Other Determinants of Development Geography and Education(跨国公司管理-北外,董丽丽).ppt

Other Determinants of Development: Geography and Education Geography and Education Implications for Business Benefits Costs Risks Benefits size of the market present wealth (purchasing power) of consumers likely future wealth of consumers Costs Political costs Economic costs legal factors Risks Political Risk (1979 Iran revolution) Likelihood that political forces will cause drastic changes that adversely affect profits and other goals. Economic Risk (1997 Asian financial crisis) Likelihood that economic mismanagement will cause drastic changes that adversely affect profits and other goals. Legal Risk (1970’s India) Likelihood that a trading partner will opportunistically break a contract or expropriate property rights. Attractiveness politically stable (unstable) free market systems (command economy ) economically developed or developing? Case: p106 Disney in France Team work Team work US Japan Europe China vs. Mexico China vs. India Team work location political system economic system capital head of state main trading partner custom culture etc. Helpful Websites /www/background_notes /psd/compete.nsf *McGraw-Hill Companies, Inc., 1999 “Throughout history, coastal states, with their long engagements in international trade, have been more supportive of market institutions than landlocked states, which have tended to organize themselves as hierarchical (and often military) societies. Mountainous states, as a result of physical isolation, have often neglected market-based trade. Temperate climes have generally supported higher densities of population and thus a more extensive division of labor than tropical regions.” -Jeffrey Sachs- 5-3 5-3 Singapore Population: 2.8 million Literacy rate: 91.1% GDP ($B): 83 Per Capita GDP: $29,000 Strategic location: Malacca Straits World’s second busiest port: cargo tonnage Average GDP growth over 25 years: 8% 5-3 Another Example 5-3 Pakistan vs. Korea 5-4 5-4-1 5-4-2 5-4-3 5