ATHENA MIDTERM GEEL

Question 1

optimal dispersion

Answer 1

the best way to put your production facilities around the world

Question 2

globalization of markets

Answer 2

one big company –> reduced cultural differences

Question 2

globalization of products

Answer 2

taking advantage of national differences –> but more economical

Question 3

.. nations may account for more than 60% of world economic activity by 2030

Answer 3

developing nations

Question 4

Disadvantages to operating in a foreign market due to:
1. Spatial distance
2. Unfamiliarity
3. A lack of legitimacy
4. Home-country restrictions

Answer 4

spatial distance: increases travel, transpiration and coordination costs
unfamiliarty: with host country, extra cost to lean
lack of legitimacy: locals may not trust you
home country restrictions: Your home country might limit what you can do in the foreign country, making things harder.

Question 5

Theocratic totalitarianism

Answer 5

political power is monopolized by a party, group, or individual that governs according to religious principles

Question 5

Right-wing totalitarianism

Answer 5

economic freedom but restricts individual political freedom.

Question 6

Contract Law

Answer 6

Contracts define the conditions under which an exchange occurs and outline the rights and obligations of the involved parties

Question 7

common law contracts

Answer 7

like in the US: very detailed and long

Question 8

civil law contracts

Answer 8

like in France, contracts are shorter and more general

Question 9

Product Liability

Answer 9

Firms can be held responsible if their products cause injury or damage

Question 10

Product Safety Laws

Answer 10

Set standards to ensure products are safe for use.

Question 11

Property rights

Answer 11

legal rights over the use to which a resource is put and over the use of any income derived from that source

Question 12

violation in property rights in two ways

Answer 12

private action: theft, privacy, blackmail, by private individuals or groups

public action: when public officials extort income, resources or the property itself dorm the property holders

Question 13

institutions help stability and predictability but there are 2 different views on how they can be structured: norths view and Scotts view

Answer 13

norths view:
- reduce uncertainty and let people plan and make decisions more effectively
formal rules: constitutions and laws
informal constraints: cultural norms, taboos, social expectations

Scotts view:
- three pillars that provide stability and meaning to social life
regulative: focus on laws/regulations that control behavior
normative: obligations and social expectations (be kind to others)
cognitive: about certain behaviors that are taboo or inconveivable

Question 14

country attractiveness based on

Answer 14

benefits
risk
costs

Question 15

Cross Cultural Literacy

Answer 15

an understanding of how cultural differences across and within nations can affect the way business is performed

Question 16

values

Answer 16

• emotional significance, cannot be written down

Question 17

If the group is focused on individualism

Answer 17

entrenpreneurhsip, innovation but potential loneliness

Question 18

if the group is focused on groups

Answer 18

loyalty, mainly in non western societies, less innovation and entrepreneurship

Question 19

social strata

Answer 19

1. Trait of society(!), not reflection of individual differences
    2. Passes from generation to generation
    3. Generally universal but variable
    4. Not just inequality but also beliefs

Question 19

Ethical Systems

Answer 19

moral principles/values, guide behavior

Question 20

masculinity vs femininity

Answer 20

feminine culture: gender roles are less distinguished (more equality)

Question 21

critique hofstede

Answer 21

• culturally bound
• 1 mne, 1 industry
• too broad
• failting to capture the malleability of culture over time
• ignoring within-country heterogeneity