Companies Cooperating with State Governments: Advantages and Disadvantages

Pages: 4 (1170 words) Published: May 6, 2013
MGW2351 International business

Assignment One

1.1 Introduction:
In the age of rapid growth of global business and competition, the issue of whether work with government becomes a serious problem that faced to each company. This essay aims to analysis whether cooperate with States (e.g. government) brings more advantages or disadvantages to companies. It provided an example with each argument when discuss the natural beneficial of close linking between government and company.

2.1 Exchange information with government
Recently, innovation (include research and development) seems as an important part of fast growth of a company. There is strong evidence shows that company cooperate with government can get more information for innovation, the exchange of information is especially important for the “research and development intensive” company, because information is a key element of technology growth (Mohnen & Hoareau, 2003). Indeed, According to Mohnen and Hoareau research, companies trend to obtain resources from government but not in a directly way, some companies in specific countries may use an unusual method in order to contact with policymaker. Firms can gains more when they try to be partner with government for capture timely newest technological opportunities and sever for their own research and development. From government side, they also are willing to help company to develop in order to get more economic growth and tax revenue. Indeed, the cooperation will benefit both sides of company and government. There is a spillover effect of this cooperation which is maximize the efficiency and allocate the public the research and development cost.

2.2 More investments if work with government
Secondly, associate with government brings more confidence to company to increase more in investment in local economic. There is an example which “Carlyle Group” built a good relationship and collaborating with...

Links: with Universities and Government Labs? Evidence from CIS 2. Managerial & Decision Economics, 24(2/3), 133-145. Retrieved from EBSCOhost.
Rothbard, M. (1995).“Making Economic Sense”. Chapter 51.Government--Business "Partnerships"
Shaver, J. (2007). Collaboration Nation. Fitness Business Pro, 23(4), 36-40. Retrieved from EBSCOhost.
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