REPUBLIC OF BENIN

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ABOMEY CALAVI UNIVERSITY
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REGIONAL SCHOOL OF INTERNATIONAL BUSINESS
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ENGLISH ORAL / GROUP N◦6
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THEME
TECHNIQUE IN INTERNATIONAL BUSINESS

GROUP MEMBER TEACH

✓ ABDOULAYE Ayman Dr Narcisse K. KLAO
✓ HOUANSOU Lydino
✓ HOVEMEHOU Fabrice
✓ TOGBE Samanth

SCHOOL YEAR: 2021-2022

 PLAN
INTRODUCTION

BODY
I- INFORMATION TECHNOLOGY AND GLOBALIZATION
II- ECONOMIC ENVIRONMENT
III- DIFFERENCES BETWEEN THE ECONOMIC SYSTEMS

CONCLUSION
INTRODUCTION
Globalization has become the most large-scale and dynamic process in modern conditions
because of which the global economy acquires common and unified features. A variety of
factors have contributed to the process of globalization. Some of the most important
globalization drivers are the advancements in technology and in a less scale the economic
environment.
 I- INFORMATION TECHNOLOGY AND GLOBALIZATION
Technology has undergone tremendous changes over the years. Tremendous changes witnessed
in technological sector have contributed significantly towards globalization. This is because
technological improvement makes lives of all people across the world to be more convenient.
Improved technology in transportation, internet, and microprocessors facilitated rapid growth
globalization.
A- Impact on transportation

Transportation costs are falling with improved physical communication with the help of
improved technological advances in telecommunication, computing, fiber optics and satellites.
Which has resulted in the speeding up of information flow and the transportation of goods
across nations more quickly and efficiently. This is being achieved through the technologies
mentioned above, that is at the heart of the communication and transportation globalization,
which is ongoing.
Improvements made in transportation and the development of containerization allowed goods
to move from place to place and continent to continents. Shipping ports around the world have
cranes built to lift the containers more efficiently and thus saving money and speeding trade.
Compare to pre-containership era of 1960s where trade was slow and unreliable that also fall
due to bad weather or thieves.

B- Impact on communication and businesses

The Internet /World Wide Web has been the biggest thing to come out of Information
technology advancements. That has revolutionized how information is passed or its availability
thus creating an economy based on knowledge. The Internet has been described as “a
decentralized, global medium of communication comprising a global web of linked networks
and computers As people across countries can trade and communicate instantaneously
economically, for example e-mail has allowed instant communication through the World Wide
Web, World Wide Web on the other has made “World One” as countries can now trade with
each other, all made possible due to the cost effectiveness technological advance like the
internet /world wide web. Where information is been exchanged at a global level
instantaneously. As “Information is the new mantra that spells success in the modern world”
Technology like the Internet has given rise to E-commerce; E-commerce that refers to business
conducted through means of electronic communication networks like Internet. That has brought
about new dynamics to the globalization of businesses. Where virtual business can be set up
and trade worldwide without any barriers stopping them. For example, business like Amazon,
Borders and eBay that have sprung up because of Internet have transformed the way small
business operate and have given opportunity to individuals to enter these global markets. As
Internet help provides a cheaper faster way of communication between business and its
consumers worldwide.

C- Impact on financial sector

Another sector that has seen the biggest impact because of technological globalization is the
financial sector, where diffusion of information-based technology has made possible people
around the world to trade 24/7 trading has moved to electronic system from the physical system
making money move more efficiently and on a faster level, thus allowing more participation of
those people who are connected with the internet.

D- Impact in activities

Firm can increase the productivity of their employees through the use of technology. Computer
programs and management software typically allow employees to process more information
than manual methods. Business owners can also implement business technologies to reduce the
number of human workers in business functions. In this way, small businesses can avoid paying
labor costs and benefits to employees.

II- ECONOMIC ENVIRONMENT

Apart from the technology, economic environment of various countries also directly influences
the international business, thus, the globalization. Among the economic factors, economic
system is one of the most important factors of economic development that influences the
international business to the greater extent.

A- Definition

An economic system is a means by which societies or governments organize and distribute

available resources, services, and goods across a geographic region or country. Throughout
history, three kinds of economic systems have been produced:

• the rather small number, historically speaking, in which the central organizing form is
the market (capitalistic economic system)

• those centrally planned and organized according to command (communistic economic

system)

• The mixed economic system

B- Capitalistic economic system

Capitalism is an economic system where capital goods are owned privately or corporately
through private investment decisions rather than state control. It is distinguished by the
determination of prices, production, and distribution of goods through competitive markets.

In a capitalist economy, the production of all the goods and services is dependent on the demand
and supply in the market that is also known as a market economy. It is different from the central
planning system that is also known as a command economy or a planned economy.
The main characteristic of a capitalist economy is the motive of earning profit. The capitalist
economy is also characterized by the presence of free markets and lack of participation by the
government in regulating the business.

Among the capitalist counties, they are the United Kingdom, Hongkong and Germany.

About Hongkong, the implementation of prudent economic policy within a stable and
transparent legal environment has been the cornerstone of Hong Kong’s continuing
achievement in maintaining the world’s freest economy. Well-secured property rights ensure
vibrant commercial interactions and entrepreneurial growth. With a high level of market
openness and fiscal discipline, Hong Kong continues to be a leading global business and
financial hub.

1- Advantages of a capitalist economic system

▪ More efficient

▪ Less bureaucratic

▪ More innovation

▪ Discourages discrimination and forces people to trade with each other – breaking down
barriers.

2- Problems of a capitalist economic system

▪ Inequality.

▪ Monopoly.

▪ Environmental problems.

