MKTG 320 Chapter Notes - Chapter 3: International Trade, Protectionism, Free Trade
Document Summary
Chapter 3 (2/5/18): international trade: institutional barriers and facilitators. Reduction of trade barriers is a main concern of multinational firms and governments of the multinational firms. National and local governments erect barriers to protect small and medium enterprises from multinationals. Protection of markets with excess productive capacity. Employment protection and protection of markets with excess labor. New in the industry so they can"t basically compete with the old competitors just yet so they get protected until they can. When it comes to war, a country can"t depend on other country"s supplies and must make their own. Tariffs: taxes imposed on goods entering a particular country. Percentage requirement: local production/local labor use/limitation of foreign ownership. You can"t trade/banned products that can"t be imported to that country you are trying to trade in. Countries benefit from specialization in an industry in which they have comparative advantage and from trading with one another. Multinationals encourage efficiency in local manufacturing and services.
