Internaltional Business USA & Russia comparative analysis

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representative village of just 100 people. The following sections elaborate some of these characteristics.

Demographics

As you consider which countries to sell products to or do business in, it is important to understand the basic demographic characteristics of each country. Demography is the statistical analvsis of the properties of a particular popula- tion; important aspects include distribution, density, and trends. Although it is possible to focus on a varietv of different demographic characteristics, we will concentrate on population, age distribution, population growth rate, and life expectancy at birth.

From a broader social perspective, the World Bank states that "derrelopment is about people and their vv'ell being-about people developing their capabili- ties to provide for their families, to act as ster,vards of the environment, to form civil societies that are just and orderlv. Human capital development-the result of education and improvements in health and nutrition-is both an ends and a means to achierring social progress." The World Bank goes on to describe a variety of factors that are important for understanding the health and well- being of individuals, such as access to health care, percentage of females enrolled in primar5r education, and literacy levels. These broader issues are crucial if countries are to develop strategies for promoting development, espe- cially in improving the education and lvell-being of their population as pro- ducers and consumers of products.

Population Population helps define a companv's market potential. This does not mean that smali countries cannot be good markets for products. Still, Iarger countries tend to provide greater opportunities for derreloping strong markets and for finding emplovees for the production process.

Tables 4.4 and 4.5 heip illustrate the difference betrveen population and income potential. Table 4.4 identifies the top 10 countries in the lvorld in terms of population, and also shows the per capita income in each of those countries.

Top 10 Countries by Population (1999)

Country

1. China 2. India 3. United States 4. Indonesia 5. Brazil 6. Russian Federation 7. Pakistan 8. Bangtadesh 9. Japan

10. Nigeria

Poputation in Thousands

't,249,671

997,515 272,878 207,A22 168,066 746,572 734,790 1,27,669

126,570 723,897

Per Capita Income in U.S. Dol[ars

780

450

30,600 580

4,420 2,270

470

374 32,230

310

Top 10 Countries by Per Capita Income (1999)

Country

1. Luxembourg 2. Switzertand 3. Bermuda 4. Norway 5. Japan 6. Denmark 7. United States 8. Singapore 9. Iceland

10. Austria

Per Capita Income in U.S. Doltars

44,640 38,350 35,590 32,880 3?,230 32,030 30,600 29,670 29,284 25,970

Population in Thousands

432

7,1?0 64

4,454 726,570

5,377 272,878

3,223 277

8,086

It is interesting to note that the tu.o largest countries, China and India, have relativeh, lor,v per capita incomes relative to their population size. Table 4.5 reverses the columns by ranking the top 10 countries in the r,vorld in terms of per capita income, then providing the population in the second column. It is interesting here to note that the countries lvith the largest per capita income are not the countries lvith the largest populations.

Age Distribution Another \r,a1, to examine the popuiation of a countrv is through its age distri- bution. This can indicate, for example, the potential market for vouth-oriented \/ersus elderh' oriented products. It also indicates hou'many people may be available in the nrorkforce. Figure 4.3 prorrides some useful information about Germanv: The male-female distribution, life expectanc-v of males and females, and the percentage of the population, both male and female, in each age group. Germanv represents a typical high-income industrial country in lt hich there is a relativeh, ]611r percentage of the under-2O population. The age distribution starts off relativell, 1s11, in the uncler-20 age group; expands out a bit until about age 50; then contracts again, This is ver\i common in other high-income coun- tries. In Figure 4.4, r,ou can see the age distribution of Mexico, u,hich has a total population similar to Germanr,'s but a \rerlr different age distribution. (In 1999, Mexico had the u'orld's 11th largest population, and Germany the r,r'orld's 1Zth largest.) Mexico's age distribution is a pvramid structure, rvith a larger percentage of the population in the belort'-20 age group, then graduallv tapering off to the upper age groups. It is also interesting to note that lvlexico, r.t hich is considered a cleveloping courltrv, has a life expectancy a little differ- ent from that of Germanr,. Horer,er. this is not true of other developing coun- tries, especialll, the ver]' lon-income countries.

Population Growth Rate The rapidlv aging populations of the high-income countries is ftirther illustrateci in population grou,th statistics. Population gronth is defined as a percent per vear