International Business Chapter 1 Revision

Resources that cannot be moved from one country to another, such as land, labor, or natural resources.

A type of foreign direct investment where a firm establishes a new company or acquires an existing company in a foreign country.

An investment made by a company in another country that gives them significant control over the acquired company.

Advantages enjoyed by firms when they internalize cross-border transactions within their own organization, rather than outsourcing them to independent firms.

The potential for foreign firms to benefit from the knowledge and expertise of local firms in the host country.

An advantage that motivates firms to invest abroad, particularly when they fear losing control over their unique knowledge, technology, or processes.

A type of foreign direct investment where a firm invests in a foreign company or venture to exploit its established market presence or resources.

A type of foreign direct investment where a firm invests in related activities within the same value chain in a foreign country, such as manufacturing and distribution.

A view of Corporate Social Responsibility stating companies have a moral duty to do better than just increasing shareholder value.

A business practice that aims to achieve positive outcomes for society, the environment, and economic performance.

A region that attracts polluting industries due to lax environmental regulations, attracting businesses seeking to minimize compliance costs.

A proactive strategy where companies actively seek to engage in social and environmental initiatives even beyond legal requirements.

The belief that companies are only obliged to engage in CSR activities that directly or indirectly benefit shareholder value.

A set of rules and principles that companies adopt to guide their ethical behavior and ensure their business operations align with societal values.

The idea that companies have a responsibility to follow social and environmental regulations and guidelines.

A situation where countries compete to attract foreign investors by offering less strict labor regulations, often resulting in lower wages and weaker labor protections.

The mechanism where buyers and sellers interact to determine the price of goods and services.

A form of economic system where the government controls and directs all aspects of production, distribution, and consumption.

The legal right to own, use, and dispose of something.

A scholarly school of thought that emphasizes the role of institutions, both formal and informal, in shaping economic outcomes.

A theory examining how different countries organize their economic systems and institutions, based on their historical, cultural, and political contexts.

A type of risk that arises from political instability, changes in government policy, or other events that may affect a company's operations in a foreign country.

A collection of shared values, beliefs, assumptions, and behaviors that guide the actions of a group of people.

A culture where communication relies heavily on implicit cues, body language, and context.

A strategic decision to carry out a process, such as production or customer service, outside the company, often in a different country where labor costs are lower. This can help reduce costs and increase efficiency.

This process involves comparing a company's resources and capabilities to those of an industry leader to identify areas for improvement. It helps companies benchmark and improve their performance.

A company's commitment to operating in an ethical and socially responsible manner, taking into account the impact of its actions on employees, customers, the environment, and the community.

These are individuals or groups that have a stake in a company's success, such as employees, customers, investors, suppliers, and the community. They are often affected by the company's actions.

A framework for analyzing a resource or capability based on whether it is valuable, rare, inimitable, and organized. It helps identify a company's competitive advantage.

The practice of relocating production facilities or operations to another country, often in a less developed country where labor costs are lower.

These are guidelines or principles that MNEs create to ensure their operations and supply chains adhere to ethical and socially responsible standards. They cover areas like labor rights, environmental protection, and fair business practices.

The pressures that may or may not induce MNEs to employ lower labor standards in countries outside their home base.

A legal agreement that transfers the rights to use a brand name, technology, or both, and can establish long-term supplier relationships.

When companies join forces to bid for a contract, often a large project like a government contract.

A project arrangement where a private company builds, operates, and then eventually transfers ownership of an infrastructure project like a bridge.

Any business activity that goes beyond national borders, involving interactions with foreign companies, customers, or suppliers.

A contractual agreement where a company grants permission to another company to operate a business using their brand, trademarks, and operating model.

A type of international business arrangement where a local company owns the property and a hotel chain manages the hotel's operations using their brand and systems.

Rights, granted by a company, to another company in a specific region to operate under their brand and run franchised businesses.

A model suggesting that companies progress through stages of internationalization, starting with exporting and gradually increasing their commitment and involvement in foreign markets as they gain knowledge and experience.

A firm's strategic approach that aims to combine the benefits of global integration (efficiency) and local adaptation (responsiveness) to different markets, achieving both cost advantages through standardization across borders and responsiveness to local needs.

The formal systems and processes used by multinational enterprises (MNEs) to manage knowledge, including its creation, sharing, integration, and utilization across different subsidiaries and departments.

The proactive initiative taken by MNE subsidiaries to persuade their headquarters to expand their responsibilities and decision-making power.

A challenge to knowledge sharing in large multinational organizations where teams or subsidiaries are hesitant to adopt or learn from ideas originating outside their own group. It reflects a 'we know best' attitude.

The embedded, unspoken knowledge that resides within individuals' skills, experiences, and know-how, often challenging to articulate or transfer easily.

The role played by employees who are sent to work in a foreign subsidiary of their company, often for a specific period. They bring expertise and knowledge, facilitating cultural exchange and building relationships across borders.

The systematic approach to managing talent globally, including recruitment, development, and retention strategies, aiming to attract, develop, and retain high-performing individuals across different locations.

A training method that immerses expatriates in the culture, language, and business practices of their host country through intensive language classes, cultural awareness workshops, and simulations.