The Trump administration is attempting to lower imports in order to rebalance trade after decades of U.S. neglect toward economic relationships around the world. Rebalancing should not only be done by applying the stick of import reductions, but also by export promotion.
Exports make a firm’s markets grow and change its home nation’s currency value. When U.S. exports increase, the dollar typically goes up in value.Shrinking exports tend to weaken the dollar. Exports also shape public opinion of globalization and offer the opportunity for economies of scale.Higher production volume often means a lower cost of production.Since high exports also make imports cheaper, a firm may achieve lower costs and higher profits, both at home and abroad, through exports.
Instead of widening the girth of the four business pillars, we should consider to connect them all with a seat which improves comfort and reach. It may be time to combine the doctrine of capitalism with the insights of wisdom and philosophy. We believe the connection represents the soul of business.
I. Innovation Disruption and the Imperative of Curative Marketing
More than 7 decades ago, Joseph Schumpeter regaled us with the concept of creative disruption. He presented successful innovation as only temporary market power, threatening the profits of old firms, yet facing the pressure of new competitors beginning to commercialize their own inventions. Such cyclicality was taken on in greater detail by various subfields in business and society and delivered high explanatory value. Consider the “wheel of retailing” which Stanley Hollander described in the late 1950’s with firms starting at the bottom of the wheel and moving up in terms of services and pricing until they are transitioned out from the wheel by more efficient competitors. Today, the disruption has become more broad scoped with new entrants and their disruptions coming not just from the same industry or even from similar business models.
Globalization, trade and investment deserve our ”Thank You” for their achievements. Yes, currently, in Europe and the United States, popular discontent is forcefully expressed. An introvert trend has emerged, fed by nationalism, populism, xenophobia and anti-globalization rhetoric.
Globalization is not new; it has existed for centuries. What is different today is the speed of globalizing the world, made possible by new technologies, transportation networks, media, and international marketing. Many claim that never before in history has there been so much evidence about strong opposition to globalization. However, any comparison with the past is highly inaccurate. Only few records of resistance to globalization have been preserved for us today.
After a heated and arduous election campaign, it is clear that Donald Trump has won the race for the US presidency. The candidate, who is particularly striking in the election campaign with outrageous speeches and full-bodied announcements, promised to create 25 million jobs, invest massively in the infrastructure, and re-establish trade agreements. So what is coming to the US? Foreclosure and isolation, new tariffs and exploding state debts – How many expert prophesies are there? Will Trump lead to an economic catastrophe or a new miracle? And who are actually Trump’s economic policy consultants? Astrid Petermann discusses with Michael Czinkota, a professor at the Georgetown University in Washington and Valentin Hofstätter, analyst and US expert at Raiffeisen Research, in the Austrian economic magazine SALDO.