INTL Business Midterm - CH 3 & 4 & 5 REVIEW

Gross Domestic Product (GDP)

A measurement of the total goods and services produced within a country.

Purchasing Power Parity

An adjustment in gross domestic product per capita to reflect differences in the cost of living

six determinants of ethical behavior

Personal ethics Decision making processes Organizational culture Unrealistic performance goals Leadership Societal culture

unrealistic performance goals

Pressure from parent company to meet goals that are unrealistic and can only be attained by acting in an unethical manner

social structure

a pattern of organized relationships among groups of people within a society

World Values Survey (WVS)

a research project spanning more than 100 countries that explores people's values and norms, how they change over time, and what impact they have in society and business

social stratification

a system by which a society ranks categories of people in a hierarchy

Culture

a system of values and norms that are shared among a group of people and that when taken together constitute a design for living

Societal Culture

firms headquartered in cultures where individualism and uncertainty avoidance are strong are more likely to stress ethical behavior than firms headquartered in cultures where masculinity and power distance rank high

Entrepreneur

first to commercialize innovative products and processes

development requires removing major impediments to freedom:

poverty, tyranny, poor economic opportunities, systematic social deprivation, neglect of public facilities

Hofstede's Cultural Dimensions

power distance, individualism/collectivism, masculinity/femininity, uncertainty avoidance, short-/long-term orientation

Determinants of Culture

religion, political philosophy, economic philosophy, education, language, social structure

Deregulation

removing legal restrictions to the free play of markets, the establishment of private enterprises, and the manner in which private enterprises operate

Norms

social rules and guidelines that prescribe appropriate behavior in particular situations

legal systems

system of rules that regulate behavior and the processes by which the laws of a country are enforced and through which redress of grievances is obtained

human rights

the basic rights to which all people are entitled as human beings

Personal Ethics

the generally accepted principles of right and wrong governing the conduct of individuals

organizational culture

the set of values, ideas, attitudes, and norms of behavior that is learned and shared among the members of an organization

Privitization

transfers the ownership of state property into the hands of private investors

cross-cultural literacy

understanding of how cultural differences across and within nations can affect the way business is practiced

the shift toward a market-based system involves:

- Deregulation - Privatization - A legal system to safeguard property rights

Trends that foster greater economic development

-democratic forms of government -market based economic reforms -legal systems that better enforce property rights

Decision Making Process

The process of choosing between two or more alternatives or options; most logical way to make a decision.

society

a group of people sharing a common set of values and norms

market economy

economic system in which decisions on production and consumption of goods and services are based on voluntary exchange in markets

planned economy

economy that relies on a centralized government to control all or most factors of production and to make all or most production and allocation decisions

The most common ethical issues in business involve:

employment practices human rights environmental regulations corruption moral obligations

Examples of human rights

freedom of association freedom of speech freedom of assembly freedom of movement freedom from political repression

Leadership

helps to establish the culture of an organization and set the examples that others follow

Values

ideas about what is right or wrong, good or bad, desirable or worthy in a particular group

Human Development Index (HDI)

measures the quality of human life in different nations - life expectancy, educational attainment, average income

innovation

new products along with new processes, new organizations, new management practices, and new strategies