Theories and Government Intervention in International Business

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Module 3: Reflective Summary
Chapters 6, 7 and 8 contain great lessons on international business. In chapter 6, I learned about theories of international trade, including those in nation-level and firm-level explanations. One theory that I found outstanding is the comparative advantage principle. In this theory, I learned that countries have to compare their abilities in producing various goods and then agree to focus on one product leaving the production of another product to another country. For example, Japan is good at producing cars, while Saudi Arabia has the advantage of producing petroleum products. These two products are interdependent, and the two countries need them. This way, the two countries can export the products they specialize in, allowing each country to benefit from international business.
Chapter 7 explored political and legal systems i...