Chapter 1

International Business

Globalization

Ha Noi, Foreign Trade University

< International Business >
Investment
Trade
Manufacture
><
Profit
Go … Global
What is Globalization ?

Integration
Globalization refers to the shift toward a more
integrated and interdependent world economy
(Charles. W. Hill)
 Globalization 1.0 (from 1492 to 1800)

The Stages Globalization 2.0 (from 1800 to 2000)

of
Globalization
(From Thomas Friedman in The World is Flat)

Globalization 3.0 (from 2000 to the present)

IN FOCUS
- Business concept
- Economies

BROADER VIEW
- Emerging trend
- Transparency
- Economies, Politics, Cultures…
 Globalization of
Markets
…refers to the merging of historically distinct
and separate national markets into one huge
global marketplace

- Falling trade barriers  easier to sell

internationally

-The tastes and preferences of consumers are

converging on some global norms

- Same basic products worldwide

- “German market” or the “American market”,

only the global market
 Globalization of
Production
…refers to the sourcing of goods and services from
locations around the globe to take advantage of
national differences in the cost and quality of
factors of production like land, labor, and capital

- Companies compete more effectively by

lowering their overall cost structure or
improving the quality or functionality of their
product offering
 Drivers of Globalization
-The decline in barriers  free flow of goods, services, and capital. (GATT, WTO)

- The technological changes (productions, telecom, transportation..)

 Debate
• Agree or Disagree?
• 8 opinions
• 3 mins/each
Support…
- New production and
business opportunities
- New markets, new
production sources
- Lower prices for goods
and services.
- Greater economic growth
- Higher consumer income,
and more jobs
 … Anti
- Firms collapse, job losses
- Wealth - Poverty gap
- Child, women labor
- Environmental degradation
- The cultural imperialism of global
media and MNEs
- Financial crisis
- Country sovereignty