International Business
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For many global companies, China represents a very attractive market in terms of size and growth rate. Yet, it ranks lower in terms of economic freedom and higher in political risk than other country markets because it has a communist government. Despite these risks, Volkswagen, Isuzu, and Boeing are just a few of the hundreds of companies that have established manufacturing operations in China. This is due in large part to the Chinese government making sales in China contingent on a company's willingness to locate production there. The government wants Chinese companies to learn modern management skills from non-Chinese companies and acquire technology. Some observers believe that when Western companies agree to such conditions, they are bargaining away important industry knowledge in exchange for sales today. Answer the question:
1. Should Boeing and other companies go along with China's terms, or should they risk losing sales by refusing to transfer technology?
2. Why?
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Solution Summary
This solution is comprised of a simple explanation examining the costs and benefits of doing business in China.
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Hi there,
The answer to your question is rather simple. Throughout the history of the global economy, the organizations that have gone to the top of their sector are the ones that have been ...
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