International Business and

Globalisation
 
311 MANEL
Governmental Influence on Trade

Week 2 – Session 3
You need to attend all the sessions on time,
otherwise you will be marked as ABSENT.

&
NO SOCIAL MEDIA BE ON TIME
International Business and
Globalisation
Institutional Factors Affecting the Flow of Trade

Figure Institutional Factors Affecting the Flow of Goods and Service

Economic Rationales for Trade Restrictions

• To fight unemployment
• To protect infant industries
• To develop an industrial base
• Economic relationships with other countries
Why Government Intervenes in Trade

Table 7 Why Governments Intervene in Trade

Noneconomic Rationale for Trade Restrictions

• Maintain essential industries

• Promoting acceptable practices abroad
• Maintain or extend spheres of influence
• Preserve national culture
Instruments of Trade Control: Tariffs

• Tariff (Duty)
• Why are Tariffs levied?
• Types of Tariffs
Instruments of Trade Control: Non-tariff (1 of 3)

• Subsidies–Definition
• Agriculture Subsidies
 Instruments of Trade Control: Non-tariff (2 of 3)

• Aids and Loans

• Quotas
• Embargo
• Buy Local Legislation
• Standards and Labels
• Specific Permission Requirements
• Administrative Delays
Instruments of Trade Control: Non-tariff (3 of 3)

• Service Industries
• Four factors to consider
• Essentiality
• Not-for-Profit Services
• Standards
• Immigration
 References
Essential Reading
• Wild, J., & Wild, K. (2010). International Business: the Challenges of
Globalisation. 6th Ed. New Jersey: Prentice Hall.
• Daniels, J., Radebaugh, L. and Sullivan, D. (2014) International
Business: Environments and Operations. 15th edn. Harlow: Pearson
Recommended Reading
• Dicken, P. (2010). Global Shift: Mapping the Changing Contours of
the World Economy. 6th Ed. Los Angeles: Sage Publications.
• Hill, C. and Hult, G. (2015) Global Business Today. 9th edn. New
York: McGraw Hill
• Peng, M. and Meyer, K. (2016) International Business. 2nd edn.
Andover: Cengage Learning