This free online course introduces you to international business and trade. We explore the role of the Bartlett and Ghoshal model in indicating the strategic options for businesses that want to manage their international operations based on shifting local, regional and global conditions. Multinational corporations incorporate in their home country and carry out business operations in many other foreign countries, exporting business functions from the domestic market. We investigate the complexities of international marketing, which applies marketing principles across borders to reach and open up new markets. We unpack how liberalization leads to the relaxation of government regulations and economic restrictions in exchange for a free flow of goods and services between countries, thus boosting the participation of private entities.
The course begins by introducing you to the fundamentals of international business and the various theories of international trade. We then discuss the regionalized model, which states that the company keeps its headquarters in one country and maintains offices elsewhere. This normally entails an executive headquarters in the home country and various manufacturing plants and production facilities abroad. ‘Factor mobility’ refers to the free movement of the factors of production such as labour and capital across national borders. We explain how ‘complementarity’ captures the factor mobility that comes through foreign direct investments, which may stimulate foreign trade because of the need for equipment, components and complementary products in the destination country. This helps you discover that income propagation is a multiplier concept that states that the income spread is a ‘natural’ process. It also states that an increase in employment, income and output is due to an increase in investment.
The course then moves on to the ‘investment multiplier’, which refers to the ratio of change in the equilibrium income and the change in investment that causes it. We break down the ‘foreign trade multiplier’ that refers to the amount by which the national income of a country will rise due to a unit increase in the domestic investment in exports. This illustrates that business decisions, particularly strategic ones, need clear identification of the relevant variables and detailed analysis in order to predict their impact on the organization. We make clear how the ‘micro’ approach to environmental analysis takes a narrow view of the business environment and then forecasts immediate changes. This enables you to identify existing and emerging threats in time to formulate appropriate strategies. We wrap up demonstrating the importance of investment mode of entry into a new market. This course suits business students or anyone looking to break into international trade. We can also help you if your company seeks to conduct business across borders.
