Government Intervention And Its Effect On Foreign Markets Essay

If you are ready to start doing business on an international level, there are some considerations to keep in mind. These five tips will help to ensure a successful business venture in the global market.

There are many businesses that have expanded their business internationally in order to benefit in some sort of way rather it revenue or a better market for their product. In this thesis, I will research a multination company and its international strategy over the last 10 years. I will elaborate on it international orientation and rather it etho-, poly-, or geocentric. I than explain why the company decided on expanding to the chosen locations. Then I will clarify if they had core capability to succeed in those markets, along with its

Doing business overseas takes time and patience. It requires new relationships to be established; therefore, it is important to have an established business model that works according to plan. The most favorable markets are politically stable developed and developing nations with free market systems, low inflation, and low private sector dept. The less desirable markets are politically unstable developing nations with mixed or command economies or developing nations where speculative financial bubbles have led to excess borrowing.

In a time of global commerce, new business ventures can take on many forms. What used to be local or even national companies have become world-wide. International growth of a business can be extremely beneficial but is not without its challenges. Different countries have different peoples and different cultures - different ways of doing business altogether. If a venture is to be successful, these differences must be well understood.

Government plays a crucial role in the market economy by ensuring the laws and regulation are abide by, and control the production of the private sectors, although, over the years its efforts in controlling such economies are minimal and insignificant. Market forces of demand and supply play a major role in setting trends that such market economies follow. Economic growth, inflation, interest rates, wage rates of workers and unemployment rates are some of the fields the government takes part in controlling, to boost the Gross National Product (GNP) of the state.

The government does not necessarily need to intervene how the marker goes. Therefore, the competition is a significant factor of the free marker economy.Active but limited government is another main part of the free market economy. This means that the government undertakes a significant, active role in the market, but at the same time the government’s role is ver limited because all the investments and decisions in the economy are controlled by the market than by the government. An invisible hand will control the market. Limited government is a type of government in which there is a minimum intervention in personal properties. Overall, the government tries to keep the economy in a law and let it free by limiting itself. Hence, the limited government is an essential factor of the free market economy.Last, self-interest is a significant part of the free market economy. Self-interest refers to one’s desire to buy something. The market will be generally controlled by people’s interest; the companies will compete with one another to fit the best taste. This is because the people’s interest will be the main trend in the market and it will control what should be made in the market. Consequently, the market will be self-regulated according to the theory of a free market. Therefore, the self-interest is another significant factor of the free market economy.Therefore, the competition, the

A state chooses its economic system by answering three important questions: what goods need to be produced, how will they be produced, and who are they being produced for? The two main economic structures used in the world today are command and market systems. In a command system, everything relating to the economy, such as production, employment, and wages, is controlled by a central planning authority in the government. The government decides what goods will be produced, how they will be priced, and who they will be distributed to. Command economies are designed to benefit the entire population rather than the individual consumer. On the other end of the spectrum is the market economy; government interference is kept to a minimum in this

Hill, C. (2011). International business, competing in the global marketplace. (8 ed.). New York, NY: McGraw-Hill Irwin.

Many companies today want to expand their business to the international business, which can bring cost down and profits up. Taking a business internationally means knowing the rules and regulations of the countries you are entering. There can be many issues with going global which include cultural barriers, diversity issues, multicultural issues, political issues, and economical issues. It is very important to know how important expansion is to the company and what implications will come from going global.

Free market is allocated by individuals and firms responding to supply and demand. The government has many roles in the market society such as protecting property rights, providing public goods and services, resolving market failures and etc. Even though the government doesn’t control the free market, sometimes it needs to have an intervention and to create a better society. A government intervention is necessary to the free market especially for negative externalities, property rights, and income redistribution.

Based on Tata Group’s experience, we can see the advantages and drawbacks of going international as follows:

As discussed in Chapter 21 of our text book, any company that is looking to expand globally must make five key decisions. A firm must decide if: a) they really want to expand to the international market; b) they

There are always business risk when it comes to expanding a company, especially from an international standpoint. There are many strategic risk that needs to be evaluated in order to expand the company successfully. Examining the possible risk of foreign currency exposure, basic functions of international banking/financial market, support of long term financing of operations, and assessment of opportunities that can be implemented within the company. There are risk on three dimensions of international finance, economic trends of the country, impact of globalization and monetary system. All of these situations will be discussed in this paper.

Companies can decide to go global or to enter international markets for various reasons, and these different objectives at the time of entry that enable the business to produce different strategies and the performance goals, and even forms of market participation.

International business is much more complex than operating within the domestic market because countries are extremely different in many ways. The