National Security Interests, Trade Theory, Cross-Border Mergers And Acquisitions and Government Fisc

Core of the Essay for Topic 1: National Security Interests, Trade And Trade Theory

Your answer will be subject to electronic checking for plagiarism. It must be written in your own words (except for quotations), be properly referenced and conform to an essay structure. That is, it must have an introduction stating the scope of the answer, paragraphs that focus on specific building blocks of the answer, and a conclusion that is based on the content of the answer and directly relates back to the subject of the answer. Your essay must be written as a continuous discussion with no sub-headings or bullet points. The discussion must be supported by theory, examples, data and references cited in the text. A list of references must be provided at the end of your essay, which must cite predominantly book/journal articles and authoritative sources.

As is normal practice in the Business School, anyone found to have plagiarised material is likely to fail the module and may be subject to other disciplinary procedures.

The guidance given below show indicative content with quality being dependent on the level of argument, understanding of concepts, originality and a focus on the question (including whether the question seeks a discussion, evaluation, assessment etc.) rather than description and breadth of coverage.

Introduction:
State the purpose of the essay. Define what are national security interests, including reference to geopolitical and supply chain resilience factors, how these represent forms of protectionism and thus conflict with much of trade theory, Why they have become of concern.

Core of the Essay
? The key elements of classical and new trade theory and how these support the case for international specialisation and liberal trade, including the gains from trade held to arse from specialisation according to comparative costs, scale economies, increasing returns to scale and agglomeration economies.
? Distinguish between inter-industry and intra-industry trade.
? The growth of globalisation and offshoring
? Expansion of the concept of national security interests as a form of increasing self-sufficiency, with the intention of achieving more resilient supply chains.
? Protectionism through tariff and non-tariff barriers.
? Arguments used to justify protectionism
? Critical comment on the narrative of economic decoupling and trade reorganisation through reshoring and near-shoring
? Critique of the self-sufficiency drive
It could raise costs and potentially slow advances in technology;
It could result in an overcapacity of certain products, especially less sophisticated (and, thus, less profitable) ones.
The World Trade Organization could be hit with many complaints of unfair trade practices and competition.
After hundreds of billions of investment and many years have been spent, the result could still be not-quite-self-sufficient and high-cost supply chains.

Core of the Essay for Topic 2: Cross-Border Mergers And Acquisitions

Introduction

? State the purpose of the essay. Define the term mergers and acquisitions (M&As). Explain how these can be both domestic and cross-border. Where they are cross-border, they are an important part of foreign direct investment.

Core of the Essay
? What drives M&As depends upon the goals of the actors involved, notably the distinction between normal’ corporate M&As and those undertaken by private equity firms and other acquisition vehicles. Define private equity firms and why these have become more important (low returns on many other investments).
? ‘Normal’ corporate drivers of M&As: the management believe (with the support of shareholders) that the operation will strengthen the company and ‘create value’ (explain what this means) offering opportunities for growth and greater market share, or for ‘defensive’ reasons (for example, to protect market share, remove competition and the long-term survival of the company).
? Since cross-border M&As are a form of FDI one framework for explaining them is that for explaining FDI - natural resource seeking, market-seeking, efficiency seeking, and strategic asset seeking. These terms must be explained.
? Position of the acquiring company: In addition to the above, the position of the acquiring company will influence acquisitions, including: the financial strength and market position of the acquiring company; the availability and cost of credit.
? Behavioural and ‘social’ factors: The significance of management goals and the interests of the M&A business community
? Private equity M&As have a different ranking of drivers. They may seek to restructure companies to generate a return on the private equity company’s investment.
? Target opportunities: These may include: the price of target companies (and reasons for low valuations). Prices can be influenced by exchange rates
? Regulatory issues and sovereign risk: These are further considerations with national security and supply chain resilience having become of recent importance.

Topic 3: Government Fiscal Policy In The Covid Crisis. The Significance Of High Government Deficit And Debt Levels For Fiscal Policy And Economic Growth. 

Introduction
State the purpose of the essay.
Core of the Essay
? The impact of the pandemic on economies and economic growth around the world The reasons for the growth of deficits and debt during the current global pandemic
? Policy responses: distinguish between monetary and fiscal policy
How monetary and fiscal policies have been used and why governments have shifted towards a greater emphasis on fiscal policy Fiscal policy, discretionary and non-discretionary spending, current and capital spending, automatic stabilisers Examples of deficit to GDP and debt to GDP ratios
? The consequences of high government deficits
? The sustainability of high levels of debt. What determines the sustainability of debt?
Deficit and debt sustainability thresholds
The numerator and the denominator in debt sustainability Distinguish between gross and net debt, debt owed to domestic investors and debt owed to foreign investors, other characteristics of debt that may influence debt sustainability
? Options for reducing debt ratios
Inflation
Higher taxes and/or lower spending to reduce the numerator Economic growth to reduce the denominator

Monetising the debt
? The impact of high levels of debt: how debt servicing costs divert government spending away from promoting development, resulting in lower rates of economic growth, possible debt default and the consequences of a default. Sovereign debt ratings and the cost of finance The role of the IMF, other international agencies and states in supporting countries with debt problems