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Theodore Levitt's 'the Globalization of Markets': An Evaluation after Two Decades

30 Pages Posted: 26 Feb 2003  

Rawi Abdelal

Harvard University - Business, Government and the International Economy Unit

Richard S. Tedlow

Harvard University - Entrepreneurial Management Unit

Date Written: February 2003

Abstract

Theodore Levitt was one of the first scholars to write a high-impact article on globalization aimed at business managers. Now, two decades later, "The Globalization of Markets" is still widely read. Rather than agreeing with Levitt, however, most observers today believe that his arguments were flawed and his predictions have not been borne out. To be sure, we agree that not all of Levitt's predictions came true. Nevertheless, his article does offer enduring insights; and those are what we want to explore. Understanding Levitt's "globalization" as an analytical lens through which to view the world is highly useful. Indeed, Levitt's central insight - that "preferences are constantly shaped and reshaped" - is crucial for both managers and scholars. What constitutes globalization, in Levitt's (and our) way of thinking, is interaction that changes things, rather than leaving them the same. Successful firms and the managers who run them do not leave the world as they found it. Rather than taking consumer preferences as a given, successful managers have treated them as outcomes. Following Levitt, then, we can see that the global market is not solely what firms find. The market is, to some important extent, what firms make of it.

Keywords: Theodore Levitt, Globalization, Business Managers, Consumers, Consumer Preferences, The Global market

JEL Classification: B20

Suggested Citation

Abdelal, Rawi and Tedlow, Richard S., Theodore Levitt's 'the Globalization of Markets': An Evaluation after Two Decades (February 2003). Harvard NOM Working Paper No. 03-20; Harvard Business School Working Paper No. 03-082. Available at SSRN: https://ssrn.com/abstract=383242 or http://dx.doi.org/10.2139/ssrn.383242

Rawi Abdelal

Harvard University - Business, Government and the International Economy Unit ( email )

Morgan Hall 287
Harvard Business School
Boston, MA 02163
United States

Richard S. Tedlow (Contact Author)

Harvard University - Entrepreneurial Management Unit ( email )

Cambridge, MA 02163
United States
617-495-6688 (Phone)
617-496-4877 (Fax)

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