Includes bibliographical references and index.

Contents
Preface
About the Authors
Part I Background for International Business
Chapter 1 Globalization and International Business
Case: The Globalization of Professional Sports
Why Are Globalization and International Business Important?
The Forces Behind Globalization
Increase in and Expansion of Technology
Liberalization of Cross-Border Trade and Resource Movements
Development of Services That Support International Business
Growing Consumer Pressures
Increased Global Competition
Changing Political Situations
Expanded Cross-National Cooperation
Criticisms of Globalization
Threats to National Sovereignty
Economic Growth
Growing Income Inequality
Why Companies Engage in International Business
To Expand Sales
Point - Counterpoint Is Offshoring Good or Bad?
Acquire Resources
Minimize Risk
Modes of International Business
Merchandise Exports and Imports
Service Exports and Imports
Investments
International Companies and Terms to Describe Them
Why International Business Differs from Domestic Business
Physical and Societal Factors
The Competitive Environment
Looking to the Future Is Globalization Inevitable?
Summary
Case: Carnival Cruise Line
Chapter Notes
Part II Comparative Environmental Frameworks
Chapter 2 The Cultural Environments Facing Business
Case The Java Lounge: Adjusting to Saudi Arabian Culture
Introduction
Cultural Awareness
Identification and Dynamics of Cultures
The Nation as a Point of Reference
Cultural Formation and Dynamics
Language as a Cultural Stabilizer
Religion as a Cultural Stabilizer
Does Geography Matter?
Behavioral Practices Affecting Business
Social Stratification Systems
Work Motivation
Relationship Preferences
Risk-Taking Behavior
Information and Task Processing
Communications
Dealing with Cultural Differences
Accommodation to Foreigners
Cultural Distance: Usefulness and Limitations
Culture Shock
Point - Counterpoint Does International Business Lead to Cultural Imperialism?
Company and Management Orientations
Strategies for Instituting Change
Looking to the Future What Will Happen to National Cultures?
Summary
Case Charles Martin in Uganda
Chapter Notes
Chapter 3 The Political and Legal Environments Facing Business
Case China's Business Environment
Introduction
The Political Environment
Individualism and Collectivism
Political Ideology
Democracy
Totalitarianism
Trends in Political Systems
Looking to the Future Will Democracy Survive?
Political Risk
Point-Counterpoint Political Risk Management
The Legal Environment
Diffusion of Legal Systems
Legal Issues in International Business
Operational Concerns
Strategic Concerns
Intellectual Property Rights
Summary
Case Global Software Piracy
Chapter Notes
Chapter 4 The Economic Environment
Case McDonald's and Russia's Economic Transition
Introduction
International Economic Analysis
Elements of the Economic Environment
Gross National Income
Improving the Power of GNI
Features of an Economy
Inflation
Unemployment
Debt
Income Distribution
Poverty
The Balance of Payments
Point-Counterpoint Trade Deficits: Advantage or Crisis
Integrating Economic Analysis
Types of Economic Systems
Freedom, Markets, and Transition
Economic Freedom: Idea, Performance, and Trends
Transition to a Market Economy
The Means of Transition
Looking to the Future The Future of Transition
Summary
Case Meet the BRICs
Chapter Notes
Chapter 5 Globalization and Society
Case Environmental Challenges for Newmont Mining in Indonesia
Introduction
Evaluating the Impact of FDI
Trade-offs Among Constituencies
Cause-Effect Relationships
Individual and Aggregate Effects
Potential Contributions of MNEs
Economic Impact of the MNE
Balance-of-Payments Effects
Growth and Employment Effects
Foundations of Ethical Behavior
Cultural Foundations for Ethical Behavior
Legal Foundations for Ethical Behavior
Ethics and Bribery
Point-Counterpoint Is Bribery Ever Justified?
Ethical Behavior and Environmental Issues
Global Warming
Does Geography Matter? The Amazon
Ethical Dilemmas and Pharmaceutical Sales
Ethical Dimensions of Labor Conditions
Corporate Codes of Ethics
Looking to the Future Will FDI Be Welcome and Will Foreign Investors Act More
Responsibly as the Twenty-First Century Progresses?
Summary
Case Anglo American in South Africa
Chapter Notes
Part III Theories and Institutions: Trade and Investment
Chapter 6 International Trade and Factor Mobility Theory
Case Costa Rican Trade, Foreign Investment, and Economic Transformation
Introduction
Interventionist Theories
Mercantilism
Neomercantilism
Free Trade Theories
Theory of Absolute Advantage
Comparative Advantage
Some Assumptions and Limitations of the Theories of Specialization
Theories Explaining Trade Patterns
How Much Does a Country Trade?
