Globalization of Markets

ECON 401 Assignment 1, version B- Globalization of markets: Moving away from an economic system in which national markets are distinct and entities, isolated by trade barriers and barriers of distance, time and culture, and towards a system in which national markets are emerging into one global market.

Example: McDonalds having to adapt their menus to people changing preferences. In order to stay competitive, McDonalds had to adapt a healthier menu. Also McDonalds realized that their customers want a place where they are able to have a meeting, a place to “hangout”, therefore lots of McDonalds in Grande Prairie renovated their restaurant and changed the way their menu is designed to make it more appealing, and healthier, for the consumer. They also offer free Wi-Fi for their customers who want to do their business while they are enjoying their meals.

Globalization of Production: tend by individual firms to disperse parts of their productive processes to different locations around the globe to take advantage of differences in costs and quality of factors of production.

Example: Nike decided to move where the production was made for their product to china to save on costs of labour to create a higher profit margin. By doing this they were able to increase their revenues and also the labour laws in those countries are not the same as North America, therefore they are able to create more product in a less amount of time because breaks might not be required in a country, like China. Whereas, they would be in North America.

1. The Venezuelan economy teaches us that when a dictator is in control, it can be really bad for the country. With a dictator like Chavez in control of political decisions, not every decision made will benefit the country. For example, “in 2009, when Chavez also extended governmental control over the media and making them only partly free” (p.50 International business, Hill 2010). One of the good things that happened under Chavez’s...