Part 3

Question 1

What are the 4 aspects of the Transition in Economic governance?

Answer 1

1. Viability of discrete borders; increase in transactions, challenging to control borders
2. Indeterminacy of location; where a transaction takes place or which jurisdiction is more and more complex
3. Increase irrelevance of geographic proximity; remover necessity for phisical proximity
4. Reorganization of international production; supply chains+production processes are no longer bound by geographical constraints

Question 2

Finish; Pacts are sets of…

Answer 2

Pacts are sets of common parameters that allow firms to operate with each other despite being diffrent

Question 3

What is a private authority?

Answer 3

A private authority involves an organisation not associated with government institutions exerting (uitoefenen) decision making power which is regarded as legitimate in a particular issue area

Question 4

What is Market governance?

Answer 4

Those institutions, governments and non-governmental, that both enable to constrain the behaviour of markets and market actors

Question 5

Globally integrated;

Answer 5

Firms which can gain meaningful efficiency benefits through integration and who face minimal pressures through response to market differences

Question 6

Nationally responsive;

Answer 6

Firms to whom returns to efficiency are limited and the pressures to respond to the market differences are strong

Question 7

Transnational;

Answer 7

Firms who simultaneously face strong pressure both to integrate across borders and to respond to national differences

Question 8

The liability of foreignness

Answer 8

The inherent disadvantage that foreign companies experience in host countries because of their non-native status

Question 9

Ngo

Answer 9

Non government organisation

Question 10

Explain FDI

Answer 10

FDI = foreign direct invests. This takes place when a company, multinational corporation or individual from one country invests in another countries assets or takes ownership stake in its companies

Question 11

What is meant by the fragmentation of authority?

Answer 11

Governance is no longer government, private firms take on public functions

Question 12

In the global world, the firm serves…

Answer 12

Aa an agent of global power

Question 13

What are the different types of firms,

Answer 13

1. Regional Exporter/Importer
2. Global Exporter/Importer
3. Multinational Challenger
4. Original Equipment/Design Manufacturing

Question 14

What is meant by liability of foreigness?

Answer 14

Inherent disadvantage of foreign companies in host countries because of their non-native status

Question 15

What are the pitfalls of going international?

Answer 15

1. Possibility that a high investment will yield low returns
2. Possibility of entering partnerships that will turn out to hinder rather than facilitate the expansion
3. Possibility of not adjusting to local regulations and incurring potential penalties

Question 16

Many successful MNE’s share three characteristics;

Answer 16

1. A large % of intangible assets
2. An organization culture which lowers the organizational impact
3. Being good at disaggregating value chains