International business law (2006)

Résumé du document

In most parts of the developed countries the economy is regulated through liberal systems. A liberal system means that there exists open markets and competition over these markets. States and governments are not the leaders of these markets. They are only the institutions which have created rules to make the system efficient. Institutions are in charge of the regulation of the market, that is to say that governments are just the referees of the market. They have to control the good application of the rules and may be the drivers of growth when the economy is declining. For example, in France, the government was active during the 90's, even more so when Edouard Balladur was Prime Minister. Effectively, during the year 1993, government was present in French economy to increase French development and French growth. Balladur tried to boost the automobile industry which had suffered a severe economic crisis. His government offered to French inhabitants various incentives to renew their cars.

Extraits

[...] This court recognized that Microsoft was in a monopoly situation but it broke the decision made by the first tribunal. Microsoft won the battle and had the right to keep the same structure as before. Nevertheless, Bill Gates had to make 3 main concessions to convince the tribunal: - First of all, Microsoft accepted to give to the computing manufacturers the choice to work or not with its software, or to work with competitors' softwares. Effectivelly, before this agreement, Microsoft was used to penalize the manufacturers who don't produce exclusively computers set up with Microsoft softwares. [...]

[...] Every car sold during this period was called “Balladurette”, because it was the decision of the former French Prime Minister. In addition, governments have to control the good application of market rules. Effectively, even if firms are woking through a liberal system, they have to respect some fundamental rules to make the liberal market efficient. For example, monopolistic situation are forbidden by international laws for various reasons. Governments, without running firms policies, have to punish firm which don't respect fundamental rules. For example, the case of Microsoft is a real problem in our liberal economy. [...]

[...] They decided not to compete to much on this segment in order to keep a high price in this low cost service. This agreement was denounced by a consumer protecting organization. The organization sued the three competitors for illegal competition and won the judgement. French government has punished the three competitors and has obliged them to compete on this segment. Since this government action, SMS prices have decreased not to penalize consumers. Blocked Entry The reason why a pure monopolistic firm has no competitors is that certain barriers keep the potential competitors from entering the market. [...]

[...] International Business Law (2006) Introduction In the most part of developped countries economy is regulated through out liberal systems. A liberal system means that it exists open markets and competition over these markets. States and governments are not the leaders of these markets. They are only the institutions which have created rules to make the system efficient. Institutions are in charge of the regulation of the market, that is to say that governments are just the referees of the market. [...]

[...] Even if prices have decreased all over the country, social service has vanished. UK railroad is to my mind one of the illustration of bad effects some open markets. Contrary to this case, the opening of Airlines market in France was better done. Government has opened a certain percentage of the market to the competition what has decreased the ticket prices without decreasing the social service. Even if all the competitors are diserving the principal destinations, Air France is still deserving the non rentable towns, what provides the land settlement policy of the French government. [...]