The Global Environment of Business
| Published date | 01 October 2011 |
| DOI | http://doi.org/10.1111/j.1758-5899.2011.00136_4.x |
| Author | Andrea Filippetti |
| Date | 01 October 2011 |
distinguishing between information gathering and policy
making; while it is clear that solutions for global chal-
lenges that have huge social impacts, such as climate
change and global economic imbalances, require world-
wide cooperation, aspects of such international policy
making, such as information gathering and monitoring,
may best be accomplished at lesser levels. The 2005
world summit called upon the UN to expand consulta-
tion and cooperation with regional organizations, and
the authors likewise suggest convening high-level meet-
ings. To move this proposal forward, the G20 process
might also be included. Informal and formal arrange-
ments, global and regional international organizations
are the building blocks of a new multilateralism, and the
book is a useful contribution to this endeavor.
Thierry Soret
Thierry Soret is Policy Advisor on Global Governance,
United Nations Development Programme.
The Global Environment of Business by Frederick
Guy. Oxford: Oxford University Press, 2009. 332 pp.,
£75.00 hardcover, 978-0-19-920662-9.
This book deals with the extremely complex institutional,
technological and policy context in which companies
organise and manage their production processes. It
seeks to explain the history and causes of the rise of
multinational companies, as well as local and regional
clusters of small and medium-sized companies. The
author also addresses how huge countries such as China
and India progressively play a role as reserves of inex-
pensive and increasingly educated workers, and how
yesterday’s emerging economies such as the Asian Tigers
also play a greater part in international trade. The
increasing prominence of regional blocs as key global
actors is also analysed.
Guy outlines four factors that make the globalisation
of business such a complex process. First, national poli-
cies are still relevant in shaping the global business
arena. Second, multinational corporations are key actors
in technology transfer and knowledge diffusion across
the world. Third, economic systems work according to
specific rules of the game, which are contingent upon
diverse institutional settings. These institutional settings
can be tracked back to the Napoleonic Code or a coun-
try’s colonial legacy. Finally, the relentless progression of
technological change has made the world increasingly
flat and has significantly affected the organisation of
business.
Globalisation is not automatically taken as a determin-
istic and inevitable process to which states, companies
and people passively react. On the contrary, the dramatic
process of global integration is understood as the result
of deliberate policies that reflect specific actors’ interests
and strategies. The author shows how, in the last part of
the 19th century, trade policies shaped by the interests
of specific industries led to high tariffs and a sharp
decline in free trade.
The author attaches key importance to recent techno-
logical advancements, namely distance-shrinking tech-
nologies and production systems. As he states, ‘liberal
trade regimes come, and they go …technology, on the
other hand, keeps accumulating’ (p. 81). These advance-
ments have made it possible and inexpensive to do busi-
ness over long distances and to integrate knowledge
across the globe. However, the point is that this does
not make international economic integration inevitable.
Thus the central question to be answered is why
‘states have chosen to adopt policies that amplify the
integrating effect of technology’ (p. 22). This book
attempts to answer the question relying on economic
history, international economics and trade theory, and
through extensive empirical evidence and stories. This
leads the author to explore the decision-making pro-
cesses and interactions of a wide range of actors, includ-
ing national governments, interest groups and big
business. This diverse, somehow eclectic, approach is the
book’s greatest strength; the author has successfully
brought economics back into the realm of genuine
political economy.
Andrea Filippetti
Andrea Filippetti is a Research Fellow at the Italian
National Research Council – CNR.
ª2011 London School of Economics and Political Science and John Wiley & Sons Ltd. Global Policy (2011) 2:3
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