International business means when company carries out its activities outside the boundary of home/ parent country (Dunning, 2012). This project will explain Hofstede model, types of economic systems and its effect on society and social inequalities, and what implication does social inequalities have for multinationals.
Reasons of globalisation
Improved transport, making global travel easier.
For improving technology which makes it easier to communicate and share information around the world.
Reduced tariff barriers
For raising mobility of capital and labour.
Benefits of free Trade
Free trade means when organisations are doing import and export without any tariff barrier. It helps to all countries because-
It usually boosts the quality of life for a nation because it provides more options or opportunities to consumers.
It develops innovation because the flow of trade circulates new ideas.
It minimizes the corruption in country.
Features of Cultures High on Power Distance
In this people are dependent on person who have strong power.
Society doesn't question the decision of leader and there is no close relationship between people and leaders who only want to earn more money.
In society, there are inequalities among people and unequal distribution of power (Minkov and Hofstede, 2011).
Management Implications with Cultures
They are similar in some respect and different in others. Dimensions can be grouped in following way-
Society selects that way to cope with the inherent uncertainty of living. In this Hofstede identifies three dimensions like masculinity, uncertainty avoidance and power distance.
Hofstede differentiates between a long-term versus short-term orientation (Folsom and et.al.,
Globe Cultural Framework
Globe means “Global Leadership and Organisational Behaviour Effectiveness”. It is research programme extended Hofstede 's work by investing cross cultural leadership behaviour to help the manager. This framework is different from Hofstede framework in the following manner-