40 Questions
What is a challenge to the effectiveness of strikes in some situations?
The ability of organisations to hire temporary workers
What is a characteristic of Italy and Greece in terms of economic action?
Clustering of economic action and a larger public sector
What is a consequence of widespread corruption in a society?
Increased poverty and populism
What is a key factor in determining the effectiveness of anti-corruption reforms?
Poverty reduction strategies
What is a characteristic of weak institutions?
Beliefs in unchecked executive power
What is a reason why people in Italy and Greece may not want a cashless society?
They do not trust the government to use tax money effectively
What is a consequence of a society with weak institutions and strong firms?
Increased corruption and burdens on the poor
What is a key difference between strong and weak institutions?
The level of corruption and bribery
What might be a reason why Chinese workers do not consider housing by their employer as a limitation of freedom?
They value security over independence
What is a consequence of losing a job in the Chinese situation?
Loss of housing and having nowhere to go
What is a possible explanation for the difference between Chinese and UK workers' attitudes towards housing and employment?
Cultural differences in values and expectations
What is the impact of a forced decision on a person's enjoyment of things?
It has a negative impact, as it affects the way people enjoy things
What is a possible reason why Chinese workers may want to live independently?
They want to experience the freedom of living on their own
What is the significance of the distinction between 'want to' and 'have to' in the context of decision-making?
It emphasizes the role of autonomous choice in decision-making
What is the primary role of the United States in the global economy, according to the given information?
Protecting American interests through military power and influence in international institutions
What is the significance of Wall Street in the financial world?
It is a bellwether for other stock markets, with a significant market capitalization
What is the market capitalization of the NYSE in September 2023?
$25.24 trillion
What percentage of profits are used for dividends or share buybacks, according to the given information?
A high percentage of profits
What is the consequence of economic turmoil in the labor market?
Dismissal and job losses
What is the role of institutional investors in the financial markets?
They are not inclined to direct the companies they own
What is the effect of high frequency of takeovers in the financial markets?
It disciplines underperforming companies
What is the market capitalization of BlackRock’s assets under management in Q3 2023?
$9.1 trillion
What is a common issue with forcing vaccinations on staff?
It lowers vaccination rates.
What was the outcome of the Supreme Court's decision on Covid mandates by Biden in 2021?
90% of federal workers got a first dose before the deadline.
Why do private companies continue to force vaccinations despite the Supreme Court's decision?
Because they want to promote a healthy workforce.
What is a common pay practice in the US business system?
Performance-based pay.
What is a common guideline in the US business system?
Relative pay scales (e.g., above the median).
What is a growing trend in the US business system?
Growing reliance on forced distribution (10-80-10).
What is an example of a benefit offered by some US companies?
Stock option plans.
What is a common practice in US multinational enterprises (MNEs)?
Applying grade systems for all kinds of workers.
What was the estimated economic impact of the strike on the government?
$6 billion
Which of the following was a result of the WGA strike?
A 5% pay increase for writers in the first year
What was the purpose of Joe Biden's Inflation Reduction Act (IRA) in 2022?
To incentivize people to buy EVs from certified producers
Why did Joe Biden openly dislike Tesla?
Because Tesla did not unionize its workers
What was the result of the Ultium battery plant vote in Ohio?
The plant voted to unionize
What was the goal of Joe Biden's plan to have 500,000 charging stations on US highways in 2030?
To increase the number of EVs on the road
What was the outcome of the SAG-AFTRA strike?
A 7% pay increase for actors
Why did the US Treasury chief Janet Yellen visit Chile?
To discuss climate and energy goals with Chile
What was the impact of the strike on the cinemas?
The strike resulted in a loss of income for the cinemas due to delayed movie releases
What was the outcome of the United Auto Workers strike against Ford, GM, and Stellantis?
A 11% wage increase for workers
Study Notes
Weak Institutions and Weak Firms
- Italy and Greece have weak institutions and weak firms, characterized by:
- Local state laws and clustering of economic activity
- Larger public sector vs. private sector
- Less MNEs, more family businesses and local HRM practices
- Less innovation and exports
- Missing tax base
- Beliefs of unchecked executive power
Corruption
- Corruption matters:
- Burden of bribery is borne by the poor
- Corruption decreases with stronger institutions fighting corruption
- Less corruption with high social capital
- More corruption with strong political networks
- Anti-corruption reforms should include poverty reduction strategies
Our First Model: Strong and Weak
- Four possible scenarios:
- Strong institutions and weak firms
- Weak institutions and strong firms
- Strong institutions and strong firms
- Weak institutions and weak firms
Comparative Approach
- Understand what is going on in a nation by considering the past
- People act rationally in their own context
- Case study: UK and China
- Chinese workers may value security and expect employer-provided housing
- Chinese workers may not consider housing by the employer as a limitation of freedom
Financial Markets
- Wall Street is dominant in the financial world:
- $25.24 trillion market capitalization in September 2023
- 50% market share worldwide
- BlackRock's assets under management: $9.1 trillion at Q3 2023
- Berkshire Hathaway held $1 trillion at Q3 2023
The Labour Market
- Relatively speaking, the US labour market is deregulated:
- Fewer external obligations for companies
- Equal employment opportunities are the exception
- Consequence: economic turmoil = dismissal
The US Business System
- Pay and performance:
- Grade systems for all kinds of workers
- Individual performance-based pay
- Stock option plans for many
- Growing reliance on forced distribution
Strikes
- Negative impact of strikes:
- Cost of $500 million to Warner Bros
- Delay in movie production and release
- Hurt to cinemas and the government
- Estimated economic impact of $6 billion
Case: United Auto Workers
- Strike against Ford, GM, and Stellantis:
- First time the union strikes against all three at once
- 145,000 workers employed, producing 50% of vehicles annually
- The union chose to strike in the most profitable factories
- Deals made with Ford, GM, and Stellantis:
- 25% wage increase over 4.5 years
- $5,000 ratification bonus
- End to the two-tier system
Background
- Joe Biden's Inflation Reduction Act (IRA) in 2022:
- Incentives for people to buy EVs
- $7,500 tax credit for an EV from a certified producer
- $4,500 additional tax credit if the EV was made with unionized labour
- Targeted car manufacturers that have no union, like Tesla
Joe Biden's Support for the UAW
- Openly pro-union:
- Used Ford, GM, and Stellantis to push Tesla into unionizing
- Did not invite Elon Musk to the White House
- Supported the UAW during the strike
- Joined the picket lines in Michigan
HR in US MNEs: Workplace Diversity
- American Civil War (1861-1865):
- Abolishing slavery
- Civil rights movements:
- 1865-1896, 1896-1954, and 1960s
- 1954: Supreme Court declares laws legalizing racial segregation and discrimination as unconstitutional
- Civil Rights Act of 1964 banning all discrimination based on race
- Managing workforce diversity:
- Focus on gender diversity
- Gender balance: Resistance to quotas indicates lack of genuine concern
This quiz covers the impact of industrial relations on international business, including the role of strikes, temporary workers, and institutional frameworks in different countries.
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