University of Washington
GEOG  349:  Geography of International Trade
Autumn 2009

REVIEW  QUESTIONS  FOR  SECOND  TEST


Refer to the instructor's objectives for the course.  For each objective:
Identify one objective on which you'd like to work after the course is over.  How might you go about that?


Though this section of the course is not as theoretically oriented as the first section of the course, the overarching framework is that of making organizational decisions that will maximize returns to key organizational assets, and that will strengthen those assets.  These are the essential goals of corporate strategy, business (or competitive) strategy, and functional strategies.  These are also important to determining the appropriate form of international business:  you have to know what your core asset is before you can determine whether licensing or contracting production are reasonable alternatives to exporting or FDI.  (Of course, regulations and barriers you face from your home country or a host country will play a role in this decision, as well).  Finally, identifying unique assets is the first step in applying the OLI (or "eclectic") model to decisions whether to engage in FDI.


Identification of an organization's unique or key assets is an important part in determining the location and organization of procurement and production.  Organizations generally want to own operations that are part of their core assets, but may contract other operations -- sometimes within a stable network of providers, sometimes by selecting the best deal in the open market.  International differences in trade barriers and feasibility of FDI will also affect these decisions, and affect the decisions where to engage in what sorts of operations.  Use the examples in this moderately complex table to help you understand some of these contingencies.


International marketing is an important example of a functional strategy in the international arena.  International financial management and international human resource management are also important.  What are the six components of an international marketing plan?  I've emphasized that the decisions for each component must support the decisions for all the other components, and must be a function of the roles that international marketing play in the organization's overall business strategy -- which is based in part on the nature of the organization's strategic assets (a.k.a. organization-specific advantage).  Be able to play with these components:  if I provide a basic scenario (sector, size of organization, and its key assets or advantages), you should be able to create a quick-and-dirty marketing plan in which all the elements work together.  [Important though minor point:  "marketing" is a heck of a lot more than "advertising"!]

What are key considerations in managing a company's human resources internationally?


Assets are what an organization "owns" or at least invests in and manages (like key employees).  Environment is what an organization can't control -- except by choosing in what environments it operates.  What are key dimensions of the cultural and economic, political, and legal environments of countries?  Be able to describe (very quickly and not in much detail)

Learn the simple definitions for key terms of currency exchange.  Why should a firm or other organization, which operates almost entirely in one country, hedge its exposure to foreign exchange risk?  How can an exporter avoid exchange risk, given the choices in international payments?


Be able to define key export documents.  What are the key variables and choices in payment for exports?  Which are more advantageous for the exporter?  What determines which choices are made in a given export arrangement?


Use your knowledge of (a) the influences of currency fluctuations on international trade and investment to project (b) what impacts a substantial fall in the value of the US dollar would have on different regions of the US, or on different regions of the country you focused on this quarter.


From the readings for RP5:


copyright James W. Harrington, Jr.
revised 3 December 2009