The similarity between international business, international transaction and international trade are described below. International trade is voluntary exchange of goods, services, assets, or money between residents of two countries. According to Alan M. Rugman and Richard M (2000:154) International trade is the branch of economics concerned with the exchange of goods and services with foreign countries or among countries across national boundaries. Some of the basic similarity between international trade and international business are listed below:
* Trade arises because of regional differences in production and productivity. * They also arise because of great variations in the location and distribution of natural resources. * Both arises because some countries specialize in the production of certain goods and services and they are known by their skills. * Extent of foreign investments: Foreign investment can boost trade in developing countries which lack in capital required for the development of industries and agriculture. * Transport: With expansions of rail, ocean and air transport, better means of refrigeration and preservation, trade has expanded. It means international businesses are expanded.
International business refers to commercial activities performed to promote the transfer of technologies, goods, services, resources, people, and ideas across national boundaries. International business occurs under many
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Some of the similarity between international business and international transaction are listed below: * Cross border participation. * Foreign currency. * Different laws applied across borders. * Transfer of goods/services across borders. * Basically, any flow of value across borders. An international transaction is the particular activities of selling and buying of items produced in a different country. It would have to be conducted in a manner that is in compliance with the trade regulations that are in place for both countries involved. This required that both the buyer and the sellers be aware of those regulations and make sure the goods, the mode of shipping, and the documentation prepared is in line with these regulations. Failure to do so can lead to delays in delivery and possibly lead to refusal by the receiving port to allow the goods to be unloaded. Some of the similarity between international trade and international transaction are:
* Both of them are abide by rule and law that govern two parties equally. It means there is an agreement between two parties before engaging in international trade or international transaction. * World trade organization (WTO): Is an umbrella organization that governs the international trading and transaction system. * International trade follows different law of behavior from those of domestic trade. This reason, in a way, tends to point out the distinguishing attributes of international transaction. Some of the major difference between International business, international trade and international transaction are described below. * International business is wider than international trade. International trade consists of transaction that are devised and carried out across national borders to satisfy the objectives of individuals and organizations.
* International business is a much broader concept and includes international trade, direct foreign production or any other activity across countries conducted by an entity in managing and carrying out its operations. * There are two types of trade. They are: i) Bilateral tradeii) Multilateral trade * Some types of international business activities are: Importing and exporting, Foreign Direct Investments, Licensing, Franchising, Management contract. Generally, international trade is a much narrow set of activities and consists of exports and imports (e.g. goods and services) only. * International business in not only consist of international trade and foreign manufacturers but it consist of the growing service industry in such area as transportation, tourism, banking, advertising, construction, retailing, wholesaling, and mass communication.