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Political Regime and Business - Essay Example

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Political Regimes and Business The political regime in any given country is usually an important factor in determining the kind of business environment that the country will enjoy. This is because the political regime is responsible for putting in place the policies within which business in the country is supposed to operate…
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Download file to see previous pages By an examination of the political regime, one can therefore make the decision to invest or not to invest in a given country. Most countries often have political regimes that are different and diverse in their ideologies and in their practices. An example of two countries with different ideologies is the United States and China. Given the different ideologies in the two countries, the business environment in the two countries is likely to be very different. The changes in the political environment of a given country usually have an impact on the business environment of the country. A stable political regime often means that there will be less tension which will in turn create a positive business environment. The stable political regime also means that it will be easier to start up a business in this environment. The two governments (the Chinese government and the United States government) usually put in place different ideologies that have different impacts on the business environment as will be discussed in the paper (Collins and Block, 2007, p. 130). The term political ideology refers to the set of beliefs and ideals that seek to explain or direct how the society should work and how power should be allocated to the different sectors of the society. A political ideology is therefore a collection of ideas and thoughts on how the society and the different sectors of the society should function and on how best to achieve this ideal functioning of the society. The differences in ideologies followed therefore form the basis of the differences in political regimes. In most political regimes, the old policies that have proved to be ineffective are often replaced by newer policies in an attempt to improve the situation. The political regime of a given country usually has a direct impact on the practices that will be followed in the country which will in turn affect the business. This effect is usually felt in the types of employment contract that are in place in a given country which affect the way that a business hires and treats its employees. The effect is also felt in the human rights treatment which affects the environment under which the business is expected to operate. The political regime in the United States is characterised by a mixture of liberalism and a high level of individualism in their practices. There is also a high emphasis on individual rights and liberties which translates even in the business environment in the country. The country was founded on the principles of democratic republic. At present, the major political parties in the country are the Republican and the Democratic parties. The democratic situation in the United States encourages private ownership of property (Jennings 2010, p. 69). The United States also adopts a free market policy. This means that the prices and other market conditions are regulated by the laws and forces of demand and supply. The government does not interfere with the means of production, and these means are controlled by the private citizens. In this free market, the prices of commodities in this market are as a result of voluntary transactions as opposed to being subjected to government control. Such a policy opens room for competition among various entities. The liberalised government system of the United States presents prospective businesses ...Download file to see next pagesRead More
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