International Trade Theories: Assignment

The Multinational in Global Production and
Trade Networks

Table of Contents
INTRODUCTION...........................................................................................................................1
MAIN BODY...................................................................................................................................1
Current theories of international business and its application to industry:.................................1
Food industry's global production and marketing orientation:..................................................6
Theories of international business that helps in understanding the food industry......................8
Historical context of the theory's development.........................................................................10
CONCLUSION..............................................................................................................................11
RECOMMENDATIONS...............................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
The Multinational in Global Production and Trade Networks demonstrate production and
trade networks of multinational firm. Different changes occur in organizations considering the
need and requirements of customer's in Australia. These changes can be cultural, technological,
strategic, operational etc. that is significant to attract more customers towards industry (Johanson
and Mattsson, 2015). In this global world, National Competitive Advantage- Porter's Diamond,
New Trade Theory and the Global Value Change theory are implemented for various changes in
international businesses. This report aims at explaining institutional structure and current history
of all three theories in food industry. Moreover, all above theories is also applied in this report to
specify global production and marketing orientation of industry. Further, the report aims in
describing financial information of food industry like Domino's, Mc' Donald, etc. which helps in
deriving its global position and boosting performance worldwide. Lastly, it also covers the
government and civil regulations by implying different theories in food industry.
MAIN BODY
Current theories of international business and its application to industry:
National Competitive Advantage- Porter's Diamond theory, New Trade Theory and
Global Value Change is applied in the industry which helps in expansion of its product
internationally. Further, the focus is made on theories which are applied in business for its better
growth and efficiency. The food industry supplies eatables and beverages that involves grains,
dairy items, seafood, wine and many more that represents it's growth in Australia. There are
mainly Domino's, Mc' Donald’s, and many more (Turkina, Van Assche and Kali, 2016).
National Competitive Advantage- Porter's Diamond theory:

Figure 1: Porter's diamond model
[Source: Arvis, Dairabayeva and Kiiski, 2018]
According to view of Dunning, (2015) Porter’s diamond model or theory of National
Advantages is the framework which is working to find out competitive advantage that nation is
possessing and way in which government can help to improve position of country within global
world. All companies of world could be using the national advantage translating it into
international advantages suggesting that home country of company play very important role in
creating this advantage on global scale as well. As per the view of Clark and Wójcik, (2018) with
the use of Porter diamond model country or company could themselves improve their advantage
with using technological advancements, support of government and skilled labour as well.
As per the above figure there are 4 dimensions of Porter Diamond Model or theory which
is broadly describing all factors. All the factors of this diamond will be linked and related to each
other as these will also be deciding over Domino’s comparative economic advantages
1. Factor condition- This component of Domino’s will be related to their production condition
like that of infrastructure and knowledge as they are the relevant and important factor for
attaining competitiveness of food industry (Amador and Cabral, 2016). The factors are like that
of labour, cost, raw material and commitments of employees towards work. Other factors include
that of quality of research, natural resources like that of minerals and climate were Domino’s is