International Business 1

Globalization Affects on Domestic Business Practices.

Jack F. Gowen, Sr.

Keiser University Graduate School

International Business

MBA 551

Professor: Dr. Tiffany Jordan

10/31/2010

International Business 2

The basic principal of business is to supply the market demand, with a viable product,

that is more enticing, than the competition. I am sure we wished that it were that simple. State

and federal laws regulate domestic commerce. The critique addresses whether Domestic or

International Business principals taught separately or jointly. Just as Domestic Business,

practices must adhere to local regulations; International Business transactions conducted in

accordance with Domestic and International laws. (Hill. 2009)

The fundamental paradigm shift from national, to world economies, has placed us square

within the debate of the virtues of conducting international business transactions. The author of

our text Charles Hill list two reasons in support of globalization, “decline in trade barriers, and

the free flow of goods, services, and capital. Technological advances in communication,

information processing, and transportation, makes international trade assessable.” (Hill, 2009, p.

11) Leading economist shared their opinions concerning international trade. “The international

trade and investments are the twin engines driving the global economy.” (Hill, 2009, p. 24)

The four institutions that regulate global commerce are the “World Trade Organization”

(WTO), “International Monetary Fund” (IMF), “World Bank” (WB), and the “United Nations”

(UN). The WTO was set up to regulate trade agreements. The IMF was set up to regulate

international monetary and economic development. The WB was set up to offer low interest

loans to countries to ease their economic struggles, and promote growth. The UN developed into

an international body, to promote peace through collective cooperation, and security, currently

has 191 member nations. (Hill, 2009, pp. 9-10)

The four reasons given within our text why study international business in addition to

domestic business:

International Business 3

1. Countries are different (i.e., culture, traditions, and religions)

2. The range of problems faced by management is different, and more complex

3. Management needs to find ways to work within limits imposed by government intervention,

international trade, and investment system

4. International transactions involve converting money into different currencies

(Hill, 2009, p. 33) The reasons listed within our text support the need to teach international

business as a separate course.

Conclusion

The affects of Globalization on domestic business practices, has altered the way we

conduct business. The Global Market Place has enlarged competition. We compete with

domestic companies for market share, and now we against Global competition. The

Multinational Enterprises that compete within Global markets successfully have conducted

market analysis, assessing consumer demand, developing strategies to increase market share over

the competition. The laws and regulations that each country who belong to the World Trade

Organization, and other import, export cartels. The difference in laws and labor standards

between trading countries, outside of WTO membership pose a legal and ethical dilemma,

because the labor laws, trade regulations, are in contrast to ethical behavior. The World Trade

Organization, is part of the United Nations, there are standards set for membership. We are living

within a Global society, and the consequences are the affects other countries have upon other

countries’ economies. Once the Jeannie is out of the bottle, there is no going back.

International Business 4

References

Hill, Charles, W. L. (2009, International Business: Competing in the Global

Marketplace: New York: McGraw-Hill/Irwin