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Global Trade Environment (Competition among business organisations…
Global Trade Environment
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Competition & Trade
Absolute Comparative Advantage (Smith, 1776) If a country can supply goods a ta cheaper price than others, better to buy it from them than make it.
Relative Comparative Advantage (David Ricardo) A country will generally specialise in the production of goods in which it has a comparative advantage
The diamond Model (Porter, 1990)
Four Factors:
Factor Conditions (i.e. Natural resources)
The demand conditions (in the country for that specific industry)
Strategies, Structure & Rivalry (firms within the industry)
Quality of Related & Supporting Industries (and infrastructures)
Can be heavily influenced by the government: Distributing Subsidies / tax conditions / educational policies
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