Negocios internacionales- economia politica

Armando Vernet
International Business Management
Teresa Freitas dos Santos
August 21, 2012
Universidad Iberoamericana

Reading Report of Chapter 2 (Outline) / News

National Differences inPolitical Economy

Chapter two in the book is an overview of how differently the political, economic, and legal systems work in each country. There are several things that change and are changingvariables in countries that can benefit or negatively affect your business in some countries. The book presents us with different types of governments and their economies and legal systems.

Thepolitical structure refers to the type of government a country rules under. There are three different forms of government around the world. They are the following ones:
1. Democracy
a. It isindividualist
b. It has a market economy
c. Property rights

2. Totalitarian
d. Socialist/Communist
e. Collectivism
f. It has a command economy
g. Governmentowns everything
i. They tell the producers what, when, and how to produce
ii. They tell them at what price they have to sell

3. Theocracy
h. Influenced by religioni. The political leader is also a religious leader

Then the book presents us with the tree types of economic systems a government can choose to practice.

1. Market Economy
a.Prices are free of control
b. Characterized to be individualistic, usually in a democracy
c. All means of production are privately owned
d. The production is determined by supply anddemand

2. Command Economy
e. The government plans the goods and services that its country produces
f. The prices are set by central planners
g. Productive assets are owned bythe state
h. Private ownership is not allowed
3. Mixed Economy
i. A mixed economy is a combination of both the command economy and the market economy

In reality there is no...