Politics

Question 1

What is a country’s political system?

Answer 1

It refers to the structural dimensions and pwr dynamics of its gvt - specify institutions, organisations, interest groups + define norms that govern pol activities

Question 2

What is the individualism-collectivism continuum?

Answer 2

individualism - primacy of rights/role of ind
collectivism - primacy of rights/role of community

Question 3

What does political freedom measure?

Answer 3

degree to which fair/compet elections occurs
extent to which ind/group freedoms are guaranteed
legitimacy ascribed to gen rule of law
freedom of expression

Question 4

Can you define political risk?

Answer 4

risk that political dec/events in a country negativelt affect the profitability/sustainability of an investment

Question 5

What are the 4 types of political risks?

Answer 5

1. Systemic risks
   impact all firms that operate in particular pol system
2. procedural risk
   refers to risk evolving daily movement of ppl/prod/funds from one point to another in global market
3. distributive risk
   Result of profits generated by foreign companies in local economy
   If the host country questions the distributive justice of the rewards of operating in its market, it may wonder whether, as the business grows more successful, it is receiving its “fair” share of the growing profit
4. Catastrophic risk,
   disrupts business env in a way that affects every firm in the country
   arises typically from flash points → ethnic discord, illegal regime change, civil disorder, insurrection.

Question 6

What are the five types of legal systems?

Answer 6

Common law = based on traditions, precedent, custom, usage, interpretation by courts

Civil law = relies on systematic collection of codes + statues judges must follow

Theocratic system = based on religious precepts

Customary legal = follows wisdom of daily experience

mixed legal system =combines elements of all other systems

Question 7

what is the main difference between rule of man and rule of law?

Answer 7

rule of man = legal rights derive from ind who commands the power to impose them (anarchy)

rule of law = systematic and objective laws applied by public officials who are held accountable for their administration

Question 8

What are some strategic concerns one must keep in mind regarding the political and legal environment?

Answer 8

mgr must also consider longer term strategic issues how pol/leg env might influence them

vulnerable to abrupt changes that could require them to adjust their
- manufacturing configuration
- supply chain coordination
- marketing strategy

marketplace behaviour can make strategic dec challenging esp when rule of man prevails

Question 9

What are some strategic issues to keep in mind regarding political and legal env?

Answer 9

1. A product’s country of origin - where the product was grown, produced, or manufactured is important for determining import charges
2. Product safety and liability, varying standards
3. Countries also have legal jurisdiction to stipulate laws that set the criteria for litigation when agents — whether legal residents of the same or of different countries — are unable to resolve a dispute
4. consider intellectual property rights and protection in a given country

Question 10

What is intellectual property?

Answer 10

IP refers to creative ideas, expertise, intangible insights that grant its owner a competitive advantage. It also refers to the right to control + derive benefits from writing, inventions, processes, identifiers

Question 11

Which technological trends are currently reshaping IB?

Answer 11

telecommunication, SoMe & eCommerce, Production & Operations, Transportation, standards integration

Question 12

What are the 4 predominant types of democracies?

Answer 12

representative, multiparty, parliamentary, social

Question 13

How does managers adapt their conducting business in totalitarian systems?

Answer 13

Managers adjust their decision-making to the fact that government’s imperatives is sustaining state power, and the market is perceived to be a powerful tool to do so.

Question 14

What is the Third Wave of democratisation?

Answer 14

wave of democratisation between 1950 and 2000s

Question 15

What is a fundamental holds that productive business activites acquire?

Answer 15

fair just and transparent rules that
1. set and sustain property rights
2. minimise the costs and complications of resolving disputes
3. specify rules that reduce the riskiness of business transactions
4. organisation rules to protect contractual partners against abuse