Big business includes large-scale multi-national business or financial activities conducted in a global context. As such a term, it refers to activities that conduct in various countries at the same time and involve different companies and individuals. This can be in the form of multinational banking and financial activities, such as central banks of various countries, central banks of certain regions, multinational financial corporations, multinational trading corporations etc. However, the common element that binds all the entities under this label is their ability to grow large and earn profits.
In order to achieve large business and economic growth, managers and leaders need to use tools such as break-even analysis and financing. Break-even analysis is a study on the viability of a company based on its capitalization, assets, liabilities, revenues, and expenses. For example, a big business may have huge financial obligations (liabilities) and relatively fewer assets. With this information, a manager can determine if the business is indeed viable as a long-term investment.
The analysis also determines if the business is growing fast enough to support its current and future expenses and revenues. The size of the businesses needs to be determined because they play a major role in the economic power of nations. In developing nations, infrastructure development and other economic activities demand a lot of capital, which local businesses are unable to obtain due to lack of available resources. A key driver in determining the size of businesses is the availability of people and adequate resources, which in turn is influenced by the level of competitiveness of these nations.
Another vital aspect of the analysis is the rate of labor productivity. This refers to how many jobs are created with every dollar spent in the economy. Fast growing, technologically advanced countries tend to have much lower labor productivity than developed countries, which depend largely on industrial capacity and heavy investment in labor. On the other hand, mature economies with plenty of internal competition have much higher rates of economic growth because they have access to skilled labor and the proper technology to make products.
The analysis also compares the employment and cost of Big Business in the United States and China and in Europe, two of the most important global competitors. The study concludes that the productivity gap between the United States and European Union is narrowing, but the gap between the United States and China is still large. In addition, the high level of wages paid to employees in the United States and in Europe contribute to strong national income and labor relations.
The study then goes on to describe how the United States has been able to manage the economic expansion required during the Great Depression by encouraging domestic production. It also examines the Great Compression and its effect on the formation of the middle class in the United States. Finally, the book describes the twentieth century’s economic policies and outlines the types of big businesses that emerged during that period. The book concludes by briefly looking at two big business ideas that grew during the twentieth century: automation and intellectual property. The author makes a case for why a basic model of capitalism should prevail over market socialism. All in all, this book provides an interesting historical look at the role of big businesses in our nation’s economic development.
