Economy + Culture = Politics
-Whenever there are assets controlled by a group of people, an authority is established to manage the assets and people. That negotiation of assets and people through a system of rules is considered politics. The politics also involve relationships to other countries.
Nation state authority & international business
-Political bodies or “nation states” create regulations that facilitate and limit businesses. International business requires knowing the authority system of the home country, as well as others. International business means understanding the laws and costs of multiple countries.
-Nation states have authority over businesses by law, in part because businesses use thegovernment's currency and also because they must pay taxes. Nation states also controlcustoms, in order to supervise what enters and exits their country and to impose taxes on certain items. They may have certain alliance with other nation states, such as in the EU, to reduce trade costs. Nation states may also issue an embargo or stop on all business with a country for political reasons.
-Nation states are also important for foreign investors as sometimes the banks in other countries offer safety and/or revenue, ex. Swiss banks have provided a neutral, non-war country with a gold standard
Leadership policies
Dictatorship - Iraq
Rule by a single leader who has not been elected and may use force to keep control. In a military dictatorship, the army is in control. Usually, there is little or no attention to public opinion or individual rights.
Totalitarian – China
Rule by a single political party.
People are forced to do what the government tells them and may also be prevented from leaving the country.
Theocracy – Iran
A form of government where the rulers claim to be ruling on behalf of a set of religious ideas, or as direct agents of a deity.
Monarchy – Jordan
A monarchy has a king or queen, who sometimes has absolute power. Power is passed along through the family
Parliamentary – Israel
A parliamentary system is led by representatives of the people. Each is chosen as a member of a political party and remains in power as long as his/her party does
Republic – US
A republic is guided by representatives of the voters. Each is individually chosen for a set period of time. While the US is often considered a democracy, that is an optimistic description as a true democracy would mean always led by the majority and does not exist accept only temporarily until some leader is appointed.
Anarchy – Afghanistan
Anarchy is a situation where there is no government.
This can happen after a civil war in a country, when a government has been destroyed and rival groups are fighting to take its place.
Foreign policies are the strategies of relationships with other countries and can boost or limit the economy and international business.
Do Nothing
Presidential Statement
Call for Negotiations
Propaganda
Economic Aid
Economic Sanctions
Military Advisors
Military Presence
Military Threats
Blockade
Troop Mobilization
Subversive Action
Bombing
Use of Troops/Invasion
Politics as a positive influence on business
Nation states try to improve the environment and relations for business, they want businesses to do well in order to help the nation’s larger economy. These are 4 ways a nation state encourages business
1 – A nation state often holds a science and technology policy, that offers incentives and encourages development through tax breaks and also now controls environmental damage.
2 – Nation states listen to businesses as businesses may sometimes have lobbyists who appeal governments for certain changes
3 – Nation states are constantly seeking conflict resolution with other nation states which helps businesses avoid smaller conflicts.
4 - Nation states may also on rare occasion come to the aid of economically suffering major corporations
More on lobbyists
Case study: Principality of Sealand
-A freestanding, large, elevated sea barge, Sealand is a completely independent economic, social, political, and geographic state in the North Sea since 1967 by Major Paddy Roy Bates
-Sealand has been involved in several commercial operations, including the issuing of coins and postage stamps, and the establishment of an offshore Internet hosting facility or "data haven". Because it is outside any larger government it allowed for somewhat “lawless” business practice.
-Not all Sealand activities were authorized, including the issuing of camouflage passports that were associated with several crimes. Camouflage passports (CPs) are passports of countries no longer in existence, e.g. former British or Dutch colonies such as Rhodesia, Zanzibar, Dutch Guiana, Netherlands East Indies. These states have usually changed their names, typically after gaining independence. Thus, British Honduras is now Belize, while Zanzibar fused with then time Tanganyika to become today's Tanzania. Upper Volta became Burkina Faso, and of course, some of the most recent examples include the USSR and Czechoslovakia. People may travel with invalid passports of non-states.
-In late June of 2006, Sealand suffered a devastating fire which crippled its infrastructure significantly, decreasing its significance and global role but it still operates as “nation-state.”
Should Sealand should be a recognized nation state?
If Sealand were a natural island would it be ok to operate as a nation state?
Do you think it should be allowed to do internet business?
How does it affect international business when a new nation state appears?
How does a commercial non-nation states effect macroeconomics?
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http://www.stutzfamily.com/mrstutz/WorldAffairs/typesofgovt.html
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