Global Business Environment: Benefits and Drawbacks - Fall 2023

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THE BENEFITS AND DRAWBACKS OF A
GLOBAL BUSINESS ENVIRONMENT
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Table of Contents
1. Introduction..................................................................................................................................2
1.1 Background of the research....................................................................................................2
1.2 Research aim..........................................................................................................................2
1.3 Research objectives................................................................................................................2
1.4 Research questions.................................................................................................................2
1.5 Rationale of the study............................................................................................................2
2. Literature review..........................................................................................................................3
2.1 Importance of global business environment..........................................................................3
2.2 Benefits of globalization........................................................................................................4
2.3 Drawbacks of globalization...................................................................................................4
2.4 Theories..................................................................................................................................5
3. Methodology................................................................................................................................6
3.1 Research philosophy..............................................................................................................6
3.2 Research Approach................................................................................................................6
3.3 Research design......................................................................................................................6
3.4 Data sources...........................................................................................................................6
3.5 Data techniques......................................................................................................................6
3.6 Sample size............................................................................................................................7
4. Timeline of the research..............................................................................................................7
Reference list...................................................................................................................................9
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1. Introduction
1.1 Background of the research
Global business environment plays a crucial role to bring business benefit of a company on an
international level. The presence of globalisation has managed to bring numerous benefits in
different emerging and developed countries across the world (Olimpia, N. and Stela, 2017, p.
31). It includes positive impact on the education, technology, competition, capital flow, culture
and trade of a country. The demographic segments of the society are seen to be highly impacted
due to the presence of globalisation. The foreign investments and the competition of the various
companies get highly influenced in such scenario.
1.2 Research aim
The aim of the research is to analyse the benefits and drawbacks of global business environment
in the current times.
1.3 Research objectives
The objectives of the study have been given below.
 To critically extract the benefits gained by global business environment
 To critically extract the drawbacks faced due to the global business environment
 To evaluate the impact of globalisation on a global context
 To recommend strategies to overcome the challenges due to globalisation
1.4 Research questions
The following section shows the research questions of the study
 What are benefits gained by global business environment?
 What are the drawbacks faced due to the global business environment?
 How globalisation impacts on a global context?
 How to overcome the challenges that happen because of global business environment?
1.5 Rationale of the study
In the current times, globalisation surely plays a major role in order to bring significant
development of a country. Many multinational companies engaged in the global business
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environment, precisely gain a lot of benefit by trading and doing business with foreign countries.
It is observed that the competitive pressure of the globalisation can prompt the improved
governance along with better protection in labour.
In addition to that, opening the capital markets allow the developing countries for borrowing
money to fill up a domestic gap of savings (Gunn, 2017, p. 42). However, many negative
impacts have been found while commencing business on a global environment. Despite of all the
positive impact, many emerging and developed countries face major to minor challenges.
Therefore, the current study aims to showcase the positive and negative effect happened due to
the impact of globalisation.
2. Literature review
2.1 Importance of global business environment
The international trade environments is quite vibrant and diversify. It is responsible to benefit
both of the parties involved into globalization. It is observed that, countries with higher level of
global trade are having strong and stable economies. Along with that, they provide better
standards of living with the presence of steadier growth opportunities. Moreover, the exporting
helps to boost the high economic development of a certain country along with raising the actual
livings standards. As opined by (Sharma, 2016, p. 253), the presence of global business
environment also plays a key role to eradicate poverty from many emerging countries in the
current scenario. The current exported goods across the world are around 25% that has increased
massively since the last decade.
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Figure 1: growth of income along with trade
(Source: Bretos and Marcuello, p. 51)
The above demonstration shows the growth of income along with trade in the year 2014. The
countries have been placed with the change of annual growth in their real GDP per capita from
the year 1945 to 2014.
2.2 Benefits of globalization
The presence of globalization has been mentioned in the following section.
 It encourages producers as well as consumers to benefit from economies of scales. It also
includes gaining benefit from the deeper categories of labour.
 According to Potrafke (2015, p. 509) the advantages can also be gathered from the free
movement of various labours between different countries.
 Significant gains from sharing skills, technologies and ideas are also noticeable.
2.3 Drawbacks of globalization
The main drawbacks of having globalisation is explained in the following section.
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 Globalisation has been proven to bring inequalities and wealth in resects to different
countries. In such categories China, India and Brazil are visible in terms of their rural and
urban division.
 The strong demand in food along with energy has been found to cause a steep rise at
commodity prices. The price inflation of food has been found to place millions of poor
people across the world at risk.
2.4 Theories
There are two theories that have been selected in order to give theoretical support to the study
which are.
 Comparative advantage theory of international trade
According to Donato and Massey (2016, p. 25), comparative advantage could be seen when a
country tends to produce a particular good or service at a lower cost while compared to other
countries. It is observed that the opportunity cost helps to measure a trade off. On the other hand,
a nation having a comparative advantage is able to worth their tradeoffs. Application of this
theory can help companies to produce the goods or service by using fewer resources and also
with a lower opportunity cost.
 Monopolistic advantage theory
The monopolistic advantage theory is an approach within the field of international business. The
theory helps to explain that why a certain firm can compete with its indigenous competitor in the
foreign market. As opined by Lane (2016, p. 51), application of this theory can show that firm
can use FDI in order to control specific resources that basically arise from the power of
monopoly. It helps to operate in the foreign markets in a profitable way.
2.4 Gap of literature
There are numbers of previous research works that have been performed on the basis of the
importance of the globalisation along with their drawbacks on a particular country. However, the
concerned research study aims to find out the drawbacks and benefits gained by the presence of
the globalisation on a worldwide aspect. The impact of the globalisation is also explained in this
study that fulfils to bridge the gap between previous research works and the current one.
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3. Methodology
3.1 Research philosophy
There are majorly four types of research philosophies available which are pragmatism, realism,
interpretivism and positivism (Cuervo et al. 2017, p. 240). The undertaken research is based on
the static data from the secondary sources and quantifiable data from the primary sources.
Therefore, positivism will be followed in order to measure the data in a structured way.
3.2 Research Approach
In research methodology, there are three research approaches which are followed by researchers.
They are deductive, inductive and abductive. Deductive approach will be suitable for the
research as it will aim to test the validity of the assumptions pr hypotheses (Mackey and Gass,
2015, p. 50). On the other hand inductive and abductive research approach has been neglected as
no new theories are aimed to be developed along with surprising facts.
3.3 Research design
There are majorly three kinds of research designs observed in research methodology, such as
exploratory, explanatory and descriptive (Fletcher, 2017, p. 182). As the research is highly based
on the statically data gathered from the primary data, therefore descriptive design will be chosen
for describing the process involved.
3.4 Data sources
In order to collect data, the researcher will utilise both primary and secondary data. The
secondary data will be obtained from various books, journals, government websites and online
articles (Walliman, 2017, p. 47). On the other hand, primary data will be accumulated with the
help of survey and interviews amongst the employees and managers from different MNCs of
UK.
3.5 Data techniques
In terms of data techniques both, quantitative and qualitative techniques will be applied. The
quantitative technique will be applied due to the collection of data from survey. On the other
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hand, qualitative technique will be applied for interview sessions (McCusker and Gunaydin,
2015, p. 540).
3.6 Sample size
The primary data will be collected from 100 employees and 3 managers of different MNC’s of
UK. This will give a proper support by the vast amount of collected data.
4. Timeline of the research
In order to conduct the research, the researcher has to follow a number of activities that will aid
to achieve desirable results in a well structured way. There are total ten weeks which have been
given for accomplishing the research study. The activities or the stages of the research work have
been properly justified with the help of provided timeline in the process. From there topic
selection to the submission of the research study, all of the activities have been properly
mentioned with the division of weeks.
Research activities
or stages
Week
1
Week
2
Week
3
Week
4
Week
5
Week
6
Week
7
Week 8 Week
9
Week
10
Selection of topic 
Data collection
(secondary sources)
 
