COMMERCE 4SA3 Chapter Notes - Chapter 1,5,6,7: New Trade Theory, Multinational Corporation, Foreign Direct Investment
13 Jan 2017
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Document Summary
Apples decision to move production overseas was not completely about lower labour costs. In china: factories could increase/decrease production quickly. Factories are clustered so easy to get needed materials. Volumes of goods, services, investment crossing national borders expanded faster than world output every year in the last two decades of 20th century. Wto and other organizations work to remove trade barriers between nations. Nations have transformed economies by: privatizing state-owned enterprises, deregulating markets, welcoming foreign investments. Globalization: shift toward a more integrated and interdependent world economy. Merging of distinct separate national markets into one huge global marketplace. Tastes and preferences of consumers in different nations are beginning to converge. Companies still must use different marketing strategies, product features, and operating practices to best match conditions of country. Firms follow each other around the world. Sourcing goods/services from locations around globe to take advantage of differences in cost of factors of production. Manufacturing products are global products because of international outsourcing.
