Lastly, companies can source cheaper and/or better raw materials from import making them more sustainable and profitable. More choices & competitive price: Monopolies or oligopolies are reduced in certain industries because international trade encourages greater competition which leads to more competitive prices. Consumers not only have the access to the new products or services that are not available in their country but also they get bigger bang for the buck ("The benefits of international Trade,” n.d.). Some negative aspects of international trade:
Liberals uphold the idea of free market or free trade and are of the conviction that if individuals can freely engage in production, exchange and consumption it will result in a mutual benefit for all and argues that the market lies at the center of economic life. They see transnational corporations (TNC’s) as a positive force and believes that TNC’s bring advantages to both home and host countries as it represents an optimal mix of technology, managerial skills and capital. Although the market relations are not always optimal, they tend to argue that intervention in the market is most likely to produce suboptimal outcomes (O’Brien & Williams, 2016). As stated by Adam Smith (1964) in his book “The Wealth of Nations” the wealth of a nation will better be served by policies of free trade. Thus, the nature of the international economic relations is harmonious and the well-being of the world economy could only be achieved through the adoption of liberal policies in which the international economic relations is a positive-sum game.
The competition is beneficial for customers because it provides them with a better quality product at a competitive price. While FDI brings many advantages for the host country and foreign company, both parties should also consider several disadvantages of
Competition delivers better outcomes than monopolistic ones and even in the cases where the competition policy provides some monopolistic rights at the same time it provides safeguards to ensure that those rights will not be used abusively. The UK Government it its White Paper Productivity and Enterprise: A world Class Competition Regime stated that “Vigorous competition between firms is the lifeblood of strong and effective markets. Competition helps consumers get a good deal. It encourages firms to innovate by reducing slack, putting downward pressure on costs and providing incentives for the efficient organization of production”
Chapter Summaries: The Ultimate Question 2.0: How Net Promoter Companies Thrive in a Customer-Driven World by Ahmed ElAwadly Preface: The book is surrounded by the Ultimate Golden Rule: treating others as you would like to be treated. To follow this golden rule and over-achieve in a customer driven field through profitable ad successful customer relationships. This is a book is guided path of how to truly grow one’s business through sustainable good profits which is derived from consistently delivering a customer experience worthy of their loyalty. Introduction: The management approach in conjunction with the net prompter system is a successful way to achieve good profits, ethical profits from enhancing the lives of the customers instead of using the old version of a bad habit by exploiting your customers. The main objective is to have full use of ‘word of mouth’ to enhance your business.
So all three are significant for the purchase and purchase intentions. Aaker and Jacobson, (1994) concluded that towering level of brand loyalty considerably augment sales of a brand as well as increase the economic value of the brand. Loyal buyers are not as much of have an effect on them by price rivalry. Superior sales are to boost product productivity, calculating nix uneven boost in expenses. Moreover loyalty is also important due the fact that the price to catch the attention of a new customer considerably.
With this, there are absolute gains and all member states benefit and there is also development for underdeveloped countries. Technical assistance also fosters absolute gains because with trade liberalisation and lowering tariffs, more persons are willing to trade and foreign investment is created. This is beneficial because of foreign revenue, boosting economic growth and creating employment. This fosters cooperation and interaction among member states. With trade liberalisation, there is interdependence because other states are dependent on the more developed ones.
And as the evolved theory of liberalism, theoretically neo-liberalism is essentially about making trade between nations easier than it used to be in the old times. Neo-liberalism focuses about freer movement of goods, resources and enterprises in a bid to always find cheaper resources, to maximize profits and efficiency. Aside from free trade, that is the product of traditional liberalism, multinational corporations and institutions are the products of neo-liberalism that developed in modern days. However, many experts argue that neo-liberalism is mercantilism that only covered with more friendly approaches. In theory, neo-liberalism might appears as populism; a perspective that took side with people and uphold economic equality, but in practice, for example in developing countries, many people that live with average standard of living, should temporary leave their way of life to work as a peasant of capitalism system that created by neo-liberalism.
Globalisationhas also reduced trade batrriers and has allowed free flow of gOods, services and labour from one place to another which has allowed countries to specialize in production of goods whichas a result has increased the productivity of firms in countries and minimised thier costs as well.Globaliosation also allows countriesto obtain goods at cheaper prices which could prove to expensive to produce in thier own country.This process also enhances competition between countries through easierflow of goods and services between countires whichis an effective way of enhancing innovation to produce better quality goods. the rise in globalisation has increased capital flow into developing countries. Foriegn direct investment into developing countries stabalises the countrie 's ecomomic situation. However thier will be net capital outflow that couldlead to negative effects on trade. Large capital inflows into countries could be caused by appreciation in exchange erates and inflATIONARY PRESSURE that impacton country 's current acount.
First is that there is free trade in the trading bloc. As members have the advantage of importing and exporting freely to each other’s market then they think of their own benefits. Even though they can produce some of the goods efficiently but other countries are able to produce it more efficiently from them hence it encourages them to use the theory of comparative advantage and benefit from it. Next advantage is that, as members can access each other’s market freely so the trade between them will tend to increase. So there is trade creation because of trading bloc and this helps in trading goods at lower prices than the price which is charged by domestic producers which is generally high.