What Types of Products Does a Country Trade?
With Whom Do Countries Trade?
Does Geography Matter?
The Dynamics of Trade
Product Life Cycle (PLC) Theory
The Porter Diamond
Point-Counterpoint Should Countries Follow Strategic Trade Policies?
Factor Mobility
Why Production Factors Move
Effects of Factor Movements
The Relationship of Trade and Factor Mobility
Looking to the Future
Summary
Case LUKoil
Chapter Notes
Chapter 7 Governmental Influence on Trade
Case Textile and Clothing Trade
Introduction
Conflicting Results of Trade Policies
Economic Rationales for Governmental Intervention
Unemployment
Infant-Industry Argument
Industrialization Argument
Economic Relationships with Other Countries
Noneconomic Rationales for Government Intervention
Maintaining Essential Industries
Dealing with "Unfriendly" Countries
Point-Counterpoint Should Countries Eliminate the Use of Trade Sanctions?
Maintaining Spheres of Influence
Preserving Cultures and National Identity
Instruments of Trade Control
Tariffs
Nontariff Barriers: Direct Price Influences
Nontariff Barriers: Quantity Controls
Dealing with Governmental Trade Influences
Looking to the Future
Summary
Case U.S.-Cuban Trade
Chapter Notes
Chapter 8 Cross-National Cooperation and Agreements
Case Toyota in Europe
Introduction
The World Trade Organization (WTO)
Gatt: The Predecessor
The WTO
The Rise of Bilateral Agreements
Regional Economic Integration
The Effects of Integration
Major Regional Trading Groups
The European Union
The EU's Organizational Structure
The Single European Act
EU Expansion
Trade Disputes Between the EU and the U.S.
Implications of the EU for Corporate Strategy
Main Challenges Facing the EU
North American Free Trade Agreement (NAFTA)
Rules of Origin and Regional Content
Special Provisions of NAFTA
Impact of NAFTA
NAFTA Expansion
Implications of NAFTA for Corporate Strategy
Regional Economic Integration in the Americas
Point-Counterpoint Is CAFTA a Good Idea?
Regional Economic Integration in Asia
Regional Economic Integration in Africa
Commodity Agreements
Producers' Alliances and ICCAs
The Organization of Petroleum Exporting Countries (OPEC)
Looking to the Future Will the WTO Overcome Bilateral and Regional Integration
Efforts?
Summary
Case Wal-Mart de Mexico
Chapter Notes
Part IV World Financial Environment
Chapter 9 Global Foreign Exchange and Capital Markets
Case Western Union
Introduction
Major Characteristics of the Foreign-Exchange Market
Brief Description of Foreign-Exchange Instruments
The Size, Composition, and Location of the Foreign-Exchange Market
Geography Matters Foreign Exchange Trades
Major Foreign-Exchange Instruments
The Spot Market
The Forward Market
Options
Futures
Foreign-Exchange Convertibility
How Companies Use Foreign Exchange
The Foreign-Exchange Trading Process
Commercial and Investment Banks
Global Capital Markets
Eurocurrencies
International Bonds: Foreign, Euro, and Global
Equity Securities and the Euroequity Market
Point-Counterpoint Speculation in Capital Markets
Looking to the Future The Future of Foreign Exchange and Global Capital Markets
Summary
Case HSBC and the Peso Crisis in Argentina
Chapter Notes
Chapter 10 The Determination of Exchange Rates
Case El Salvador and the U.S. Dollar
Introduction
The International Monetary Fund
IMF Assistance
Special Drawing Rights (SDRs)
Evolution to Floating Exchange Rate
Exchange-Rate Arrangements
From Pegged to Floating Currencies
The Euro
Point-Counterpoint Should Africa Develop a Common Currency?
Black Markets
The Role of Central Banks
The Determination of Exchange Rates
Floating Rate Regimes
Managed Fixed Rate Regime
Purchasing-Power Parity
Interest Rates
Other Factors in Exchange-Rate Determination
Forecasting Exchange-Rate Movements
Fundamental and Technical Forecasting
Factors to Monitor
Business Implications of Exchange-Rate Changes
Marketing Decisions
Production Decisions
Financial Decisions
Looking to the Future Changing Times Will Bring Greater Exchange-Rate
Flexibility
Summary
Case The Chinese Yuan-To Revalue or Not to Revalue, That Is the Question
Chapter Notes
Chapter 11 The Strategy of International Business
Case Zara: Value Creation in the Global Apparel Industry
Introduction
Industry, Strategy, and Firm Performance
The Idea of Industry Structure
Industry Change
Strategy and Value
Creating Value
The Firm as a Value Chain
Using the Value Chain
Configuration
Does Geography Matter? Labor Costs and Location Decisions
Coordination
Value Chains and Change
Point-Counterpoint Value Chains: Real or Virtual?