C- Communistic economic system

Communism is a type of government as well as an economic system (a way of creating and

sharing wealth). In a Communist system, individual people do not own land, factories, or
machinery. Instead, the government or the whole community owns these things. Everyone is
supposed to share the wealth that they create.

The theory of communism’ examines those aspects of communist theory that provide a better
understanding of how Communists in power perceived the world, why they acted as they did,
and how they attempted to justify their actions. It focuses on Marxism, Leninism, and Stalinism.
Communist theory is shown to be ambiguous, often incomplete, and sometimes contradictory.
This is partly because the various theorists were writing at different times about different
conditions and in different personal situations. However, the fundamental differences of
approach amongst communist theorists can also be explained in terms of the voluntarism versus
determinism debate.

Today, the existing communist states in the world are in China, Cuba, Laos and Vietnam. These
communist states often do not claim to have achieved socialism or communism in their
countries but to be building and working toward the establishment of socialism in their
countries.

1- Advantages of communism

▪ It works effectively as a centrally-planned economy.

▪ It creates equality on a level that capitalism can never offer.

▪ It can transform the shape of an economy to the vision of the leader.

▪ It provides additional educational opportunities to the general public.

▪ It allows for employment opportunities to be given out to everyone.

2- Disadvantages of communism

▪ Central planning is challenging to achieve in a communist government.

▪ Efficiency and productivity are difficult since there is little motive for workers.

▪ There is no freedom of speech in the typical communist government.

▪ The needs of the consumer are not taken into consideration in a communist government.

D- Mixed economic system

A mixed economic system is a system that combines aspects of both capitalism and socialism.
A mixed economic system protects private property and allows a level of economic freedom in
the use of capital, but also allows for governments to interfere in economic activities in order
to achieve social aims.

Three examples of mixed economies are the U.S., France and India. For example, the United
States is a mixed economy, as it leaves ownership of the means of production in mostly private
hands but incorporates elements such as subsidies for agriculture, regulation on manufacturing,
and partial or full public ownership of some industries like letter delivery and national defense.

In fact, all known historical and modern economies fall somewhere on the continuum of mixed
economies. Both pure socialism and pure free markets represent theoretical constructs only.

1- Merits of Mixed Economy:

▪ Encouragement to Private Sector

 ▪ Optimum Use of Resources

▪ Lesser Economic Inequalities

▪ Competition and Efficient Production

▪ Social Welfare

▪ Freedom

2- Demerits of Mixed Economy:

▪ Un-stability

▪ Ineffectiveness of Sectors

▪ Corruption and Black Marketing

▪ Delay in Economic Decisions

▪ More Wastages

▪ Threat of Nationalism

III- DIFFERENCES IN THE ECONOMIC SYSTEMS

A- Capitalism vs. Socialism

In terms of political economy, capitalism is often pitted against socialism. The fundamental
difference between capitalism and socialism is the ownership and control of the means of
production. In a capitalist economy, property and businesses are owned and controlled by
individuals. In a socialist economy, the state owns and manages the vital means of production.
However, other differences also exist in the form of equity, efficiency, and employment.

• Equity

The capitalist economy is unconcerned about equitable arrangements. The argument is that
inequality is the driving force that encourages innovation, which then pushes economic
development. The primary concern of the socialist model is the redistribution of wealth and
resources from the rich to the poor, out of fairness, and to ensure equality in opportunity and
equality of outcome. Equality is valued above high achievement, and the collective good is
viewed above the opportunity for individuals to advance.

• Efficiency

The capitalist argument is that the profit incentive drives corporations to develop innovative
new products that are desired by the consumer and have demand in the marketplace. It is argued
that the state ownership of the means of production leads to inefficiency because, without the
motivation to earn more money, management, workers, and developers are less likely to put
forth the extra effort to push new ideas or products.

• Employment

In a capitalist economy, the state does not directly employ the workforce. This lack of
government-run employment can lead to unemployment during economic recessions and
depressions. In a socialist economy, the state is the primary employer. During times of
economic hardship, the socialist state can order hiring, so there is full employment. Also, there
tends to be a stronger “safety net” in socialist systems for workers who are injured or
permanently disabled. Those who can no longer work have fewer options available to help them
in capitalist societies.

B- Mixed System vs. Pure Capitalism

When the government owns some but not all of the means of production, but government
interests may legally circumvent, replace, limit, or otherwise regulate private economic
interests, that is said to be a mixed economy or mixed economic system. A mixed economy
respects property rights, but places limits on them.

Property owners are restricted with regards to how they exchange with one another. These
restrictions come in many forms, such as minimum wage laws, tariffs, quotas, windfall taxes,
license restrictions, prohibited products or contracts, direct public expropriation, anti-trust
legislation, legal tender laws, subsidies, and eminent domain. Governments in mixed economies
also fully or partly own and operate certain industries, especially those considered public goods,
often enforcing legally binding monopolies in those industries to prohibit competition by
private entities.

In contrast, pure capitalism, also known as laissez-faire capitalism or anarcho-capitalism, (such

as professed by Murray N. Rothbard) all industries are left up to private ownership and
operation, including public goods, and no central government authority provides regulation or
supervision of economic activity in general.

The standard spectrum of economic systems places laissez-faire capitalism at one extreme and
a complete planned economy—such as communism—at the other. Everything in the middle
could be said to be a mixed economy. The mixed economy has elements of both central planning
and unplanned private business.

By this definition, nearly every country in the world has a mixed economy, but contemporary
mixed economies range in their levels of government intervention. The U.S. and the U.K. have
a relatively pure type of capitalism with a minimum of federal regulation in financial and labor
markets—sometimes known as Anglo-Saxon capitalism—while Canada and the Nordic
countries have created a balance between socialism and capitalism.
 Conclusion

Globalization has been driven by various factors which are interconnected and interrelated in
complex ways.