INTERNATIONAL BUSINESS Essay Example | Topics and Well Written Essays - 2000 words

INTERNATIONAL BUSINESS - Essay Example The regions that harbored this paradigm shift are the United States, Japan and Europe; which have been deemed as the Triad. After establishing a strong industrial base, many corporations in this region have expanded globally, particularly dispersing operations across the globe where economies of scale could be achieved in a cost-effective manner. A main feature of the past few decades has been the shift from labor intensive industries to capital intensive industries, consequently, labor activities have been shifted to less developed regions where labor cost is law and there is relatively less restraint posed by labor regulations. (Ohmae, K., 1983) While some scholars deem this transfer of functions as neo-colonialism, since most of the profits gained by virtue of these activities are diverted towards the operating MNE’s, our focus remains on the peculiar relation between multinational enterprises and small-medium enterprises that operate locally. Since Greenfield ventures are a rarity in the current sociopolitical environment, trade activities are spearheaded by focus on usage of factors of production, in particular, labor. Most of the major global corporations make use of ‘outsourcing’, delocalizing certain operational functions to push their costs down. This symbiotic relationship is possible due to particular philosophies that are distinct to the two major players here: MNEs have a focus on product innovation while local SMEs have a focus on process innovation. MNEs provide the financial and technological capital required, while SMEs facilitate production with an optimal production process. Inevitably, the SMEs, which are mostly situated in LDCs, are forced to specialize in the particular function that they are catering to. MNEs provide SMEs an opportunity they wouldn’t otherwise have in the form of markets that demand products requiring their services. It is usually the lack of local demand that inhibits many SMEs from growth and expansion. This notion is also supported by Porter’s diamond model, which suggests that in order for an industry to flourish in a national context, the local demand must be anticipatory of foreign demand. Since such is not the case in most LDCs, MNEs provide an opportunity for SMEs to expand and grow by increasing volumes of operation. Exposure to newer markets is also accompanied by the advent of newer technologies, capital and managerial skills.( Wright, R, W., & Russel, C, S., 1975) This in turn not only effects the SMEs in contact, but the local community involved as well in terms of employment. Ironically, the necessary technological capital required for SMEs is provided mainly from the Triad region. This obviously entails a certain monopolistic relation that is a feature of MNE-SME cooperation. What is deemed as an inequality, automatically translates to social indicators and economic factors as well. Some scholars label this relation as the dependency theory, which sta tes that countries within the core are capital intensive nations that are able to maintain this superiority using their vast accumulated capital which focuses on innovation and technology, while lesser important functions are transferred to the peripheries which provide the necessary labor and raw material for industries to operate but are not allowed to accelerate beyond that. Lack of knowledge transfer is

Public Finance Assignment Example | Topics and Well Written Essays - 4500 words

Public Finance - Assignment Example This deals with the cause that is behind the problem and assists the market in its efficient working; rather than substituting the market having complex propaganda involving too technical information, in other words unique service, a case for intervention in production and allocation of the service is highly possible. Synchronization problems may be prevented through the incorporation of public firms and thus market breakdown can be avoided. Co-ordination hazards are mainly prominent in the presence of huge and non-uniform groups of capable beneficiaries, anonymous shared concerns, high initial expense of synchronization, or, no inducement or mechanisms placed to defeat the problem of free rider.   Intervention for social fairness or equity causations are dependent on subjective verdicts and judgments made by democratically legally obligated politicians, still a market breakdown framework should be utilized by informing decisions and ensuring the desired effect is acquired in the b est effective way.    In the replica of a segment of flats, beneficial co-operation are held within a  parametrically small group having the same benefit, i.e., the advantages are non offensive. It is a Representation of an admixed public good. Persons and firms possibly accede to defeat market crashes where:   †¢ the capable beneficiaries are somewhat a not so large group and so the effort conceding and adjusting is low.   †¢ The probable beneficiaries are unvarying group5 and that is why the advantages are esteemed equally.   †¢ Although some assignees will have a ‘free ride’ on others investments   the confidential advantages of the considerate activities are supposed to be larger than the confidential expenses of consignment / adjustment.   †¢ There are lures or mechanisms for overcoming free riding. Top of Form Bottom of Form For other consequences, such as huge and non-uniform groups of expected beneficiaries, there is possibly an affair for civil interruption to encourage, authorize or speed the co-operation. Public interruption might include:   †¢ relieving few risks to the private abettors of initial expense of adjustment.   †¢ Mechanisms for administering collective verdicts to defeat the problem of free rider.   †¢ Mechanisms for persons with shared concernment to search for one another. As an example, promoting tourism possibly requires public sector consignment because the capable successors are a big and heterogeneous assemblage with some bargains likely to be beneficial more than all the other – it is attainable that both hotel keepers and business owners would benefit as a result of increase in tourist to London although the benefits of the hoteliers possibly is greater.   Civil sector consignment may also become a necessity to react to the massive events which impact many people, like a natural disaster which can also cause temporary distresses to market. In cases lik e this, only the civil sector usually has the capacity of organizing and mobilizing a tactical reaction.  (Musgrave, 2004; Brown and Jackson, 1990). Why should the public sector intervene in the economy? Some goods as well as some services maintain few specific trends, which definitely tell us that in an open competitive market