Global Integration versus Local Responsiveness
Pressures for Global Integration
Globalization of Markets
Efficiency Gains of Standardization
Pressures for Local Responsiveness
Interaction
Strategy Types
International Strategy
Multidomestic Strategy
Global Strategy
Transnational Strategy
Looking to the Future New Strategy Types?
The Mix of Reality
Summary
Case The Globalization of eBay
Chapter Notes
Part V Global Strategy, Structure, and Implementation
Chapter 12 Country Evaluation and Selection
Case Carrefour
Introduction
Scanning and Detailed Examination Compared
What Information Is Important?
Opportunities
Risks
Does Geography Matter? Don't Fool with Mother Nature
Collect and Analyze Data
Problems with Research Results and Data
External Sources of Information
Internal Generation of Data
Point-Counterpoint Should Companies Forego Direct Investments in Violent Areas?
Country Comparison Tools
Grids
Matrices
Allocating Among Locations
Reinvestment versus Harvesting
Interdependence of Locations
Geographic Diversification versus Concentration
Noncomparative Decision Making
Making Final Country Selections
Looking to the Future Will the Prime Locations Change?
Summary
Case FDI in South Africa
Chapter Notes
Chapter 13 Export and Import Strategies
Case Grieve: A Small-Business Export Strategy
Introduction
Export Strategy
Strategic Advantages of Exports
Characteristics of Exporters
Stages of Export Development
Pitfalls of Exporting
Designing an Export Strategy
Import Strategy
Strategic Advantages of Imports
The Role of Customs Agencies
Import Documentation
Point-Counterpoint A Dirty Dilemma: Exporting Hazardous Waste
The Export Process
Indirect Selling
Export Management Companies
Export Trading Companies
Foreign Trading Companies
Direct Selling
Direct Selling Through the Internet
Export Documentation
Foreign Freight Forwarders
Looking to the Future The Technology of Trade
Sources of Assistance
Countertrade
Barter
Buybacks
Offset Trade
Summary
Case Sunset Flowers of New Zealand, Ltd.
Chapter Notes
Part V Global Strategy, Structure, and Implementation
Chapter 14 Direct Investment and Collaborative Strategies
Case Cisco Systems
Introduction
Why Exporting May Not Be Feasible
Cheaper to Produce Abroad
Transportation Costs
Lack of Domestic Capacity
Need to Alter Products and Services
Trade Restrictions
Country of Origin Effects
Noncollaborative Foreign Equity Arrangements
Foreign Direct Investment and Control
Methods for Making FDI
Motives for Collaborative Arrangements
General Motives for Collaborative Arrangements
International Motives for Collaborative Arrangements
Types of Collaborative Arrangements
Some Considerations in Collaborative Arrangements
Point-Counterpoint Should Countries Limit Foreign Control of Key Industries?
Licensing
Franchising
Management Contracts
Turnkey Operations
Joint Ventures
Equity Alliances
Problems of Collaborative Arrangements
Collaboration's Importance to Partners
Differing Objectives
Control Problems
Partners' Contributions and Appropriations
Differences in Culture
Managing Foreign Arrangements
Dynamics of Collaborative Arrangements
Finding Compatible Partners
Negotiating Process
Contractual Provisions
Performance Assessment
Looking to the Future Why Innovation Breeds Collaboration
Summary
Case International Airline Alliances
Chapter Notes
Chapter 15 The Organization of International Business
Case Johnson & Johnson
Introduction
The Causes of Change
Organization in the International Business
Organizational Structure
Vertical Differentiation: Centralization versus Decentralization
Horizontal Differentiation: The Design of the Formal Structure
Functional Structure
Divisional Structures
Matrix Structure
Mixed Structure
Contemporary Structures
Network Structure
Virtual Organization
Project Structure
Point-Counterpoint Hierarchies or Hyperarchies?
Coordination and Control Systems
Coordination Systems
Control Systems
Control Mechanisms
Organization Culture
The Growing Importance of Culture
Challenges and Pitfalls
Strategy and Organization Culture
Looking to the Future The Role and Rise of Corporate Universities
Organization in Special Situations
Acquisitions
Shared Ownership
Dynamic Nature of Performance
The Role of Legal Structures
Branch and Subsidiary Organizations
Types of Subsidiaries and Operating Form
Summary
Case GE Hungary
Chapter Notes
Part VI Managing International Operations
Chapter 16 Marketing Globally
Case Avon
Filling Global Needs and Wants
Marketing Strategies
Marketing Orientations
Targeting and Segmenting Markets
Product Policy
Reasons for Making Product Alterations
Point-Counterpoint Should First World Governments Regulate Their Companies'
Marketing in Third World Countries?
