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Inter Bus
| Question | Answer |
|---|---|
| Legal system | Rules of the game on how a country’s laws are enacted and enforced |
| Democracy | System in which citizens elect representatives to govern the country on their behalf |
| Totalitarianism (dictatorship) | System in which one person or party exercises absolute political control over the population |
| Institutions | “rules of the game” |
| Institutional transitions | Fundamental and comprehensive changes introduced to formal and informal rules of the game that affect firms as players |
| Institution-based view | success and failure of firms are enabled and constrained by institutions |
| Institutional framework | Formal and informal institutions governing individual and firm behavior |
| Formal institutions | Laws, regulations, and rules - may be imposed by home countries and host countries |
| Norms | Values, beliefs, and actions |
| Regulatory pillar | Coercive power of governments |
| Normative pillar | How values, beliefs, and actions of other relevant players influence behavior of focal individuals and firms |
| Cognitive pillar | Internalized, or taken for-granted, values and beliefs that guide individual and firm, or group, behavior |
| Transaction costs | Costs associated with economic transactions or, the costs of doing business |
| Opportunism | Act of seeking self-interest with guile |
| Political system | Rules of the game on how a country is governed politically |
| Political risk | Risk associated with political changes that may negatively impact domestic and foreign firms |
| Civil law | Comprehensive statutes and codes as a primary means to form legal judgments |
| Common law | English origin, shaped by precedents and traditions from previous judicial decisions |
| Theocratic law | Based on religious teachings |
| Property rights | Legal rights to use an economic property (resource) and derive income and benefits from it |
| Patent | Legal rights awarded by government authorities to inventors of new products or processes |
| Copyright | Exclusive legal rights of authors and publishers to publish and disseminate their work |
| Trademark | Exclusive legal rights of firms to use specific names, brands, and designs to differentiate their products from others |
| Ethnocentrism | To perceive one’s own culture, ethics, and norms as “natural, rational, and morally right.” |
| Context | The underlying background upon which social interaction takes place |
| Low-context cultures | Communication is usually taken at face value without much reliance on unspoken context |
| High-context cultures | Communication relist a lot on the underlying unspoken context, which is as important as the words used |
| Cluster | Countries that share similar cultures |
| Ronen and Shenkar clusters | Influential set of clusters proposed by management Professors Simcha Ronen and Oded Shenkar |
| GLOBE clusters | Influential set of clusters named after the Global Leadership and Organizational Behavior Effectiveness project led by management professor Robert House |
| Foreign Corrupt Practices Act (FCPA) | A US law enacted in 1977 that bans bribery of foreign officials |
| Resource-based view | Certain resources and capabilities specific to one company are not shared by competitors. |
| Outsourcing | Turning over an organizational activity to an outside supplier that will perform it on behalf of the focal firm. |
| Captive sourcing | Setting up subsidiaries abroad so that the work done is in-house but the location is foreign. Also known as foreign direct investment (FDI). |
| Offshoring | Oursourcing to an international or foreign firm. |
| Inshoring | Outsourcing to a domestic firm |
| VRIO Framework | Resource-based view focusing on the value (V), rarity (R), imitability (I), and organizational (O) aspects of resources and capabilities |
| Original equipment manufacturer (OEM) | Firm that executes design blueprints provided by Western firms |
| Original design manufacturer (ODM) | Firm that executes manufacturing based on their own design blueprints |
| Original brand manufacturer (OBM) | Firm that executes manufacturing based on their own design blueprints and sells the product under their own brand name |
| Classical trade theories | (1) Mercantilism (2) Absolute Advantage (3) Comparative advantage |
| Modern trade theories | (1) Product Life Cycles (2) Strategic trade (3) “Diamond” |
| Voluntary export restraint (VER) | Exporting countries voluntarily agree to restrict their exports |
| Multinational enterprise (MNE) | Firms that engage in FDI |
| Foreign portfolio investment (FPI) | Holding securities, such as stocks and bonds, of companies in countries outside one’s own but does not entail the active management of foreign assets |
| Horizontal FDI | Producing the same products or offering the same services in a host country as firms do at home |
| Vertical FDI | Firm moves upstream or downstream in different value chain stages in a host country through FDI |
| OLI advantages | Quest for ownership (O) advantages, location (L) advantages, and internalization (I) advantages |
| International Monetary Fund (IMF) | An international organization established to promote international monetary cooperation, exchange stability, and orderly exchange arrangements |
| Purchasing power parity (PPP) | Conversion that determines the equivalent amount of goods and services different currencies can purchase |
| Global economic integration | Efforts to reduce trade and investment barriers around the globe |
| Trade-Related Aspects of Intellectual Property Rights (TRIPS) | WTO agreement governing intellectual property rights |
| Monetary union | A group of countries that use a common currency |
| Free trade area (FTA) | Group of countries that remove trade barriers among themselves |
Created by:
bmrolan
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