Incentives influence firms to use international strategies

 

What incentives influence firms to use international strategies? What are the three basic benefits firms can gain by successfully implementing an international strategy? Why?
Determine why, given the advantages of international diversification, some firms choose not to expand internationally. Provide specific examples to support your response.
As firms attempt to internationalize, they may be tempted to locate their facilities where business regulation laws are lax. Discuss the advantages and potential risks of such an approach, using specific examples to support your response.

Sample Solution

Incentives influence firms to use international strategies

Incentives are any additional benefits for the party in question in return for or an additional effort. Incentives that affect companies to use international strategies have a wide range starting from the ability to get access to a wider market or to use ingenious technology. Using international strategies for the firm is of paramount importance as they not only have an established domestic market but also a market in the international arena. There are three basic benefits to a company using an international strategy. These benefits are: large market access; economies of scale with additional learning opportunities; strategic and lower cost location advantages such as labor and energy.

apan’s political journey from its quasi-democratic government in the 1920’s to its radical nationalism of the mid 1930’s, the collapse of democratic institutions, and the eventual military state was not an overnight transformation. There was no coup d’etat, no march on Rome, no storming of the Bastille. Instead, it was a political journey that allowed a semi-democratic nation to transform itself into a military dictatorship. The forces that aided in this transformation were the failed promises of the Meiji Restoration that were represented in the stagnation of the Japanese economy, the perceived capitulation of the Japanese parliamentary leaders to the western powers, a compliant public, and an independent military.

The ground work for Japanese militarism was a compliant Japanese public. This pliant public was created through a variety of factors. Beginning in the 1890’s the public education system indoctrinated students in the ideas of nationalism, loyalty to the emperor and traditionalist ideas of self-sacrifice and obedience. Thus ideas that were originally propagated to mobilize support for the Meiji government were easily diverted to form broad support for foreign militarism. Japanese society also still held many of the remnants of feudal culture such as strong confusion beliefs that stressed support for social order and lack of emphasis on individualist values. These values taught obedience not to a democratic but to the emperor; so the fact that the militaristic government of the 1930’s ruled under the emperor meant that the Japanese were loyal to this government just as they had been to the government of the 1920’s. So when Japan’s militaristic government implemented programs characteristic of totalitarian governments such as strong media control, a thought police, and community organizations the public did little to protest. Shintoism provided a religious justification for nationalism and support for the militaristic government. Shintoism before the 1930’s was primarily a nativistic religion which stressed nature and harmony. B

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