Question

Property Rights and Corruption When looking at a country as a market or investment, the international business must consider the country's legal system. In that assessment, the firm needs to understand the differences between private actions, which refer to theft, piracy, blackmail, and the like from individuals or groups, and public actions, which are those actions taken by politicians and government bureaucrats. Either kind of action would pose a serious threat to the firm's investment or operations. Before the firm can seek legal remedies, it must clearly understand the options open to it.
In a legal sense, property refers to a resource over which an individual or a business holds a legal title. It is a resource that it owns. Countries differ in the extent to which their legal systems define and protect property rights, even those countries that are still nominally communist states. Property rights can be violated, sometimes by governments and sometimes by individuals or groups.
1. Pleae select that whether below items are the Private Action or Public Action?
a. legal mechanisms
b. theft or blackmail
c. organized crime/ protection money
d. bribery
e. weak legal system
f. corruption
Options:
O Private Action
O Public Action

Answer 1

Answer:

Property Rights and Corruption

Private Action or Public Action:

a. legal mechanisms  = Public Action

b. theft or blackmail  = Private Action

c. organized crime/ protection money  = Private Action

d. bribery  = Private Action

e. weak legal system  = Public Action

f. corruption = Private Action

Explanation:

Eclectic Paradigm is a three-tiered evaluation process which a company that plans to go international must follow in determining whether it would profit the company better limiting its operations to the domestic market or extending its operations to the international market.

The eclectic paradigm is called the OLI model or framework.  It examines the Ownership Rights, Locational Advantages, and Internalization Factors.  This helps the company to make decisions that are beneficial to it.

Property rights and corruption are aspects of the Ownership Rights that must be considered.  Failure to put these factors into consideration may expose the company to risks and uncertainties and greatly reduce the ability of the company to increase economic benefits arising from transactions.