Apply ONE topic from this week's chapter to this article and explain how it relates. Be original. Assess and critique your peers work as well. Generously cite the text in your posts.
(Globalization) how does globalization relates.
ANOTHER PARAGRAPH ON WHAT YOU THINK OF THIS PERSON RESPONSE:
One topic that applies to this article is the Evidence on Factor Proportions Theory: The Leontief Paradox, the predicting of trade wars has been based more on what is perpetually happening and less on research it is implicated that this or that will happen. However there is definite proof that trade wars can break out at any moment. “This apparent paradox between the predictions using the theory and the actual trade flows is called the Leontief paradox. Leontief’s findings are supported by more recent research on the trade data of a large number of countries”(Wild & Wild 152). The article mention wars amongst China and US, this would be detrimental to retails giants like Walmart and Apple. Trade wars can and would heavily impact our society as a nation we depend on manufactures that are not US based. “One possible explanation is that factor proportions theory considers a country’s production factors to be homogeneous—particularly labor. But we know that labor skills vary greatly within a country—more highly skilled workers emerge from training and development program (Wild & Wild 152). It is time for the US to begin bringing back factories and creating more labor this would minimize the effect of trade wars.
Wild, John J. and Kenneth L. Wild.
International Business: The Challenges of Globalization.6
thEdition. Pearson: Prentice Hall. NJ. 2012. eBook Web. 9 May 2013.
ANOTHER PARAGRAPH ON THIS PERSON RESPONSE:
Over recent years, due to the financial crisis that has led to economic downturn, international FDI has been decreasing across the globe, forcing governments/nations to seek out and highly compete for FDI in order to gain resources and benefits. We understand that governments “often intervene in the flow of FDI to protect their cultural heritages, domestic companies, and jobs. They can enact laws, create regulations, or construct administrative hurdles that companies from other nations must overcome if they want to invest in the nation” (Wild & Wild 197). As governments/nations are increasing their attempts and force to bring in investments and thwart other governments/nations, it creates tensions between and thus can lead to competing nations to enact laws and regulations, resulting and engaging in a trade-war. While nations have fair reasons to intervene in FDI; gain technology, management skill, and employment to name a few, multinational supply chains are highly opposed to protectionism, and that according to Lynn, government intervention may end up shutting down a main industry due to interrupting the supply chain by shutting out your neighbor. Currently, The WTO dispute system serves as a means for governments and nations to resolve differences in FDI by consultation or litigation in order to thwart protectionism. China who is often a site for litigation, uses the system actively and at the time of the article, the U.S. had proposed changes to zeroing to comply with WTO rulings. However, even with the WTO in place, according to the “World Economic Forum identifies that weak global governance as one of the main threats to the world today” (Lynn). As political leaders have the majority control and only their country's interests at heart, citizens of home/host nations as well as those throughout the world suffer.