Contents

• This paper provides answer to the following questions –
• Explain how trade lowers the cost of making computer peripherals such as mice and keyboard?
• Using the theory of comparative advantage to explain the way in which Logitech has configured its global operations. Why does the company manufacture in China and Taiwan, undertake basic R&D in California and Switzerland, design products in Ireland, and coordinate marketing and operations from California?
• Who creates more value for Logitech, the 650 people it employs in Fremont and Switzerland, or the 4,000 employees at its Chinese factory? What are the implications of this observation for the argument that free trade is beneficial?
• Why do you think the company decided to shift its corporate headquarters from Switzerland to Fremont?
• To what extent can Porter’s diamond help explain the choice of Taiwan as a major manufacturing site for Logitech?
• Why do you think China is now a favoured location for so much high technology manufacturing activity? How will China’s increasing involvement in global trade help that country? How will it help the world’s developed economies? What potential problems are associated with moving work to China?

Description

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