Development of Nations in the Global Economy
This paper will focus on how people react to the different types of innovations used in developing countries as they attempt to develop in ways that allow them to compete on a global basis. Many have had the perception that the international community should be doing more to close the gap between developed and developing countries since the aid per capita to developing countries has fallen by 6 percent since its peak in 2010 (OECD, 2013). One could argue that developing countries are at a disadvantage and that the scales are tipped against them. In order to address the different types of inequities that may arise, those in the international business arena must develop policies and procedures that address these issues and create a sense of fairness for everyone involved. Issues such as business ethics, world viewpoint, corporate social responsibility, and trade liberalization will be discussed in order to develop a framework for how developing countries can be positioned to compete with established countries.
Keywords Biotechnology; Business Ethics; Cartagena Protocol on Biotechnological Security; Corporate Social Responsibility; DuPont; Genetically Modified Organisms (GMOs); Multinational Corporation; National Technical Commission on Biosecurity (CTNBio); Social Responsibility; Trade Liberalization; World Development Report
International Business: Development of Nations in the Global Economy
According to the 1999 World Development Report, there was a growing gap in GDP between the developed and less developed countries (World Bank, 1999); however, more recent data suggests that, overall, this gap is shrinking, especially given the rapid economic development of China, India, South Korea, and other Asian countries (World Bank, 2013). Many had the perception that the international community should be doing more to close the gap since the aid per capita to developing countries was reduced by one third in the 1990s; aid rose in the early part of the 2000s, but has shrunk since 2010 (OECD, 2013). “As developing countries made strides to open their economies and expand their exports, they were faced with significant trade barriers” and no aid or trade (Stiglitz, 2000).
"To many in the developing world, trade policy in the more advanced countries seems to be more a matter of self-interest than of general principle." (Stiglitz, 2000, p. 438). It appears that good economic analysis is used solely in favor of the advanced countries in order to support their self-interests. Given the number of opportunities for developing countries to be placed at a disadvantage, supporters of trade liberalization argue that standard economic analysis would benefit a developing country. Common economic theory reasons that losses in one sector will be gained in another sector (i.e. job loss in one sector will be offset by job creation in another sector). However, this relies on the assumption that the markets are functioning properly, which is not always the case. As a result, the anticipated jobs may not be created in another sector, and the process becomes unbalanced. When situations such as this arise, supporters of trade liberalization must be prepared to respond to the resultant challenges.
One could argue that developing countries are at a disadvantage and that the scales are tipped against them. In order to address the different types of inequities that may arise, those in the international business arena must develop policies and procedures that address these issues and create a sense of fairness for everyone involved. Many believe that there should be standards for social responsibility and ethics in order to make sure that the developing countries are not exploited. Having a formal global approach to these types of challenges can ensure a sense of fairness for everyone involved in the process.
Khan (2007) introduced a conceptual framework that identified four representational approaches to understanding how social inequities surface in developing countries as they attempt to venture into international business. When the model was created, it was established that there are many parties involved in the process. Since representation ranged from local workers to international mass media organizations, each party was defined in terms of geography. The two categories introduced are locals and foreigners. Locals were defined as individuals or entities that are primarily located in the developing countries. Locals are very diverse and have different perspectives and interests. Individuals falling into the "foreign" category are those that do not fit into the local category. Significant players in the foreign group would include international businesses that are directly involved in specific situations, and their critics.
Four Approaches to International Business
Both of these groups are considered to be "representers" as they work to resolve issues that arise. Each situation is analyzed and evaluated according to the representers' role in the situation and the worldview of the situation. The approaches attempt to conceptualize the representation of the ethical issues involving international business in the developing world. The four different approaches are:
Approach 1 (No-speak): Foreigners are the representers and the issue is expressed from a foreign world viewpoint. The local residents have no voice and they have no input into the world view. Local world views have no place in the development of issues, and the local experience is not considered relevant in social equity issues. Most international business research follows this approach (i.e. Hofstede's Culture's Consequence).
Approach 2 (Us-speak): The commonality between this approach and the first approach is that the foreigners are the representers. However, the difference is that the world view incorporates the local experience. This approach attempts to represent local realities (local view) in a way that the local inhabitants understand the situation. In many instances, the representer places himself in the local's position and attempts to articulate the viewpoint based on the local's perspective.
Approach 3 (Same-speak): The locals are the representers and the world view is the same as the foreigner's perception. Locals represent themselves based on one or more world views that originate from the West (i.e. modernism, post-structuralism, secular nationalism). Many of the most influential representations of ethical issues that affect international business in developing countries are based on this approach.
Approach 4 (Other-speak): Locals are the representers, and international business issues are explained in the context of local viewpoints. When evaluating this approach, representation is being explained by locals using local concepts.
These approaches provide an explanation as to how foreigners and locals perceive the severity of social issues; an important element to the interactions in the business community. Multinational corporations have to understand the culture and values of the countries in which they do business. Otherwise, the corporation may suffer as a result of conflict on social and business ethics issues. There has to be some sense of social responsibility on the part of the multinational corporation.
Developing Social Responsibility
According to Griesse (2007), "the introduction of new agricultural biotechnologies has raised a number of concerns regarding the safety of the product for human or animal consumption, the affects the product may have on the environment, the question of patenting living organisms and the power large corporations have over cultivation and food supply" (p. 103). These concerns have created much debate and division in the scientific research field as well as the international business community when it comes to deciding on the best way to feed the growing world population. In addition, many believe that these new technologies force the world to re-evaluate its views on social responsibility. Some of the key questions that need to be addressed include:
- What is the role and responsibility of corporations when laws do not address the issues of the new technologies?
- What are the procedures that governments, scientists and corporations should follow when developing and approving new technologies?
- What are the new issues that...
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