INTERNATIONAL

BUSINESS:
Spread & Global
Impact

Objectives of Presentation
To understand the history and impact of
international business.
To learn the definition of international
business.
To recognize the growth of global linkages
today.
To understand the U.S. position in world
trade and the impact international business
has on the United States.
To appreciate the opportunities and
challenges offered by international
business.
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What is International Business?

International business consists
of transactions that are devised
and carried out across national
borders to satisfy the objectives
of individuals, companies, and
organizations.

Need for International Business

More and more firms around the
world are going global,
including:
Manufacturing firms
Service companies (i.e. banks,
insurance, consulting firms)
Art, film, and music companies

International business:
Causes the flow of ideas, services,
and capital across the world
Offers consumers new choices
Permits the acquisition of a wider
variety of products
Facilitates the mobility of labor,
capital, and technology
Provides challenging employment
opportunities

Types of International Business

Export-import trade
Foreign direct
investment

Licensing

Franchising
Management contracts
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International Business and the

Roman Empire
Pax Romana, or Roman Peace ensured that
merchants were able to travel safely and
rapidly.
Common
coinage
simplified
business
transactions.
Rome developed a systematic law, central
market
locations,
and
an
effective
communication system; all of which enabled
international business to flourish in the Roman
Empire.
The growth of the Roman Empire occurred
mainly through the linkages of business.
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International Business and the

Roman Empire (cont.)
The decline of the Roman Empire
can be attributed in part to:
infighting and increasing decadence
the Pax Romana being no longer enforced
the decline of use and acceptance of the
common coinage
declining levels of communication

As a result, former Roman allies

cooperated with invaders.
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United States: A Global Leader

The United States has developed a world
leadership position due to:
its use of market-based transactions in the
Western world
a broad flow of ideas, goods, and services
across national borders
an encouragement of international
communication and transportation
Pax Americana, an American sponsored
and enforced peace

The Smoot-Hawley Act

The 1930s, the U.S. passed the SmootHawley Act, which raised import duties to
reduce the volume of goods coming into the
U.S.
The act was passed in the hope that it would
restore domestic employment.
The result was a worldwide depression and the
collapse of the world financial system.
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Expansion of International Trade

In the past 30 years, the volume of
international trade has expanded from $200
billion to over $7.5 trillion.
The sales of foreign affiliates of multinational
corporations are now twice as high as global
exports.

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Global Links Today

International business has created a network
of global
links
that bind countries,
institutions, and individuals with trade,
financial markets, technology, and living
standards.
For example, a reduction in coffee
production in Brazil would affect individuals
and economies worldwide.

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Globalization
Because of globalization, for the first time in
history, the availability of international
products and services can be accessed by
individuals in many countries, from diverse
economic backgrounds.

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THANK YOU

Rakhi Saha
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