Chapter 10: Differences in Political and Legal Systems Around the Globe and Their Impacts on International Trade
Chapter 10 Introduction
Learning Objectives
After reading this chapter, you should be able to
- Discuss the national differences in political systems of different countries.
- Discuss the national differences in legal systems of different countries.
- Identify risks associated with different political and legal systems.
- Explain strategies to mitigate risks arising from political and legal systems.
Think About It!
Video: Political Risk Explained
In this video from the International Hub Shad Morris, Professor of International Business at Brigham Young University, explains how to identify and mitigate political risk.
Source: InternationalHub (2021, January 1). Political risk explained: How to reduce political risk. [Video]. YouTube. https://youtu.be/QXMZ3wWRiyo?si=adMV8c5ssyqe3Aaw
Reflection Questions
Before we begin, we encourage you to reflect on the following questions:
- Explain at least two political risks associated with a given country or government.
- Discuss some of the strategies businesses can adopt to mitigate political risk.
Introduction
Countries are different from each other in many ways. They have different political, legal, and economic systems. They also differ in their level of development and the societal culture, education, and skills levels of their population. The focus of this chapter and the next three is to explore those differences, describe the level of associated risks with each system, and discuss risk mitigation strategies that can be implemented by organizations operating in international markets.
