protestantism encourages hard work and wealth (Aswathappa, 2008). It is believed that God
pleases reinvesting wealth more than "worldly" consumption. In 1904, Sociologist Max Weber
discovered that this Protestant work ethic facilitated the development of capitalism in Western
Europe because it led to capital investment in enterprises (Hill, 2007). Although historically
Weber's theory has some credibility for the development of capitalism in Western Europe,
capitalism has also developed elsewhere for reasons other than the Protestant ethical system
(Dahrendorf, 1983).

Islam is also a monotheistic religion. Muslims believe in Allah and live in accordance with the
Koran and Sharia, i.e. Islamic law (Deresky, 2014). Prophet Muhammad was a merchant (Hill,
2007), and the Koran supports free enterprise and trade (Aswathappa, 2008). Islamic ethics teaches
that profits should benefit collectives to which individuals are required as members of society
(Hill, 2007). Muslims believe that Allah controls time. This may result in a loose schedule.
Business meetings take place around five daily prayers for which space should be provided.
Companies can expect a decrease in efficiency and the number of contracts concluded during the
holy month of Ramadan. In strictly Islamic countries, women are not allowed to participate fully
in business (Deresky, 2014). It is worth noting that the relationship between a country's religion
and the ethical system does not always apply. Until 1949, China's official ethical system was
Confucianism, which, unlike Christian and Islamic ethics, does not stem from religion. Confucian
teachings are still influencing the Code of Conduct in East Asia (Hill, 2007). They focus mainly
on three ethical principles: honesty, loyalty and mutual obligations (Aswathappa, 2008). They are
key to the "guanxi" network from which help and information can be obtained, but must be paid
back. Guanxi may be stronger than law. Honesty favors establishing reliable relationships between
business partners, and loyalty to superiors results in obedience to orders (Hill, 2007). In turn, life-
long employment is expected (Aswathappa, 2008).

In summary, these findings suggest that the country's dominant religion and ethical system affect
international business because they shape society's behavior. However, this should be interpreted
cautiously, because shared religion or ethics do not necessarily result in the same behavior in the
workplace. For example, two countries with the same religion may have a different approach to
business because of other influences, such as culture. Cultural impact will be discussed in the next

3. What are the Economic and Political arguments for regional economic integration?

Economic integration refers to the various agreements between different countries and or regions,
marked by the regulation of monetary and fiscal policies and the reduction of trade barriers.

Arguments for regional economic integration can be state as follows:

 Free trade and no barriers

 More goods and products from different countries (customers have more options)
 Resources are used more efficiently.
 Countries are able to specialize in the production of a certain goods
 Promote free movement of capital and labor among its members
 Common external trade policies, market and economic union
 Access to new technology
 No visa needed or work permits
 It facilitates political cooperation between countries

There are not many regional economic integrations in the world because there is loss of national
sovereignty, employment reductions, trade division, new trade barriers for countries outside the
trading block, industries that are not competitive enough lose their businesses, there are migration
issues and greater economic inequality. Also, it was thought that countries tend to seek their own
political and economic power and most political leaders don/t want to share that power or
economic growth, they have different interests.