Chapter 5 Global Business Today

900 Words Feb 23rd, 2012 4 Pages
Andrea Innes
Review Questions
March 8, 2012

Global Business Management
Terri Brown

3. Unions in developed nations often oppose imports from low-wage countries and advocate trade barriers to protect jobs from what they often characterize as “unfair” import competition. Is such competition “unfair?” Do you think that this argument is in the best interests of (a) the unions (b) the people they represent (c) The country as a whole

The Comparative advantage theory says that if a country should specialize in producing those goods that it can produce most efficiently, while buying goods that it can produce relatively less efficiently from other countries. It also says that opening a country to free trade stimulates
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China is limiting its imports by following an import substitution policy. Although in 2007 the import growth exceeded the export growth, which does point toward change in their policy. Other countries should continue to put pressure on China to let their currency appreciate, and maintain open markets.

6. Reread the Country Focus “Moving U.S. White-Collar Jobs Offshore.” Companies are benefiting from rich countries such as the US to move their skilled jobs to developing countries or countries that have low-cost jobs. The U.S. loses these jobs because of globalization and the movement of these jobs and corporations outside of the country. Developing Countries like the U.S. would suffer from the loss of these jobs because we supported by these skilled jobs and are still developing, we would lose expertise. Developed countries would end up gaining these jobs because they have a lower cost and only seek to maximize performance and minimize costs. White-collar jobs are more important to a nation’s future and should remain at home. The government should focus on this issue. One thing the government could do is implement economic packages where benefits are given to companies that make their product completely and apply national rates to protect the economy.

7. Drawing upon the new trade theory and Porter’s theory of national competitive advantage, outline the case for government policies that would build national competitive advantage in
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