GMS 520 Lecture Notes - Lecture 4: Extortion, Corruption Perceptions Index, Apple Lossless

• School: Ryerson University
• Department: Global Management Studies
• Course: GMS 520
• Professor: Glenn Asano

Document Summary

Role of govt is important in international business, e. g. tariffs, trade. Imf says gap in advanced economies is highest it"s been in decades. Indicates lack of income mobility = higher social costs for a country favored treatment and protection from drivers of inequality. How wealth, income, consumption is distributed in a group. Affected people are incentivized to divert efforts toward securing. Governments at risk of making bad policy resource misallocation. E. g. could lead to backlash against liberalization. Genie coefficient is a quick and relatively standardized comparison. International trade = engine for growth = higher competitiveness, higher efficiency. But countries enabled by tech also drives income inequality. Adoption of offshoring and labor saving tech = decline in manufacturing = downward pressure in wages for unskilled labor, higher demand for higher skilled people = increased wage premium, reduce costs of imports. Income inequality weakens demand, increases financial instability, slows growth.