China the factory of the world - China and globalization

6 important questions on China the factory of the world - China and globalization

What are low wage economies?

Country where the workers are paid low wages.

Is there also a market for luxury goods in China?

yes, especially TVs, mobile phones and cars. Every day, another ,12,500 cars leave the factory

What are economic and political factors?

The main economic factors are wage level and education of the workers. The main political factors are laws, taxes, regulations and the willingness of the government to cooperate
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What role do economic and political factors play when a company decides to do business with China?

Economic factors: cheap labour, cheap land
political factors: low wages, supple laws (labour, eviroment)

What is a head-and-tail company?

Phase 1 (design and development) and phase 3 (marketing and distribution) happen in a rich country, phase 2 (manufacture) happens in other, cheaper countries.

Is Nike a head-and-tail company?

Yes, because the headquarters are in the US, production is in Asia and distribution is in the US/Europe

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