Alteration Costs
Extent and Mix of the Product Line
Product Life-Cycle Considerations
Pricing
Governmental Intervention
Greater Market Diversity
Price Escalation in Exporting
Currency Value and Price Changes
Fixed versus Variable Pricing
Company to Company Pricing
Promotion
The Push-Pull Mix
Standardization of Advertising Programs
Branding
Language Factors
Brand Acquisitions
Country-of-Origin Images
Generic and Near-Generic Names
Distribution
Does Geography Matter?
Difficulty of Standardization
Choosing Distributors and Channels
Hidden Costs in Distribution
The Internet and Electronic Commerce
Managing the Marketing Mix
Looking to the Future Will the "Haves" and the "Have-Nots" Meet the "Have
Somes"?
Summary
Case NeoPets
Chapter Notes
Chapter 17 Global Manufacturing and Supply Chain Management
Case Samsonite's Global Supply Chain
Introduction
Global Manufacturing Strategies
Manufacturing Compatibility
Manufacturing Configuration
Coordination and Control
Information Technology and Global Supply Chain Management
Quality
Total Quality Management
Quality Standards
Supplier Networks
Make or Buy Decision
Point-Counterpoint Should Firms Outsource Innovation?
Supplier Relations
The Purchasing Function
Inventory Management
Just-in-Time Systems
Foreign Trade Zones
Transportation Networks
Looking to the Future The Role of China in the Supply Chain
Summary
Case Denso Corporation and Global Supplier Relations
Chapter Notes
Chapter 18 International Accounting Issues
Case Parmalat-Europe's Enron
Introduction
Factors Influencing the Development of Accounting Worldwide
Accounting Objectives
Cultural Differences in Accounting
Classification of Accounting Systems
International Accounting Standards and Global Convergence
Looking to the Future Will IASB GAAP Become the Global Accounting Standard?
Transactions in Foreign Currencies
Recording of Transactions
Correct Procedures for U.S. Companies
Translation of Foreign Currency Financial Statements
Translation Methods
Disclosure of Foreign-Exchange Gains and Losses
Environmental Reports
Performance Evaluation and Control
Foreign Exchange in the Budget Process
Budgeting and Currency Practices
Point-Counterpoint Should Local Subsidiary Management Be Held Responsible for
Exchange Rate Changes?
Transfer Pricing and Performance Evaluation
The Balanced Scorecard
Summary
Case Vivendi Universal
Chapter Notes
Chapter 19 The Multinational Finance Function
Case Nu Skin Enterprises in Asia
Introduction
The Treasury and Finance Functions
Capital Structure
Offshore Financial Centers
Point-Counterpoint Offshore Financial Centers Should Be Shut Down
Capital Budgeting in a Global Context
Internal Sources of Funds
Global Cash Management
Multilateral Netting
Cash Flow Aspects of Imports and Exports
Foreign-Exchange Risk Management
Translation Exposure
Transaction Exposure
Economic Exposure
Exposure-Management Strategy
Taxation of Foreign Source Income
Foreign Branch
Foreign Subsidiary
Transfer Prices
Tax Credit
Non-U.S. Tax Practices
Value-Added Tax
Tax Treaties: The Elimination of Double Taxation
Looking to the Future Technology and Cash Flows
Summary
Case Dell Mercosur
Chapter Notes
Chapter 20 Human Resource Management
Case A Career in International Business
Introduction
The Strategic Function of International HRM
Staffing Policies
The Ethnocentric Approach
The Polycentric Approach
The Geocentric Approach
Summary
Expatriate Selection
Technical Competence
Adaptiveness
Leadership Ability
Expatriate Failure
Expatriate Preparation and Development
General Country Understanding
Cultural Sensitivity
Practical Skills
Training Gaps and Trends
Point-Counterpoint Learning a Foreign Language: Still Useful?
Expatriate Compensation
Types of Compensation Plans
Key Aspects of Expatriate Compensation
Complications Posed by Nationality Differences
Expatriate Repatriation
Managing Repatriation
International Labor Relations
Labor's Concerns About MNEs
Product and Resource Flows
Value Activity Switching
Scale and Complexity of MNEs
Labor's Actions Toward MNEs
Labor's Success and Struggle
Looking to the Future Which Countries Will Have the Jobs of the Future?
Trends in the Relationship Between MNEs and Labor
Summary
Case Tel-Comm-Tek (TCT)
Chapter Notes
Glossary
Photo Credits
Company Index and Trademark
Name Index
Subject Index