International Business Operations: A Comparison between Autocratic and Democratic Countries

Running head: INTERNATIONAL BUSINESS OPERATIONS
INTERNATIONAL BUSINESS OPERATIONS
Name of the Student
Name of the University
Author Note

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Introduction
International business operations are related to the process in which goods,
technology and services are traded between the national borders. This is mainly based on the
cross-border transactions which are made with the help of different services and goods. The
transactions based on different economic resources thereby include skills, people and capital
for production of services and goods on an international level. Multinational organizations
which are responsible for conducting business operations in different overseas markets need
to bridge various national markets in a global marketplace1. Two major macro scale factors
are able to affect the process of globalization. First factor is based on the elimination of
different barriers for making cross-border based trade. On the other hand, the second factor is
based on effective technological change which takes place in information processing,
transportation of technologies and communication 2.
The essay will be based on the analysis of differences between international business
operations that are performed by organizations which operate in authoritarian regimes and
liberal democracies. The differences which are experienced between the ways by which
transactions are made between the organizations operating in two types of economies will be
analysed in detail. The major levels of issues which are being faced by the international or
multinational business organizations in different countries will be analysed in the essay in
detail. The advantages and disadvantages of operations of multinational corporations in
autocratic and democratic countries will be an important part of the analysis which will be
done in the report 3.
1 Cohn, Theodore H. Global political economy: Theory and practice. Routledge, 2016.
2 Balaam, David N., and Bradford Dillman. Introduction to international political economy. Routledge,
2015.
3 Dupuy, Kendra, James Ron, and Aseem Prakash. "Hands off my regime! Governments’ restrictions
on foreign aid to non-governmental organizations in poor and middle-income countries." World Development 84
(2016): 299-311.

2INTERNATIONAL BUSINESS OPERATIONS
Comparison based on international business operations
As discussed by Lankina, Libman and Obydenkova4, cross-cultural business
operations or international business based operations have started growing with a rapid pace
in the current environment. The levels of awareness based on the usage of internal resources
is not able to help the country in order to develop its position. The possession of enough
amounts of resources does not exactly mean that the country is able to use the capabilities
effectively. The countries require support or services from different external countries in for
the proper exploitation of resources. Foreign direct investment or FDI is thereby considered
to be highly inevitable for the effective economic progress.
As argued by Bader 5, globalization is helpful for the countries in order to liberalize
different norms and laws which are based on foreign direct investment and international
business. Politics is considered to be an important factor which is related to the ways by
which investments are made in foreign countries. Business and politics are thereby linked
with each other with respect to effective investments made in operations. The business related
activities which are performed in autocratic countries are considered to be different as
compared to those that are conducted in democratic countries.
As discussed by Dean 6, international business faces lesser levels of constraints in the
liberal economies or democratic countries as compared to the autocratic countries. For
example, an American organization will face lesser troubles in their operations in democratic
countries as compared to operations in an autocratic country. An organization like Google
4 Lankina, Tomila, Alexander Libman, and Anastassia Obydenkova. "Authoritarian and democratic
diffusion in post-communist regions." Comparative political studies 49, no. 12 (2016): 1599-1629.
5 Bader, Julia. "Propping up dictators? Economic cooperation from C hina and its impact on
authoritarian persistence in party and non‐party regimes." European Journal of Political Research 54, no. 4
(2015): 655-672.
6 Dean, Mitchell. "Rethinking neoliberalism." Journal of Sociology 50, no. 2 (2014): 150-163.

3INTERNATIONAL BUSINESS OPERATIONS
will thereby face fewer problems in the operations in India in comparison to the operations
which are performed in China. The major reasons behind withdrawal of Google from China
are based on the censorship policy and the human rights based violations in the country.
According to Ruhs 7, the business operations that are conducted by Google are based
on its duty related to information which is provided to the users. The information which is
provided by Google to the consumers in China is not acceptable by the government and their
interests. News related to different controversial incidents are not allowed to be provided in
China. Google is restricted from providing different information based on news which can be
offered to the users as there are chances of major issues which can be take place in the
country. The possibility of riots which can take place in the country is also quite high if news
is spread among the customers. Google has thereby taken the decision to withdraw its
operations from China in spite of the huge growth based opportunities which are offered by
the market 8.
Google has not faced any major difficulties related to spreading news in liberal
countries like India. The organization is thereby able to provide effective information based
on different issues without any barrier. The news related to criticisms which are faced by the
Prime Minister of India related to different steps taken by him in the country have been
provided without any barriers to the users in the country. The multinational organizations
which have their operations in the country are allowed free trials due to the liberal
environment that has been developed in India 9.
7 Ruhs, Martin. "Labor immigration policies in high-income countries: Variations across political
regimes and varieties of capitalism." The Journal of Legal Studies 47, no. S1 (2018): S89-S127.
8 Wilson, Jeffrey D. "Understanding resource nationalism: economic dynamics and political
institutions." Contemporary Politics 21, no. 4 (2015): 399-416.
9 Moon, Chungshik. "Foreign direct investment, commitment institutions, and time horizon: How some
autocrats do better than others." International Studies Quarterly 59, no. 2 (2015): 344-356.