• Western Governors University

• FVC 1   Global Business

C6 THE LEGAL AND POLITICAL ENVIRONMENT
OF GLOBAL BUSINESS
Political Systems: Democracy vs. Totalitarianism
 Democracy it refers to a form of government in which all
citizens have the right to vote.
 Athenian democracy – pure form of democracy where
all adult citizens vote directly on matters affecting
the community.
 Representative democracy – form of gvt. in which
citizens vote to elect given individuals to serve as
their representatives for a certain period of time.
 A totalitarian government is a system in which individuals govern
without the support or consent of the citizenry.
National Economic Ideologies
 Communism - represents an economic ideology whereby
the government or state owns and controls all the major
factors of production ie China
 Socialism involves an economic ideology in which the
government or state plays a strong role in the economy and
may own stakes in certain businesses. Unlike communist
countries, however, countries with socialist economies do
not aspire to be “classless.” That said, such economies tend
to be somewhat more collectively than individualistically
oriented, with disparities in income and wealth less extreme
than in capitalistic countries ie France, Great Britain, Spain.
 Capitalism refers to an economic system where businesses
are privately owned with a strong individualistic profit