Deficit financing is understood in different ways in different countries. It is understood as the excess of current expenditure over current revenue which is financed either through public borrowing or the creation of new money by the government. So the deficit budget is also called deficit financing in USA. But in India deficit financing is understood in a different way from deficit budget. While the former refers to a situation where the current expenditure exceeds current revenue of the government, the latter is taken to mean the excess of aggregate expenditure (both on current and capital accounts) over aggregate revenue. The former is called deficit budgeting and the latter deficit financing in India. Deficit financing in Indian context refers to the meeting of budgetary deficit through the creation of new money adding to the existing money supply in the economy. Deficit financing includes any or all of the following in Continue reading
Global Business Environment
Issues of International Technology Transfers
International technology transfer is the process by which a technology, expertise, know how or facilities developed by one business organization (MNC in the case of international business) is transferred to another business organization. There are many issues associated with the international technology transfer. The most important international technology transfer issues are; ways of technology acquisition, choice of technology, terms of technology transfer, and creating local capability. Modes of Foreign Technology Acquisition One of the major issues in technology transfer relates to the mode of acquisition. Developing new technology may conjure up visions of scientists and product developers working in R&D laboratories. In reality, new technology comes from many different sources, including suppliers, manufactures, users, other industries, universities, government, and MNCs . While every source needs to be explored, each firm has specific sources for most of the new technologies. For example, because of the limited size of most farming operations, Continue reading
Business Competition – Meaning and Types
Meaning of Competition To a particular business, competition usually refers to firms that market similar or substitutable products in the same geographic area. In general, the term business competition refers to the rivalry among businesses for consumer dollars. For example, the manager of a fast food outlet in an airport views all other fast food outlets near the airport as competition but probably does not think fast food outlets in other geographic areas as competition. In general, all the fast food outlets near the airport compete for passengers’ dollars. In developing and implementing a marketing program, an organization must consider the types of business competition in its markets and assess the actions of its competition. Types of Business Competition The number of organizations that sell a product may affect the strength of competition. When there are many business selling a particular product, for example, price considerations and product differences are Continue reading
Social Entrepreneurship in India
Social entrepreneurship as the concept was coined long ago but has been in the corporate parlance in just the recent past. Traditionally, entrepreneurship has been associated with profit making individuals who aim high and achieve a lot for themselves in the world of tough competition. And the success of enterprise was and is being judged on parameter like return on investment and net income margins. But, with the empowerment and awareness of the citizens of the developing world, a new revolution has started, particularly among the youth of the world. This revolution is the growth of Social Entrepreneurship – the form of entrepreneurship where profits are not the end result, but just the means to achieve the end result of social upliftment and further empowerment. Social entrepreneurs play the role of change agents in the social sector by adopting a mission to create and sustain social value, by recognizing and Continue reading
What is Euromarket?
Euro is the currency used by the European Union (EU) countries, so, the market the Euro is used for, can be named Euromarket. It has in view all the transactions done by the banks in Euro currencies, Euro notes, Euro commercial papers, Euro bonds. It is a market that has developed itself in Europe. The market deals with US dollars as well and it can be named Euro dollar market. Currency is borrowed and lent by institutions located in different countries, there is a capital flow which seems to be uncontrolled. Theoretically, it cannot be a national control over this market. From the practical point of view, the market forces dictate the lending rates; the rates do not diverge from the domestic lending ones, it happens only for short interval of time. The international banks are the main operators; financial institutions are also allowed to enter the market. The Continue reading
Business Environment Scanning
The Concept of the Environment Philosophically, the environment of a corporation includes all those realities whose existence may effect the corporation directly in any perceptible way. These realities may be sorted out in the following four categories: The “Community” that is made up of all the human begins that inhabit it and all their social organizations of all kinds The “Culture” that is made up of all the constructs of the human mind that affect the behaviour of all these individuals and organizations The “Habitat” that includes all the physical features of this environment The “Product” that includes all things made and services rendered by man Applying the prevailing culture and using and consuming natural features of the habitat and the product of past periods, the entries of the community have an existence and generate goods and services. Operationally, however, there are two main types of business environment: corporate environment Continue reading