The Rules of Globalization: Case Book

Rawi  Abdelal

Casebook | 2008

The Rules of Globalization: Case Book

Abstract

This is a book about the politics of the global economy — about how firms prosper by understanding those politics, or fail by misunderstanding them. Understanding the politics of globalization may once have been a luxury; it is now, for most high-level managers, simply a necessity. The book contains cases which can be used by instructors and students to build a framework of analysis that enables them to understand the challenges of international trade and investment and master the opportunities they represent. This framework is based on a systematic evaluation of the informal and formal rules that define markets for goods, services, and capital. These insightful cases allow for evaluation of: the political and economic origins of our current era of globalization and how the rules that constrain and enable firms are changing; the impact of governments' policies and which tools are available for predicting, avoiding, or even employing the long arm of the government; and the influence of informal and formal institutions on opportunities for success in international finance and trade.

Keywords: Trade; International Finance; Globalized Economies and Regions; Governing Rules, Regulations, and Reforms; Policy; Government and Politics; Business and Government Relations;

Format: Print

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Abdelal, Rawi, ed. The Rules of Globalization: Case Book. Singapore: World Scientific, 2008.

The prevalence of online platforms opens new doors to traditional businesses for customer reach and revenue growth. This research investigates platform choice in a setting where prices are determined by negotiations between platforms and businesses. We compile a unique and comprehensive dataset from the U.S. daily deal market, where merchants offer deals to generate revenues and attract new customers. We specify and estimate a two-stage supply-side model in which platforms and merchants bargain on the wholesale price of deals. Based on Nash bargaining solutions, our model generates insights into how bargaining and competition jointly determine the price and firm profits. Our results show that there is systematic variation in bargaining power between platforms and merchants with different characteristics. By working with a bigger platform, merchants enjoy a larger customer base, but they are subject to lower margins due to less bargaining power during negotiations. Our counterfactual results quantify the value of platforms for merchants and show that merchants with lower bargaining power benefit more by working with a smaller platform. Regarding the impact of price negotiations on platform competition, we estimate that roughly 11% of the deals on a smaller platform are attributable to the platform’s lower level of revenue sharing.

CareerWise Colorado (CWC) is an organization that equips high school students with the skills to build successful careers through apprenticeships. Founded in 2016, the young organization has attracted interest from different groups and civic leaders from across the U.S., some of whom want to replicate CWC’s model and others who want CWC to bring and then operate its program in their localities.

Noel Ginsburg, CWC’s founder and CEO, and Ashley Carter, COO, now have to decide how, when, and where to grow CWC. They both believe in CWC’s apprenticeship model’s widespread applicability, but so far it is still a relatively small—with just over 200 active apprentices spread across two cohorts, all of whom live in Colorado—and unproven entity. As of late 2018, no apprentices had yet completed the three-year program. They did not want to scale the program too soon, but Ginsburg and Carter also did not want to miss out on the attractive opportunities being presented to them. How should they scale this organization?

Case | HBS Case Collection | October 2018 (Revised August 2019)

Everybody Knows: Russia and the Election

Rawi Abdelal, Rafael Di Tella and Galit Goldstein

Following a contentious presidential race, Donald Trump’s 2016 election destabilized America’s status quo. Academics, journalists, politicians and the public at large examined why Trump had won. Many Americans, inside and outside the government, asserted that a state-led Russian disinformation campaign had influenced the election’s outcome. The leaders of major social media companies, including Twitter and Facebook, also conceded that state actors had gamed their platforms to influence American politics. Trump himself made conflicting statements, while Russian politicians asserted that American elites had rhetorically weaponized the issue of election interference to justify an unwillingness to work with their country internationally. It was hard to parse where reality ended and political rhetoric began. Post-election, the future of U.S.-Russia relations remained unclear, and the United States grappled with how to regulate cyberspace. Analyzing the 2016 election and its aftershocks helps students confront interrelated questions about business regulation, international relations, cultural identity, strategic communications, political will and the Internet. The case encourages students to consider the boundary between narrative and reality and examine subjectivity, objectivity, and power in the public and private sectors.

Keywords: Strategic industry; strategic alliances (business); Business and Government; business and public policy; business and society; Media Businesses; media content; media slant; media regulation; social media; internet of everything; government policy; politics; political campaigns; political strategy; political turmoil; government; Government Regulation; Security; international business; International Relations; National Security; Political Elections; News; Media; Internet; Rights; Problems and Challenges; Globalization; Business and Community Relations; Business and Government Relations; Government Legislation; Risk and Uncertainty; Cognition and Thinking; Conflict and Resolution; Identity; Civil Society or Community; Culture; Public Opinion; Social Issues; War; Online Technology; Public Administration Industry; United States; Russia;

Citation:

Abdelal, Rawi, Rafael Di Tella, and Galit Goldstein. "Everybody Knows: Russia and the Election." Harvard Business School Case 719-012, October 2018. (Revised August 2019.) View Details

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