Chapter 17 – Managing Human Resources in an International Context
Answers to End of Chapter Questions
1. Why is the average age of the population increasing in some nations, particularly the developed
countries? What are some of the implications of this trend, especially for international companies?
The average age of the population is increasing because of better healthcare and higher living standards.
2. Classical economists assumed the labor factor of production to be immobile. Is this assumption
correct in the modern world? Explain.
No. One reason for labor mobility is a shortage of certain categories of workers, frequently in agriculture,
3. What is brain drain, and why does it occur? What actions might countries take in order to reduce
or even reverse brain drain?
Brain drain is the immigration of highly educated people from their home country to a country that offers
them better economic and quality of life opportunities. Losing countries could sponsor their knowledge
4. Why should the international human resource management approaches used by an international
company be closely linked to the competitive strategy the company is using?
Competing forces impact international business. The pressure to achieve global integration and reduction
5. Compare and contrast ethnocentric, polycentric, regiocentric, and geocentric staffing policies.
6. In staffing a multinational organization for service outside the IC home country, what are some
advantages and disadvantages of hiring home-country personnel?
An advantage to hiring home country personnel is that these individuals will know the culture of the
home country as well as the culture of the organization. Also individuals will not have a communication
7. Why has there been an increasing use of third–country nationals in the foreign operations of
ICs?
The use of third country nationals has increased especially in developing countries due to the lack of
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Chapter 17 – Managing Human Resources in an International Context
8. Why are problems involving the trailing spouses of expatriate executives so common? What are
some companies doing to solve those problems?
It is estimated that the majority of expatriate failures is due to family problems. In many cases the family
is ill-prepared to deal with the stress and isolation experienced by expatriate families. An overseas move
9. Why are expatriate employees frequently paid more than their colleagues at equivalent job levels
in the home office?
10. Why are compensation packages for expatriates more complicated than those for domestic
employees?
11. What are some of the quality-of-life issues executives should consider before taking their
families into an expatriate experience?
There are basic quality of life issues: local pollution, water, living standard; and then a whole set of
12. Suppose you are the CEO of an American multinational. On your staff and in the U.S. operating
divisions of your company are several bright, able, dedicated female executives. They are also
ambitious, and in your company, international experience is a must before an executive can hope to
get into top management. An opening comes up for the position of executive vice president in the
company’s Mexican subsidiary. One of the women on your staff applies for the position, and she is
well qualified for the job, better than anyone else in the company. Would you give her the position?
What are the arguments pro and con?
13. Using the company example in question 12, suppose another position becomes available, this one
as treasurer of the Japanese subsidiary. The chief financial officer of the company’s California
division applies for this job. She has performed to everyone’s satisfaction, and she seems thoroughly
qualified to become the treasurer in Japan. In addition, she speaks and writes Japanese. She is the
daughter of a Japanese mother and an American father, and they encouraged her to become fluent
in both English and Japanese. Would you give her the job? Why or why not?
Given the technical skills, language skills would be such a plus for the company in Japan. The perception
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Chapter 17 – Managing Human Resources in an International Context
GlobalEDGE Answers
Exercise One
1. HSBC Expat Zone, which provides insight into expatriate life, publishes an Expat Experience report
every year. Locate and download the most recent report. What does this report focus on? Specifically,
what factors are considered when ranking the countries with the best life experience? Briefly
summarize the key findings of this report and identify the top five countries that offer the best overall
experience to expatriates. Are these findings surprising?
Answer:
http://globaledge.msu.edu
Exercise Two
2. The text discusses the importance of establishing a good compensation plan for foreign employment.
Using the Quarterly Reports for Living Costs Abroad, published by the U.S. Department of State,
provide a report comparing the cities of Rio de Janeiro and Mexico City.
Answer:
http://globaledge.msu.edu
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