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International Business

notes more open countries, long ago gave up illusion of domestic policy autonomy. But even the largest
and most apparently self-contained economies, including the US, are now significantly affected
by the global economy. Global integration in trade, investment, and factor flows, technology, and
communication has been tying economies together.
Why then are these changes coming about, and what exactly are they? It is in practice, easier to
identify the former than interpret the latter. The reason is that during the past few decades, the
emergence of corporate empires in the world economy, based on the contemporary scientific and
technological developments, has led to globalization of production. As a result of international
production, co-operation among global productive units, the large-scale capital exports, “the
export of production” or “production abroad” has come into prominence as against commodity
export in world economy in recent years. Global corporations consider the whole of the world
their production place, as well as their market and move factors of production to wherever they
can optimally be combined. They avail fully of the revolution that has brought about instant
worldwide communication, and near instant-transformation. Their ownership is transnational;
their management is transnational. Their freely mobile management, technology and capital, the
modern agent for stepped-up economic growth, transcend individual national boundaries. They
are domestic in every place, foreign in none-a true corporate citizen of the world. The greater
interdependence among nations has already reduced economic insularity of the peoples of the
world, as well as their social and political insularity.
International business includes any type of business activity that crosses national borders. Though
a number of definitions in the business literature can be found but no simple or universally
accepted definition exists for the term international business. At one end of the definitional
spectrum, international business is defined as organization that buys and/or sells goods and
services across two or more national boundaries, even if management is located in a single
country. At the other end of the spectrum, international business is equated only with those
big enterprises, which have operating units outside their own country. In the middle are
institutional arrangements that provide for some managerial direction of economic activity taking
place abroad but stop short of controlling ownership of the business carrying on the activity.

Example: Joint ventures with locally owned business or with foreign governments.
In its traditional form of international trade and finance as well as its newest form of
multinational business operations, international business has become massive in scale
and has come to exercise a major influence over political, economic and social from many
types of comparative business studies and from knowledge of many aspects of foreign business
operations. In fact, sometimes the foreign operations and the comparative business are used as
synonymous for international business. Foreign business refers to domestic operations within a
foreign country. Comparative business focuses on similarities and differences among countries
and business systems for focuses on similarities and differences among countries and business
operations and comparative business as fields of enquiry do not have as their major point of
interest the special problems that arise when business activities cross national boundaries.

Example: The vital question of potential conflicts between the nation-state and the
multinational firm, which receives major attention is international business, is not like to be
centered or even peripheral in foreign operations and comparative business.

1.1 evolution of international Business

The business across the borders of the countries had been carried on since times immemorial.
But, the business had been limited to the international trade until the recent past. The post-World
War II period witnessed an unexpected expansion of national companies into international
or multinational companies. The post 1990’s period has given greater fillip to international
business.

2 lovely Professional university