Key International Institutions That Impact International Businesses
Institutions are firms made by a group of people with an aim of improving the living standards of people. It can also be said to be a collection of individuals with varying needs and ideas and making them unique with one objective, as well as regulating their behaviors. Two types of institutions exist, formal and informal institutions. Formal institutions are governed by rules and regulation while the informal institution is governed by values and norms to shape their behaviors. Some international institutions and their impact on business ate discussed hereby.International monetary institutions: The objective of this institution is to lend money to the various institutions across the world, to promote the business.
This institution is well known for the emergence of International Monetary Fund (IMF) and World Bank. The IMF has 186 members who contribute money, quotas, which are used to lend to other nations for international trade, making a positive impact on the international businesses. World Bank offers loan at low interest especially to non-developed countries to help them grow and develop. United Nation (UN) Organization: UN is responsible for maintaining peace as well as security internationally. It has a positive impact in that it ensures that peace prevails to pave ways for international businesses and trade. Also, UN develops multilateral solutions to make international businesses possible. UN also focuses on areas dependent on development such as health and education, making it appropriate for development.
World Trade Organization (WTO): WTO enforces business deals between nations. It also eliminates any possible barrier that may appear between sellers, buyers, and suppliers from different nations, thereby allowing business people to intermingle freely for businesses, making it a positive impact to the international businesses. Economic Integration Agreements: Distinguished by giving business people a place where they can trade freely. Economic integration agreement has a positive impact to the international business. It focuses on a common market where it dictates where people are supposed to trade, and with which nations among other nations.What are the primary sociological forces that impact international businesses, and what are their specific impacts on those businesses?
Some of the primary sociological forces that impact international businesses include; Cultural differences: This is where people are unable to understand foreign markets, and therefore, they fail to understand the needs of the market, thereby making a negative impact to the international businesses. The result is a poor introduction of a product in a foreign market, poor advertisement, as well as poor pricing that leads to the product being rejected in specific markets. Cultural differences also include varying attitude that affects business negatively.
Individualism-collectivism: This is an elaboration of how people should work as groups in various nations. However, people opt to work individually over in a group. The result is poor decision making as well as the lack of lack of employee motivation that leads to business fall up, not only in the home country, but also …