The Global Economy Flashcards
is a complex system of interrelated production, consumption, and exchange activities that ultimately determines how resources are allocated among all the participants. The production, consumption, and distribution of goods and services combine to fulfill the needs of those living and operating within the economy.
Economy
is the study of how people allocate scarce resources for production, distribution, and consumption, both individually and collectively.
Economics
is the intensification and stretching of economic interrelations around the globe.
Economic Globalization
Economies around the world are already showing various spots of ____________ and it is all attributed to the integration of economies around the world as a result of globalization.
homogeneity
Itis a process that refers to corporate expansion by consolidating additional marketing functions and activities within asingle management framework. It shows the company’s market relationship, and its extent affects the company’s behavior.
Market Integration
It is the process by which company combines different activities around theworld so that they operate using the same methods. Itinvolves the process of product standardization and technology development centralization.
Market Integration
History of Market Integration
____ Century:
Locomotive and marine steam engine revolutionized world transportation;
The opening of Suez Canal;
Victory for free trade-abandon tariffs on imported goods;
Integration of the world wheat market and world rice market;
19th
History of Market Integration
Great Depression of _____
It hampered free trade andforced countries to raise their tariffs to keep foreign product out and help their localfarmers.
1930s
History of Market Integration
Post _______ World War
The integration of the global market restarted when American corporations. Thereare changes in the patterns of trade and technology that took place because of the advancement in shipping and navigation.
Second
Types of Market Integration
Horizontal Market Integration
Vertical Market Integration
Forward Vertical Integration
Backward Vertical Integration
Conglomerate Market Integration
Type of Market Integration
It is a competitive strategy in which two companies of the same nature merge or one larger company acquires asmaller company.
Horizontal Market Integration
Type of Market Integration
It is a competitive strategy of a firm own to own the upstream suppliers and downstream buyers; this is an arrangement in which supply chain of a company is also owned by that company.
Vertical Market Integration
Type of Market Integration
This process occurs when a companydecides take control of the post-production process or is acquiringa business further up into the supply chain.
Forward Vertical Integration
Type of Market Integration
This process occurs when a company decides to buy another company that makes an input product acquiring company’s product.
Backward Vertical Integration
Types of Market Integration
This involves a combination or fusion of companies that are involved in unrelated business activities.
Conglomerate Market Integration
Type of Market Integration
Conglomerate Market Integration
Types ofConglomerate Market Integration:
Pure Mergers conglomerates
Mixed Mergers Conglomerates
Type of Market Integration- Conglomerate Market Integration
Types ofConglomerate Market Integration:
involves companies that have nothing in common.
Pure Mergers conglomerates
Type of Market Integration - Conglomerate Market Integration
- combination of companies thatare looking for product extensions or market extensions.
Mixed Mergers Conglomerates
Effects of Market Integration
Wider selection of goods and services;
Political Cooperation.
Erosion of national sovereignty.
Employment opportunities.
Bretton Woods System
It monitor exchangerates and lend reserve currencies to nations with balance-deficits. Thisinstitution came into formal existence in December 1945.
The International Monetary Fund (IMF)
Bretton Woods System
It is also known as World Bank Group which is responsible for providing financial assistance for the reconstruction after World War II and theeconomic development of less developed countries.
The International Bank for Reconstruction and Development
These are institutions that provide financial support andprofessional advice for economic and social development activities indeveloping countries and promote international economic cooperation and stability.
International Financial Institutions
International Financial Institutions
The Traditional goals of these institutions are:
To reduce global poverty and improve people’s living conditionand standards.
To support sustainable economic, social and institutionaldevelopment.
To promote regional cooperation and integration.
To enhance measures that promote economic growth and protection of the environment.
It is a concept of thetwentieth centurywhich is an image of a very highly urbanized area but are full energized and governed by modern state of the art technology and advanced communication capacity. It is a city know to be an economic super power. It is also known to be the “brain hubs” and the centers of a “knowledge economy.”
Global City
