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  1. 1. CHAPTER 3 History and Geography:The Foundations of Culture
  2. 2. History of nations• Pakistan• Bangladesh• Russia• Iraq• Afghanistan• Sikkim• Nepal
  3. 3. Historical Perspective in Global BusinessHistorical insights of a country are important for understanding: Attitudes about the role of government and business Relations between Managers and Subordinates Sources of Management Authority Attitudes toward Foreign Corporations
  4. 4. History and Contemporary Behavior Historical events between nations influence business and history Why do the Japanese have such strong loyalty toward their companies? Why is a distribution system so difficult for an outsider to develop? Why are decisions made by consensus?
  5. 5. History and Cont. Behavior Cont. Why are the Japanese loyal to family, to country, to company, and to social group? Why do the Japanese cooperate? Answers found in Japanese history and Confucian philosophy: Jen: love, benevolent, concerns for one’s fellow men; and Li: describes a combination of manners, rituals, customs, etiquettes
  6. 6. History is subjective Manifest Destiny:Meant that American were chosen people to create a model society. It was used to justify US annexation of Texas, Oregon, New Mexico and California and later US involvement in Cuba, Alaska, Hawaii and Philippines
  7. 7. History is subjectiveThe Monroe DoctrineIs a cornerstone of US foreign policy; was enunciated by President James Monroe1. No further European colonization in the New World2. Abstention of the US from European political affair3. Nonintervention of European governments in governments of the Western Hemisphere
  8. 8. US Intervention in Latin America• USA attempts to thwart election of Peron in 1946• Popular revolution neutralized by US economic pressure• CIA organized invasion overthrows Arbenz (1954)• Nationalist revolution (1959) and alliance with USSR (1960)
  9. 9. US Intervention in Latin America• Covert intervention by USA against elected Marxist government of Popular Unity (1970-73)• Military intervention by USA against elected Marxist government of popular unity• Evolution (1979)USA funds counter revolutionary movement (1980s)• Covert intervention by USA to defeat left wing guerrillas (1980 – 88)
  10. 10. US Intervention in Latin America• US invasion to restore stable government (1983)• US invasion to arrest President Noriega on charge of drug trafficking (1989)• Negotiated US invasion to restore democracy (1994)• North American Free Trade Agreement (NAFTA: !994)
  11. 11. Geography and Global Markets Study of geography is important in the evaluation of markets Need to be knowledgeable about the effects of geographic diversity on the economic profiles of various nations Climate and topography are examined as facets of the broader and more important elements of geography
  12. 12. Climate and Topography Knowledge about geography, the climate and physical terrain when appraising a market Influences marketing from product adaptation to more profound influences on the development of marketing systems Climatic features affect uses and functions of products and equipment
  13. 13. Social Responsibility & Environmental Management Firms required to be socially responsible especially in foreign markets Firms should comply regulations against environmental pollution and disposal of hazardous waste Economic development and protection for the environment can coexist Sustainable development guides many governments and multinational companies today
  14. 14. Sustainable Development: Key Propositions There is a crucial and potentially positive link between economic development and the environment The costs of inappropriate economic policies on the environment are very high Addressing environmental problems requires that poverty be reduced
  15. 15. Sustainable Development Cont. Economic growth must be guided by prices that incorporate environmental values Since environment problems pay no respect to borders, global and regional collaboration is sometimes needed to complement national and regional regions
  16. 16. Natural Resources Importance of natural resources especially to manufacturing of products Supply of natural resources not endless Human labor provides the preponderance of energy in many countries Importance of oil and gas in world energy consumption
  17. 17. Global Population TrendsPeople constitute markets for various categories of goods. Necessary to know about:(1) rural/urban population shifts(2) rates of growth(3) age levels, and(4) population control(5) rural-urban migration of world population(6) population decline and aging(7) worker shortage and immigration
  18. 18. World Trade Routes and Communication Links Knowledge about trade routes over land, sea, and air important in making marketing decisions The majority of world trade is among the most industrialized and industrializing countries of Europe, North America, and Asia Need to be aware about communication links— the underpinning of all commerce Impact of the Internet revolution especially for global marketing of products