Accounting Homework

1. Refer to the KOF Index of Globalization prepared by the KOF Swiss Economic Institute (enter KOF Index of Globalization at globalEDGE). The index uses three different dimensions to measure globalization: economic globalization, political globalization and social globalization. Please explain what each dimension represents in detail and why each is important for a nation to achieve a substantial presence in the global economy.

2. Visit the U.S. Department of Commerce website (www.doc.gov). Identify and describe the most important support functions that the agency provides to the companies that do international business. (you may use a value chain sketch and see what is offered for each function; also some keywords to get you started: international business partner, distributor, marketing and sales, etc.)

1. Economic globalization is measured by the actual flows of trade, foreign direct investment and portfolio investment, as well as the restrictions applying to these flows. There are two categories that make up economic globalization, actual economic flows and restrictions. Actual flows include data on trade, FDI, and portfolio investment. A restriction refers to restrictions on trade and capital using hidden import barriers, mean tariff rates, taxes on international trade and index of capital controls. Economic globalization measurements allow a nation to conduct a SWOT analysis of their trade, foreign direct investment, portfolio investment, and restrictions. This is important because in order to compete with other nations, one must know where they stand and the improvement they can make.

Social globalization is expressed as the spread of ideas, information, images and people. This dimension can be broken into three categories, personal contacts, information flows, and cultural proximity. In other words, this dimension refers to the impact globalization has on the societies, families, and the life and work of people. Hot topics include the impact globalization has on employment, working conditions, income and social protection. Social globalization is import to a nation because it allows them to see how their citizens are being affected by the world around them and how knowledgeable they are about their surrounding neighbor countries.

Political globalization is characterized by the degree of political cooperation. The number of embassies, membership of international organizations, participation in UN Security Council missions, and number of international treaties signed is how it is measured. In simpler terms this dimension of globalization refers to the increasing number and power of human associations with influence or govern the world as a whole. This is important for nations to achieve substantial presences in the global economy because a strong, developed political nation help keep the economy sound.

2. Important support functions that the U.S Department of Commerce provides to companies doing international business include provision and legal advice, Negotiation and enforcement of trade agreements, international trade and investment laws, and litigation.

09, 2013, from http://www.commerce.gov/os/ogc/international-commerce