International Business Glossary

The ability of a country to produce a good using fewer resources than another country.

A comprehensive record of all economic transactions between a country's residents and the rest of the world over a given period.

The ability of a country to produce a good at a lower opportunity cost than another country.

The collection of risks associated with investing or operating in a particular country, including political, economic, and sovereign risks.

The capability to function effectively across national, ethnic, and organizational cultures.

An agreement among countries to eliminate tariffs between members and adopt a common external tariff.

The practice of exporting goods at a price lower than the normal price in the domestic market or below cost of production.

The price of one country's currency expressed in terms of another country's currency.

Government seizure of foreign-owned assets, typically without adequate compensation.

An investment involving at least 10% ownership stake in a foreign business entity, implying lasting management interest.

An entry mode in which a firm grants rights to use its brand, business model, and systems in a foreign market in exchange for fees and royalties.

A region where member countries have eliminated tariffs among themselves but maintain separate external tariffs.

A form of FDI where a company builds new facilities in a foreign country from scratch.

A risk management strategy using financial instruments to offset potential losses from exchange rate fluctuations.

A framework for understanding cultural differences across countries based on six dimensions: power distance, individualism, masculinity, uncertainty avoidance, long-term orientation, and indulgence.

A cooperative business arrangement in which two or more firms from different countries create a jointly owned and managed entity.

Granting permission to a foreign firm to use intellectual property such as patents, trademarks, or technology in exchange for royalties.

A firm that owns or controls value-adding activities in two or more countries, also called a multinational corporation (MNC).

Trade restrictions other than tariffs, including quotas, subsidies, voluntary export restraints, and technical standards.

Dunning's framework explaining FDI through Ownership advantages, Location advantages, and Internalization advantages.

The likelihood that political events or conditions will negatively impact business operations in a foreign country.

A government-imposed limit on the quantity of a good that can be imported during a specific time period.

A tax imposed by a government on imported goods, designed to protect domestic industries or generate revenue.

The prices charged for goods, services, or intangible property transferred between divisions of the same multinational enterprise across national borders.

The international body that oversees global trade rules, facilitates trade negotiations, and adjudicates trade disputes among member nations.