Competitive Advantages And International Trade - 1636 Words

Mirza Beg 5/11/15 Professor Shahrouri Econ 335 Competitive Advantages and International Trade Globalization has made it far easier for people to get their hands on the luxury items they desire so much, but we hardly contemplate the origins of many of the luxuries we take for granted in the U.S. With a debt fast approaching the new imaginary ceiling of 16.394 Trillion dollars, the U.S. owes a lot of money. Much of this is to do with waging illegal wars in the Middle East and spending money creating an empire, but there are other factors that contribute to this as well. The fact is we love to shop as a society, even when we cannot afford the items we are searching for. The relative ease of buying products with credit has created a culture of consumerism that is unprecedented in modern history. Due to the outsourcing taking place by U.S. corporations, most of the products are being made overseas and this has creates a trade deficit. Our government allows American companies to turn their backs on our own workers in order to milk out a little extra profit by importing goods. At one point Detroit was the number one manufacturing city in the entire world, now it is a bankrupt city suffering from the flawed policies that allowed for its demise. Being the fairly wealthy population that we are, there is a high demand for the same luxury goods regardless of where they are made. Specialization of many kinds has emerged in order fill the demands for products from around the world,Show MoreRelatedInternational Trade : A Competitive Advantage1261 Words   |  6 Pages C lassical theories of international trade suggest that comparative advantage exist in the factor endowments that a country may be fortunate enough to inherit. Factor endowments include land, natural resources, labor, and the size of the local population. Michael E. Porter claimed that a nation can create new advanced factor endowments such as skilled labor, a strong technology and knowledge base, government support, and culture. Porter used a diamond shaped diagram as the basis of a framework toRead MoreInternational Trade : Comparative And Competitive Advantage1512 Words   |  7 Pages International trade theories are simply theories that explain how imports and exports work between different countries. Hence the name international trade. In this paper I will be reviewing different theories of international trade, explain the difference between comparative and competitive advantages, and answering three important questions. What the underlying economic rationale for international business activity is, why trade takes place, and the gains from trade and investment. I will firstRead MoreAdvantages Of International Trade For Developing Nations1313 Words   |  6 PagesAdvantages of international trade for developing nations Although the concept of free trade and globalisation may subtly imply a polarity between the developed and developing worlds, it can be argued that, in order to function successfully, the pressure to create a competitive and comparative advantage hold all nations on a level-playing field. Sinclair Davidson (2015) cited David Ricardo (1821) in his argument that foreign trade is, indeed, beneficial to a country, for a number of reasons. By reducingRead MorePorters Theory of National Competitive Advantage1717 Words   |  7 PagesIntroduction Porters theory of national competitive advantage expands on basic international trade theory, which posits that nations can leverage certain advantages that they inherit to create advantage for themselves on international markets. What Porter contends is that there are advanced factor endowments that nations can cultivate in order to give them competitive advantages in international trade. These advanced factor endowments are firm strategy, struct ure and rivalry; factor conditions;Read MoreInternational Trade And The Global Marketplace1428 Words   |  6 Pagescountries are engaged to international trade in order to achieve economic growth, free trade agreement and financial liberalization has contributed to the opening up of world economies and resulted in more international trade. Countries use their comparative advantages to gain a positon in the global marketplace and achieve economic growth (Seyoum 2007). International trade is a critical resource of revenue earning for developing countries. However, the benefits realized from free trade are mostly enjoyedRead MoreImpact Of Globalization On International Business828 Words   |  4 Pagesprocess of international business. Many of the items we are using at this very moment are imports, products produced in another country. Many businesses today rely on exports, products produced in their home country and shipped to other nations. Every country relies on imports and expo rts. Wether a firm is expanding to another nation or uses imported goods, international business is always involved and will affect the business model. Factors that will affect and alter the international marketplaceRead MoreIn Certain Cases Porters Diamond of Competitive Advantage May Not Be an Appropriate Framework for the Analysis of a Nations Sources of Competitive Advantage.1621 Words   |  7 PagesSince its publication in 1990, Michael Porters book The Competitive Advantage of Nations has attracted much consideration. The main analytical tool of the book is the diamond of competitive advantage (figure 1). This model is based on four country specific determinants and two external variables. Porters four determinants and two outside forces interact in a diamond of competitive advantage, with the nature of a countrys international competitiveness depending upon the type and quality of theseRead MoreFree Trade Improves The Quality Of Life For A Nation And Its Citizens1448 Words   |  6 PagesFree trade improves the quality of life for a nation and its citizens. It can import goods that they may not able to produced. Also, importing goods may be cheaper for a developing country than attempting to produce it. Child labor in developing countries has also be the main problem in the lacking of technology. Children are used as a cheap substitute for manufacturing equipment. International trade would allow countries across the border to invest equipment and pay higher wages to adult workersRead MoreWhy Do Business Internationalise?. International Trade1181 Words   |  5 PagesWhy do business internationalise? International trade can be traced back to ancient years. Our ancestors, with the purpose of increasing the variety of local products, had been trying their best for decades to trade cross border. With the development of international business, international trade theories was developed to explain the benefit nations can get from utilizing free trade pattern and participating in the multilateral trade via opening up strategy by eliminating import control, exportRead MoreQuestions On International Trade Theory1332 Words   |  6 Pagesnumber: 201109990 Module name: International business Module code: MKIB 225 Essay question: Why do businesses internationalize? Compare and contrast the various â€Å"standard† theories . Word count: 1051 Why does business internationalize? With the development of international business, countries with the purpose of increasing the variety of local products had been trying best for decades to trade with other nations. Furthermore, international trade theories were developed to explain