Layout creation 
Literature review   
Research Plan
formation
 
Appropriate
Research Techniques
selection
 
Data collection
(Primary sources)
 
Analysis and
interpretation of the
data collection
 
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Findings of Data  
Conclusion to the
Study
 
Rough Draft
Formation

Final Work
Submission

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Reference list
Bretos, I. and Marcuello, C., 2017. Revisiting globalization challenges and opportunities in the
development of cooperatives. Annals of Public and Cooperative Economics, 88(1), pp.47-73.
Cuervo‐Cazurra, A., Mudambi, R., Pedersen, T. and Piscitello, L., 2017. Research methodology
in global strategy research. Global Strategy Journal, 7(3), pp.233-240.
Donato, K.M. and Massey, D.S., 2016. Twenty-first-century globalization and illegal migration.
The ANNALS of the American Academy of Political and Social Science, 666(1), pp.7-26.
Fletcher, A.J., 2017. Applying critical realism in qualitative research: methodology meets
method. International Journal of Social Research Methodology, 20(2), pp.181-194.
Gunn, S., 2017. Globalisation, education and culture shock. Taylor & Francis. . 38(2), pp.40-81.
Lane, J.E., 2016. Globalization–The juggernaut of the 21st century. Routledge. 38(2), pp.50-52.
Mackey, A. and Gass, S.M., 2015. Second language research: Methodology and design.
Routledge.
McCusker, K. and Gunaydin, S., 2015. Research using qualitative, quantitative or mixed
methods and choice based on the research. Perfusion, 30(7), pp.537-542.
Olimpia, N. and Stela, D., 2017. Impact of Globalisation on Economic Growth in Romania: An
Empirical Analysis of Its Economic, Social and Political Dimensions. Studia Universitatis
„Vasile Goldis” Arad–Economics Series, 27(1), pp.29-40.
Potrafke, N., 2015. The evidence on globalisation. The World Economy, 38(3), pp.509-552.
Sharma, S., 2016. Impact of globalisation on mental health in low-and middle-income
countries. Psychology and Developing Societies, 28(2), pp.251-279.
Walliman, N., 2017. Research methods: The basics. Routledge.
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