Investigate the Future of International Trading Companies Facing Protectionism: Modelling and Analysis Based on a Unavoidable Reverse Globalization World

Abstract

This thesis focuses on the trend of reverse globalization. With the recent changes upon the political platform, the never doubting trend of globalization is on the line. Drawing ideas from business analytical articles, as well as the disruptive events happening all over the world, this thesis has established the inevitable trend of reverse globalization. Reverse globalization is on the rise as the interests of researching the impact that reverse globalization may have upon international trading companies. Due to the lack of previous research, this thesis looked into studies about globalization, then predict inherent characteristics of reverse globalization based on the traits of globalization. This thesis then set up a mathematical model trying to predict as well as serve as an indicator for international trading companies. In this model, this thesis attempted to use “transportation cost” as an abstractive indicator for all measures that may have a negative impact on international trading. The model has indicated the overall performance of the international trading companies largely depend on the level of transportation cost. Within a reasonable range of transportation cost, the international trading companies will keep on trading internationally. However, when the transportation cost rises, the level of goods crossing borders decreased drastically. The model shows transportation cost increase could lead to many other problems, such as decreasing the consumer surplus in the market, less choice of products in the market, stimulate the possibility for monopoly.